Forest fires seen crucial as Greeks vote

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ATHENS (Reuters) - Greeks cast ballots on Sunday in an election expected to determine the fate of key economic reforms and turn fringe politicians into powerbrokers as voters angry with this summer's forest fires punish big parties. The election pits conservative Prime Minister Costas Karamanlis against socialist leader George Papandreou, both heirs to prominent political dynasties, but opinion polls showed neither easily winning a majority in parliament. Karamanlis called the early vote confident he could secure an easy victory, but criticism of the government's response to the forest fires which killed 65 people in August and a series of scandals may have harmed his chances.

ATHENS (Reuters) - Greeks cast ballots on Sunday in an election expected to determine the fate of key economic reforms and turn fringe politicians into powerbrokers as voters angry with this summer's forest fires punish big parties.



The election pits conservative Prime Minister Costas Karamanlis against socialist leader George Papandreou, both heirs to prominent political dynasties, but opinion polls showed neither easily winning a majority in parliament.



Karamanlis called the early vote confident he could secure an easy victory, but criticism of the government's response to the forest fires which killed 65 people in August and a series of scandals may have harmed his chances.


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Opinion polls suggest voters defecting to smaller parties, such as the far-right LA.O.S., which is expected to win seats in parliament for the first time.



Polls opened nationwide at 7 a.m. (midnight EDT) with more than 9.8 million registered voters. Exit polls are expected immediately after voting ends at 7 p.m.



"The voting process is running smoothly," said acting Interior Minister Spyros Flogaitis.



Surveys published before a September 1 opinion poll blackout showed the conservative New Democracy party leading the socialist PASOK by one to two percentage points, a far cry from its 2004 landslide election victory. More than 10 percent of voters were undecided.



"We respect and trust citizens and take part in this democratic procedure with a smile and confidence," Karamanlis told reporters after voting.



Political analysts said PASOK appeared unable to capitalize on the government's woes, with many voters not ready to forgive the socialists for their own scandals while in power.



"I will give the government one more chance," said Evangelia Katsantonaki, 36, a farmer in the central Greek town of Larissa. "The socialists had 20 years to improve conditions.



REFORMS AT STAKE



If the vote is inconclusive and attempts to form a coalition fail, Greece faces new elections. That could delay reforms, including shoring up an ailing pensions system which could go bust in 15 years.



Karamanlis, nephew of the late statesman Constantine Karamanlis, has cut deficits and created 200,000 jobs but unemployment is still above the EU average despite a healthy 4.4 percent GDP growth rate this year.



But Brussels has said more reforms are needed. About 20 percent of Greeks live below the poverty line and per capita GDP is the lowest next to Portugal's in the euro zone.



"I voted for PASOK because I believe in them. In the last 3 years, nothing right was done about the economy or pensions," said school teacher Despina Vassilantonaki in Athens.



PASOK favors pro-market policies with strong social protection, promising tax breaks and better pensions.



"A new day is dawning for Greece, a day of optimism," Papandreou said after voting.



The son of the late Prime Minister Andreas Papandreou, he has not ruled out cooperating with other parties. Karamanlis has said he would rather call a new election than form an uneasy coalition.



(Additional reporting by Renee Maltezou)



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