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Greece's Syriza party splits

The new anti-bailout Popular Unity party is expected to steal some voters away from Tsipras.

FILE: The new anti-bailout Popular Unity party is expected to steal some voters away from Tsipras.

ATHENS - Rebels angered by Greece's international bailout walked out of the leftist Syriza party on Friday, formalising a widely-expected split after leader Alexis Tsipras resigned as prime minister to pave the way for early elections.

The new anti-bailout Popular Unity party set up by the far leftists is expected to steal some anti-euro voters away from Tsipras. But it allows Syriza to move closer to the political centre and clears the way for Tsipras to more decisively implement the bailout programme if he is re-elected.

The split, which cost Tsipras 25 lawmakers or a sixth of Syriza's parliamentary group, came a day after he abruptly resigned to force early elections in a bid to cement his grip on power and deal with the growing rebellion in the party's ranks.

Greece's president gave the conservative opposition a chance to form a new government, but the effort is almost certain to prove unsuccessful and Greeks are expected to return to the polls for the second time this year on 20 September.

The vote opens a new chapter of political and economic uncertainty for Greece just a day after money began flowing from Greece's third bailout programme, prompting calls from the euro zone that Athens must stick to commitments given under the rescue deal.

The election could hamper or delay a review planned for October of Greece's progress under its new bailout programme and rekindle concerns about Athens' ability to honour its pledges, Fitch ratings agency warned.

Many Greeks weary after months of turmoil that included a three-week shutdown of banks and the imposition of capital controls responded with wariness and anxiety.

"It is, of course, wrong. And we citizens will suffer the consequences, because we will go through a period of insecurity," Athens shop owner Konstantinos Poulopoulos told Reuters Television.

Former Energy Minister Panagiotis Lafazanis, a former close adviser to Tsipras who was fired last month for refusing to back the government, said his new leftist party would give Greeks who oppose the $97 billion bailout package from euro zone and International Monetary Fund lenders a voice.

"The country cannot take more bailouts," Lafazanis told a news conference. "We will either finish off the bailouts, or the bailouts will finish off Greece and the Greek people."

He and other far-left members of Syriza have been defying Tsipras in parliament ever since he performed a U-turn and accepted the bailout package and its austerity measures in order to save the financial system and Greece's future in the euro.

With 25 lawmakers, the new leftist party will be the third largest bloc in Greece's 300-seat parliament. That allows it to have a go at forming a government if the conservative opposition fails to cobble together a coalition.

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