Starting from 1974, with the end of the military regime and the restoration of fundamental democratic institutions, a new political phase began for Greece, proclaimed a republic the previous year, characterized by the alternation of governments expressing two main and opposing parties, the conservative New Democracy (ND) and the Panhellenic Socialist Movement (PASOK).
In any case, at the beginning of the 1990s the country remained in a situation of persistent economic crisis and serious disruption of public finances: a situation destined to have repercussions both on the social level (with widespread popular discontent for the austerity measures which essentially united the various governments in office), and on the completion of the integration process into the European economic system (G. had joined the EEC in 1981, and in February 1992 was among the signatories of the Maastricht Treaty).
The center-right government chaired by K. Mitsotákis included among its first initiatives, in July 1990, the signing of an eight-year military cooperation agreement with the United States, which reaffirmed the close relationship between the two countries and kept operating two of the four US military bases existing on Greek territory. This agreement was criticized by the left forces, who opposed even more clearly the restrictive economic policy desired by Mitsotákis and above all, in December, the government’s plans to limit the right to strike (in the previous months the unions had called a series of general strikes, of 24 and 48 hours, with great participation of industrial workers and public employees).
Protests and strikes became very intense between 1992 and 1993, when the government initiated the privatization of various public companies of national interest, particularly in the transport sector. The widespread popular discontent was so behind the electoral defeat of ND, which in early parliamentary consultations in October 1993 was awarded the 39, 3 % of the vote and 111 seats. The majority went to PASOK, which reached 46, 9 % of the vote and 170 seats, while the Communist Party of Greece (KKE), appearing independently, gained 4, 5% of votes and 9 seats; the leftist coalition, an alliance of nine smaller parties, had only 2, 9 % of the vote, and according to the electoral law of November 1990, which had established a minimum threshold of 3 % to enter parliament, did not obtain any deputy. A new government was then formed led by A. Papandréu, who put a stop to the privatization program initiated by his predecessor and sharply mitigated the perplexities that he and his party had expressed in previous years about Greece’s participation in the process. of European integration.
In March 1995 Papandréu favored the election to the presidency of the Republic of K. Stefanópulos, formerly a minister of ND and now supported by the socialists (in the third ballot was voted by 181 deputies out of 300). In terms of foreign policy, the government committed itself, with positive results, to the resumption of diplomatic relations (October 1995) with the former Yugoslav Republic of Macedonia, extremely critical since 1991, when Greece had opposed the recognition of the Macedonian state. born following the dissolution of Yugoslavia, out of fear of possible territorial claims against Greek Macedonia. At the end of 1995the executive’s action was affected by the numerous controversies that arose around the role assumed by Papandréu’s young wife, D. Liani, in the main decisions of the elderly leader; he was forced to resign in January 1996 due to the worsening of his health conditions and died the following June. In the meantime, the socialist exponent K. Simítis had been called to replace him in the role of head of the government, who for some months had taken a critical position towards Papandréu, resigning as Minister of Industry and supporting the need for a profound party renewal.
While relations with Turkey were experiencing new moments of tension, due to the continuing dispute over the delimitation of territorial waters in the Aegean Sea and the conflicts between the Greek and Turkish communities in Cyprus (see Cyprus: History, in this Appendix), the executive launched a series of economic reforms deemed necessary for Greece’s entry into the European monetary union (among other things, the privatization of the telecommunications sector was initiated in March 1996). A significant improvement in relations between Greece and Turkey occurred in June 1999, when a calendar of close meetings was set between the representatives of the two countries.
Also in order to contain spending, Simítis strengthened the austerity measures in the economic field, especially after the outcome of the legislative elections of September 1996, which recorded a growth in the consensus of the left opposition, but at the same time confirmed the socialist majority in Parliament: PASOK won the 41, 5 % of the vote and 162 seats (compared to 38, 2 % and 108 seats in NA), while the communists and the left coalition had the respectively 5, 6 % and 5, 1 % of the votes, equal to 11 and 10deputies; the social democratic movement (DIKKI), which arose in December 1995 on the initiative of some members of the internal left of PASOK, also obtained a good success, which reached 4, 4 % of the votes and 9 seats.
The new government chaired by Simítis set as its priority objectives, at the economic and financial level, the containment of inflation and the reduction of the public deficit, in order to respect the convergence criteria that had been established for participation in the Economic Union and monetary. The austerity measures adopted for this purpose, with heavy cuts in social spending, again caused numerous protest strikes at the end of the year and then between 1997 and 1998, affecting both the private and public sectors.
On the occasion of the military intervention of NATO forces in Yugoslavia, which began on March 24, 1999, Greece refused to participate in the air campaign, condemning the bombing.