As the death toll for those caught in southern Greece's devastating forest fires rose to 63, a Greek prosecutor today ordered an investigation into whether this summer’s arson attacks in Greek forests could be considered terrorism.

Dimitris Papangelopoulos, who is responsible for prosecuting terrorism and organised crime, ordered the investigation to determine “whether the crimes of arsonists and of arson attacks on forests carried out in the country during the summer of 2007" could come under Greece’s anti-terrorism law, the Public Order Ministry said in a statement.

Treating arson as a potential act of terrorism would give authorities broader powers of investigation and arrest . Government officials said they suspect at least some of the blazes, which began on Friday, were caused by arson.

“So many fires breaking out simultaneously in so many parts of the country cannot be a coincidence,” Prime Minister Costas Karamanlis, the Greek Prime Minister, who has called early elections for September 16, said in a nationally televised address on Saturday. “The state will do everything it can to find those responsible and punish them.”

The authorities offered a reward of between €100,000 (£68,000) and €1 million for information leading to the capture of anyone involved in starting the fires. Police were examining a mobile phone video showing two men apparently setting fire to pine forests on Mount Hymettos, on the outskirts of Athens, on Saturday. The size of the reward is dependent on the scale of the fire and how many victims it has claimed.

Over the weekend the Prime Minister placed Greece on an emergency footing and declared three days of mourning for the victims, who included two French tourists burnt to death while hiking on Mount Taygetos, above Sparta. Yesterday rescuers near Olympia found the remains of a mother and her four children, whom she was still clutching. The Olympic Star, a seaside hotel at Amarynthos, 70 miles north of Athens, was evacuated. No British tourists or residents have been reported hurt.

Mr Karamanlis pledged immediate aid to olive growers and olive oil producers in the Peloponnese, many of whom now face ruin. The Government also promised urgent help for families who lost their homes.

It was unclear what effect the fires would have on the national elections, scheduled for September 16. Until they broke out, Mr Karamanlis and his conservative New Democracy party were at least two points ahead in the polls. George Papandreou, the opposition Socialist leader, has tried to tap into a wide undercurrent of resentment that the fires were allowed to go unchecked for such a long time.

On the other hand, conservative politicians have not said so, but many are convinced that socialist radicals could have started some of the fires in an attempt to stoke unrest.

Firefighters and volunteers battled yesterday to save the birthplace of the Olympic Games from destruction as they entered the third day of the devastating fires.

Flames lapped at ancient Olympia, threatening the site of the original Games and a world-class museum. The luxury Amalia Hotel was evacuated in the afternoon. One by one, surrounding villages in Ilia province were engulfed by miles-long waves of flame fanned by relentless winds, sending the inhabitants fleeing. Domestic animals and possessions were abandoned to their fate. The death toll is expected to rise as many elderly people refused to be moved.

The rush to defend Olympia – involving six aircraft, two helicopters, 15 fire engines and 45 firemen – triggered complaints by one woman in nearby Nea Phigaleia. In a call to an Athens television station she shouted: “They’re protecting those old stones while leaving us to burn!” Efforts to protect the museum, which houses classical sculptures such as Hermes by Praxiteles and other finds from pagan temples and sports facilities, appeared to have been successful last night.

Greek television stations were inundated by hundreds of desperate calls, some bordering on hysteria, describing walls of flame descending on mountain communities in the Peloponnese with terrifying speed. The three days of conflagrations completely overwhelmed firefighting forces that were concentrating on two main fronts many miles apart.

The second front is in Evia, north of Athens, where fires sent a stinking pall of smoke across the capital in the 38C (100.4F) heat. Airborne firefighting reinforcements from France, Italy, Israel, Slovenia and even as far away as Iceland flew in yesterday morning.

Summer homes near the Lagonissi resort, 30 miles (50km) south of Athens, were gutted by an overnight flash-fire yesterday. Residents reported hearing the explosions of cooking gas canisters in the woods near their homes, followed by the appearance of flames, strongly suggesting arson.

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