Greek socialists win snap general election

The centre-right New Democracy of Prime Minister Costas Karamanlis, which had called a snap election only two years after his 2007 election win, had hoped to give a boost to his faltering government with its one-seat majority.

His gamble did not pay off, however, with his conservatives gaining the support of just 34 percent of voters, translating into 94 seats.

"We stand here united before the great responsibility which we undertake," Mr Papandreou told thousands of his supporters at a rally in Athens after the results became clear.

"I know very well the great potential of this country. Potential that is being drowned by corruption, favouritism, lawlessness and waste. Potential that we will set free," he said.

Mr Karamanlis' party had been hit by a series of corruption scandals, the economic crisis and was widely viewed as having badly handled a series of natural disasters.

Moreover, the election offered a clear choice between Pasok and New Democracy.

The former promised a €3 billion stimulus package that would include above-inflation wage and pension increases, higher taxes for the wealthy and a review of the privatisation of flag carrier Olympic Airlines and the sale of the government's stake in OTE, the telecoms firm.

Meanwhile New Democracy campaigned on promises of wage and pension freezes for government employees and further austerity and cutting of social programmes in order to tackle the country's deficit, already twice the European Union's allowed maximum of three percent of GDP.

Mr Papandreou, whose father and grandfather had both been prime minister, was born in the United States while the country was under military rule, and has been mocked for the errors in his spoken Greek.

Despite the convincing victory, recent polls have shown that as many as nine out of 10 Greeks do not trust either party, and abstentions were also high amongst the young, who analysts worry are turning their back on parliamentary politics.

Last December, the country was rocked by violent youth riots that lasted three weeks in what was described at the time as the worst unrest to hit Greece since the restoration of democracy in 1974.

The far-left Syriza coalition saw a decline in its support from five percent in 2007, giving it 14 seats, to 4.4 percent and 12 seats on Sunday.

The Communists remain the third largest party in the assembly, but they too saw a drop since the last election, clocking in at 7.3 percent and 20 seats, down from 8.2 percent and 22 seats.

The far-right however sharply increased their support, with the Popular Orthodox Rally (Laos) climbing from 3.8 percent and ten seats 5.5 percent and 15 members in the house.

The Ecological Greens, who had said ahead of the election that they were willing to work with either the socialists or the conservatives did not manage to achieve the surge in backing they had been hoping for and failed to make it into the parliament, winning 2.4 percent, just shy of Greek democracy's three-percent threshold.