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Tested by dissent, Greece to vote on more bailout conditions

By DEREK GATOPOULOS
Associated Press

ATHENS, Greece (AP) - Barely a week after their last crunch vote, Greek lawmakers are set to vote later Wednesday on further economic reforms demanded by international creditors in return for a new financial bailout.

Failure to pass the measures overwhelmingly could undermine the coalition government of Prime Minister Alexis Tsipras and trigger fresh fears over the country's future in the euro.

The vote on changes to Greece's judicial and banking sectors is one of the requirements that Greece's European creditors insisted upon in order for negotiations on a third bailout worth around 85 billion euros ($93 billion) to begin.

After losing the support of a large chunk of his own party's lawmakers during a vote last week on a creditor-demanded austerity measures, Tsipras has to rely on support from pro-European opposition parties to gain parliamentary approval.

The measures demanded by creditors for a bailout have caused much consternation within Tsipras' radical left Syriza party.

Many, including former finance minister Yanis Varoufakis, voted against last week's austerity measures, which included big increases to sales taxes that came into effect at the start of this week. If more than a handful more dissent later, then Tsipras' government could be in trouble.

Negotiations with creditors are expected to start soon after the vote later, provided there is no ensuing domestic political uncertainty.

The Greek government hopes that the discussions can conclude before Aug. 20, when Greece must repay a debt worth more than 3 billion euros ($3.3 billion) to the European Central Bank.

The party's traditional base within the trade union movement is angry at what it sees as Tsipras' betrayal of his electoral mandate. A union representing civil servants is planning an anti-government protest outside parliament before the vote that is expected around midnight (2100GMT).

Tsipras has accused party critics of acting irresponsibly.

"I've seen a lot of reactions and heroic statements, but so far I haven't heard any alternative proposal," Tsipras told party lawmakers on Tuesday, according to a senior government official. The official asked not to be named, citing the sensitivity of the parliamentary vote.

Tsipras also said those supporting the country's exit from the euro or handing so-called IOUs to pensioners "should come out and say it, instead of hiding behind the safety of my signature."

The reforms being considered Wednesday are aimed at reducing the country's court backlog and speeding up revenue-related cases. Lawmakers have also been called to approve reforms related to banking union mechanisms, aimed at reducing the risk for European governments from bank crises.

Finance Minister Euclid Tsakalotos said planned pension spending cuts required "further study" before being submitted to parliament.

In Brussels, Pierre Moscovici, the European Union's top economy official, said he's hoping the bailout deal can be signed by mid-August, while accepting that Greece has to meet a "punishing" schedule.

Moscovici said he welcomed the vote later even though it did not include all details hoped for on early retirement and farmers' taxation.

Greece has relied on bailout loans totaling 240 billion euros since 2010 after it was locked out of international money markets. In return for the cash, successive governments have had to enact harsh austerity measures to try to get public finances into shape. Though the annual deficit has been reduced dramatically, the country's debt burden has risen as the Greek economy has shrunk by around a quarter.

Figures from the European Union's statistics agency Wednesday showed that the country was making some progress on the debt front at the start of the year, progress that's going to have been badly impacted by recent events.

Following repayments to European creditors and the International Monetary Fund, Eurostat said Greece's debt fell to 301 billion euros at the end of the first quarter from 317 billion at the end of 2014. That took the country's debt burden down to 168.8 percent from 177.1 percent. Though lower, Greece's debt remains the highest in the 19-country eurozone by a wide margin.

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Raf Casert in Brussels contributed to this report.

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