Pro-bailout conservative party wins Greek election

Yannis Behrakis / REUTERS

A Greek orthodox priest holds his ballot paper as he exits a voting booth at an Athens primary school used as a polling station on Sunday.

By NBC News, msnbc.com staff and news services

Updated at 3:57 p.m. ET: ATHENS -??The pro-bailout New Democracy party came in first Sunday in Greece's national election, and its leader has proposed forming a pro-euro coalition government.

"The Greek people voted today to stay on the European course and remain in the euro zone... there will be no more adventures, Greece's place in Europe will not be put in doubt," New Democracy leader Antonis Samaras said.

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He said voters chose "policies that will bring jobs, growth, justice and security."

His party beat the anti-bailout Syriza party, which wanted to cancel Greece's international bailouts.

Syriza chief Alexis Tsipras conceded the election but vowed to continue its fight against the punishing terms of an EU/IMF bailout saving the country from bankruptcy.

"From Monday, we will continue the fight," Tsipras told supporters. "A new day for Greece has already dawned.

An official projection released by the interior ministry showed conservative New Democracy taking 29.5 percent, with the radical leftist Syriza bloc just behind at 27.1 percent. The PASOK Socialists were set to take 12.3 percent.

Because of a 50-seat bonus given to the party which comes first, that result would give New Democracy and PASOK 161 seats in the 300-seat parliament, in an alliance committed to a 130 billion euro ($164 billion) EU/IMF bailout keeping the country from bankruptcy.

Sunday's vote was seen as crucial for Europe and the world, since it could determine whether Greece was forced to leave the joint euro currency, a move that could have potentially catastrophic consequences for other ailing European nations and the global economy. As central banks stood ready to intervene in case of financial turmoil, Greece held its second national election in six weeks after an inconclusive ballot on May 6.

Greece has been dependent on rescue loans since May 2010, after sky-high borrowing rates left it locked out of the international markets following years of profligate spending and falsifying financial data. The spending cuts made in return have left the country mired in a fifth year of recession, with unemployment spiraling to above 22 percent and tens of thousands of businesses shutting down.

Europe may be able to muddle through but the risk is rising. "There could be a Lehman's moment if things are not properly handled," Robert Zoellick, the outgoing head of the World Bank, told Britain's Observer newspaper.

The bankruptcy of U.S. bank Lehman Brothers in September 2008 triggered a global financial slump that indebted western nations are still struggling to recover from.?

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"Things are getting worse and worse in Greece. There is no future for the next few years there," says Christos Christoglou, a Greek inspection engineer, who moved to Germany to find work.

'Most important election in history'
The ongoing uncertainty was a prime concern for Greek psychologist Sofia Arvanici, who spoke to NBC News at a polling station in a northern suburb of Athens.?

"This is Greece's most important election in history," the 36-year-old said. "We don't know whether we will have a government tomorrow, but we can't have more instability."

The European Union and International Monetary Fund have insisted that the conditions of the 130 billion euro bailout accord agreed in March must be accepted fully by a new government or funds will be cut off, driving Greece into bankruptcy.

Opinion polls show Greeks, weary after five years of deep recession, overwhelmingly favor remaining in the euro. But there is bitter anger over the repeated rounds of tax hikes, slashed spending and sharp cuts in wages.

"I voted with a heavy heart for a pro-bailout party because I want the country to stay in the euro, with the help of our European partners. I don't think the failed recipes of the left would get us out of this mess," Stratos Economou, 49, who runs a bakery shop in Athens, told Reuters.?

Germans on edge as key Greek vote nears

Zoellick and other policy makers insist that the austerity Greece is living with is preferable to the alternative.?

The Observer said the Zoellick would tell?a G-20 summit that the euro crisis could hit developing nations?hard, although clearly the effects would be felt further afield. ?

"Uncertainty in markets is now starting to increase costs for developing countries," he told the newspaper. "The ripple effects are making everybody's life harder."?

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The?G-20, which brings together finance ministers and central bank governors?from 19 major economies and the European Union, will start a meeting in Mexico on Monday. ?The gathering?in the Pacific resort of Los Cabos promised to be overshadowed by the elections in Greece and mounting worries about Spain and Italy.

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During Sunday's election, voters will choose a new prime minister, but the election is also considered a proxy for a much bigger question: will Greece still use the Euro or not? CNBC's Michelle Caruso-Cabrera reports.

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Bartering takes hold in austerity-wracked Greece

The fate of the euro as well as the European Union itself was top of mind for finance director?Kostas Theoharis, 40, as he cast his vote near Athens.?

"The main scenario is whether the euro will exist. This is the question that needs?answered rather than whether Greece will be part of the euro,"?he told NBC News at an Athens polling station with his son Alex, 6. ?"I fail to see how Greece could leave the euro without breaking up Europe. I understand that this is a financial problem but it needs a political solution."?

NBC News' Yuka Tachibana, msnbc.com's F. Brinley Bruton and Reuters contributed to this report.?

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