Socialists' win puts Greece on course for early euro entry

Costas Simitis, the Greek Prime Minister, will speed preparations for entry into the European single currency and press ahead with rapprochement with Turkey after the hair's breadth victory of his ruling Pasok socialist party in Sunday's parliamentary poll.

Last night officials in Athens said Mr Simitis, a technocrat noted for his careful and steady style, was all but certain to retain key members of his team, including George Papandreou, Foreign Minister and prime architect of the thaw in relations with Greece's ancestral rival in the east Mediterranean.

The exceptionally friendly and trusting rapport between Mr Papandreou and his Turkish counterpart, Ismail Cem, has been crucial in transforming relations since their nadir in early 1999, when Greece was shown to have sheltered Abdullah Ocalan, fugitive leader of the Kurdish insurgency in south-eastern Turkey.

Since then, and spurred by outpourings of mutual sympathy for last year's earthquakes in both countries, the countries have edged closer, to the point of Athens lifting in December its veto on eventual Turkish membership of the European Union.

Mr Simitis' triumph came after a thrilling and fluctuating election night, in which the first exit polls predicted a return to power for the opposition New Democracy conservative party for the first time since 1993. But final results gave Pasok 43.7 per cent of the vote, 1 percentage point more than New Democracy. Under Greece's electoral system this is likely to translate into a workable majority, with 158 of the parliament's 300 seats.

Thus it will be Mr Simitis, not the opposition leader, Costas Karamanlis, who represents Greece at the EU summit in two months that is expected to endorse Athens' entry into the single currency - the crowning moment of the Prime Minister's long personal and political mission to anchor Greece in the European mainstream.

The election outcome was being warmly welcomed in other European capitals, which had feared that a victory for Mr Karamanlis would increase tension between Greece and Turkey and therefore between Turkey and the EU.

A bigger threat now lies with Turkey, after the failure of its Prime Minister, Bulent Ecevit, to secure agreement on a further five-year term for President Suleyman Demirel. This raises the possibility that Mr Cem could be elevated to the presidency himself, to be replaced by a more nationalist and right-wing foreign minister less favourably disposed to better ties with Greece.