The dust settles on Greece, but where does it go from here?

New Democracy must now form a coalition, and the EU has a contradiction to resolve

The New Democracy party has won the Greek legislative elections with 29.7 per cent on the vote, narrowly beating the radical left-wing party SYRIZA, which earned 26.9 per cent, in what is widely seen as a referendum on the Greek people's acceptance of the EU-imposed austerity package.

Under Greek electoral law, ND is awarded an extra 50 parliamentary seats for coming in first place, which means it has 129 seats overall. A viable coalition requires at least 150, however, so it will still have to find a coalition partner. It is most likely to join forces with the centre-left party, PASOK, previously its major opponent in fights for the centre-ground of Greek politics but now an uneasy bedfellow as implementing the European memorandum (which ties the Greek government to large spending cuts) takes priority.

A PASOK-ND coalition would have 162 seats, and appears likely to be topped up with another 17 from the Democratic Left party (DIMAR), formed of ex-PASOK and SYRIZA MPs. There are several hurdles to be overcome before this coalition can be put in place, not least of which is the self-serving nature of PASOK itself.

Reports from Greece indicate that PASOK's leaders are only too aware that being in charge of a second round of crippling spending cuts could destroy their electoral base, particularly when they have such a viable contender for the left's votes in the form of SYRIZA. As a result, senior figures at PASOK are suggesting that they won't join a coalition unless SYRIZA joins as well - something which the radical left is unlikely to countenance.

While it seems likely that PASOK are only making such a demand out of a desire not to seem too eager to run into the arms of their former enemies, it highlights the difficulty this coalition will have in doing anything not related to the near-state of emergency that Greece is currently experiencing. Many of the more pessamistic analysts and commentators are predicting a breakdown in relations before the end of the year, leading to a third set of elections – one which SYRIZA would almost certainly win.

Even if the full ND-PASOK-DIMAR coalition comes about, all Greece has achieved today is a return to the status quo of earlier this year. Greece remains in the euro for the foreseeable future, but the root of its problems with the EU are no closer to being addressed. The austerity which the coalition will impose will keep Germany and the ECB happy, which will keep money flowing into the country for the time being (an undoubtedly good thing, since reports had suggested that Greece was likely to run out of money to pay its public sector around mid-July without more European funds), but eventually that spigot will have to be turned off.

In addition, the bank jog which could see Greece being mechanically ejected from the single currency won't stop just because SYRIZA came in second place. Deposits have been steadily flowing out of Greek banks since 2009, and if too many euro end up in German banks, the Greek banking sector could fail in one go. 

Even the surface level negotiations – the ones which don't solve the underlying contradictions, but merely provide the funding and credibility for Greece to carry on as it has – could go in any number of directions. The troika (the European Central Bank, the European Commission, and the IMF) is likely to head to the country as soon as there is someone to negotiate with, and there have been reports that they are likely to give the Greek people a "reward" for being co-operative. German foreign minister Guido Westerwelle suggested that the coutnry may be given more time to repay its debts, and the Financial Times last week claimed that the EU was preparing to offer Greece discounted loans if New Democracy won the elections.

When the dust settles, the European Union will find that it has to decide whether it heads down the road of ever deeper fiscal integration, turning Greece into 

New Democracy leader Antonis Samaras. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty
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The campaign to keep Britain in Europe must be based on hope, not fear

Together we can show the world a generous, outward-facing Britain we can all be proud of.

Today the Liberal Democrats launched our national campaign to keep Britain in Europe. With the polls showing the outcome of this referendum is on a knife-edge, our party is determined to play a decisive role in this once in a generation fight. This will not be an easy campaign. But it is one we will relish as the UK's most outward-looking and internationalist party. Together in Europe the UK has delivered peace, created the world’s largest free trade area and given the British people the opportunity to live, work and travel freely across the continent. Now is the time to build on these achievements, not throw them all away.

Already we are hearing fear-mongering from both sides in this heated debate. On the one hand, Ukip and the feuding Leave campaigns have shamelessly seized on the events in Cologne at New Year to claim that British women will be at risk if the UK stays in Europe. On the other, David Cameron claims that the refugees he derides as a "bunch of migrants" in Calais will all descend on the other side of the Channel the minute Britain leaves the EU. The British public deserve better than this. Rather than constant mud-slinging and politicising of the world's biggest humanitarian crisis since the Second World War, we need a frank and honest debate about what is really at stake. Most importantly this should be a positive campaign, one that is fought on hope and not on fear. As we have a seen in Scotland, a referendum won through scare tactics alone risks winning the battle but losing the war.

The voice of business and civil society, from scientists and the police to environmental charities, have a crucial role to play in explaining how being in the EU benefits the British economy and enhances people's everyday lives. All those who believe in Britain's EU membership must not be afraid to speak out and make the positive case why being in Europe makes us more prosperous, stable and secure. Because at its heart this debate is not just about facts and figures, it is about what kind of country we want to be.

The Leave campaigns cannot agree what they believe in. Some want the UK to be an offshore, deregulated tax haven, others advocate a protectionist, mean-hearted country that shuts it doors to the world. As with so many populist movements, from Putin to Trump, they are defined not by what they are for but what they are against. Their failure to come up with a credible vision for our country's future is not patriotic, it is irresponsible.

This leaves the field open to put forward a united vision of Britain's place in Europe and the world. Liberal Democrats are clear what we believe in: an open, inclusive and tolerant nation that stands tall in the world and doesn't hide from it. We are not uncritical of the EU's institutions. Indeed as Liberals, we fiercely believe that power must be devolved to the lowest possible level, empowering communities and individuals wherever possible to make decisions for themselves. But we recognise that staying in Europe is the best way to find the solutions to the problems that don't stop at borders, rather than leaving them to our children and grandchildren. We believe Britain must put itself at the heart of our continent's future and shape a more effective and more accountable Europe, focused on responding to major global challenges we face.

Together in Europe we can build a strong and prosperous future, from pioneering research into life-saving new medicines to tackling climate change and fighting international crime. Together we can provide hope for the desperate and spread the peace we now take for granted to the rest of the world. And together we can show the world a generous, outward-facing Britain we can all be proud of. So if you agree then join the Liberal Democrat campaign today, to remain in together, and to stand up for the type of Britain you think we should be.