Greek snap election will hinge on economy, graft

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Greek voters go to snap polls on Oct 4 to choose between conservative Greek Prime Minister Costas Karamanlis and Socialist contender George Papandreou.

The ruling New Democracy party trails Socialist PASOK by 6 percentage points in opinion polls. These are some of the issues:

ECONOMY

According to opinion polls, the economy tops voter concerns, with about 60 percent of those asked saying it was the country's biggest problem. From steady 4 percent annual growth rates until 2007, the economy now teeters on the edge of recession, the first since 1993, hit hard by the global slowdown. Poor state revenues feed budget deficits and force the government to resort to more borrowing. Greece's debt is seen at 103.4 percent of GDP in 2009, the euro zone's second biggest debt as a percentage of GDP next to Italy's.

Parties need to convince Greeks they have a plan to put the economy back on a solid growth path.

UNEMPLOYMENT

Unemployment rose to 8.5 percent in May, jumping nearly two percentage points year-on-year. Joblessness hits women and young people especially hard. Many struggle to put their children through university only to see them get degrees but live at home with no or just menial jobs. This, along with widespread belief the country lacks meritocracy, fed the December riots that followed a policeman shooting a teenager.

Voters will be looking to parties to provide a plan for creating more job opportunities, especially for the young.

EDUCATION/SOCIAL STATE

Attempts by the conservatives to reform higher education were met with violent street protests while a 2008 overhaul of the social security system, which experts said would collapse in 15 years due to an ageing population, fell short of what was necessary.

With fear rising that pension funds may go bust, parties must issue programmes that balance measures to rescue them with the least curtailing of pensioners' rights. Health and social welfare, both seen by Greeks as weak, are also on voters minds.

TRANSPARENCY

In recent years, Greece has dropped a few notches on the international watchdog Transparency International's corruption index, and continues to be seen as the euro zone's most corrupt state. Voters brought New Democracy to power in 2004, partly to punish the socialists for decades of graft. But the Karamanlis government soon found itself accused of numerous scandals. None of those involved ever got to trial and Karamanlis gave the impression that he either tolerated or was unable to end graft.

Both main parties are seen as largely corrupt and they must struggle to convince voters they intend to clean up house.

SECURITY/IMMIGRATION

After Greece's worst riots in decades in December, violence has simmered with frequent gas canister attacks and some bomb attacks. Leftist and anarchist groups have capitalised on the climate of social unrest to renew attacks on businesses and police, culminating with the killing of a policeman in June.

Ordinary crime has also risen and many Greeks associate this with a growing wave of illegal immigrants pouring into the country from Asia and Africa, turning some parts of the capital to crime-ridden ghettos. Voter discontent has boosted the ratings of the far-right LAOS party.