Greeks agree coalition government without Papandreou

 
George Papandreou at emergency cabinet meeting, 6 November 2011 George Papandreou had already made clear his willingness to step aside

Greek leaders at crisis talks in Athens have agreed to form a new national unity government, the president's office says.

Beleaguered Prime Minister George Papandreou has agreed to stand down and his successor will be chosen during talks on Monday, a statement said.

The coalition is to lead the country until elections, which could be held on 19 February, the finance ministry said.

The announcement followed a week of turmoil over Greece's debt crisis.

Once the new leader is named, Mr Papoulias will invite parties to join the new government, according to the statement from the president's office.

The plan envisages elections once the government approves an EU bailout package.

Talks between Mr Papandreou and main opposition leader Antonis Samaras were hosted by President Karolos Papoulias on Sunday evening.

Mr Papandreou had been trying to build a national unity government to replace his Pasok party administration, but Mr Samaras, of the New Democracy party, had been refusing to negotiate unless his rival resigned first.

Analysis

This was the final act in a week of political turmoil. The prime minister and the leader of the opposition were brought together by Greece's president to decide on a new national unity government.

Nobody was certain an agreement would be reached. Both sides have played a high-stakes game of political brinkmanship in the last few days.

But both knew patience was waning and this could be the last chance to find consensus.

As the talks continued, Greeks watched and waited. This country has been in the grip of uncertainty for days, political wrangling adding to its financial woes.

In the bars and cafes of Athens, ordinary people are craving stability and a leader who can steer Greece towards calmer waters.

The two men also disagreed sharply on the timing of new elections, with Mr Papandreou seeking a delay of several months while Mr Samaras wanted them immediately.

There has been speculation that the new coalition could be led by current Finance Minister Evangelos Venizelos or by Lukas Papademos, a former deputy president of the European Central Bank.

A Greek government spokesman a new administration would be sworn in and a confidence vote held within a week if all went well.

"Today was a historic day for Greece," Ilias Mossialos said.

A spokesman for the New Democracy party said it was "absolutely satisfied" with the outcome of the talks.

"Our two targets, for Mr Papandreou to resign and for elections to be held, have been met," the New Democracy spokesman told AP news agency, speaking on condition of anonymity.

At a late-night meeting on Sunday, Mr Venizelos met opposition members and agreed that 19 February would be the most suitable date for elections, according to a finance ministry statements.

However few other details have emerged, such as how quickly the bailout deal might be approved.

Referendum plan

Mr Papandreou narrowly won a confidence vote on Friday, but had been under continuing pressure to resign amid chaos over the debt crisis.

Eurozone deal

  • Private banks holding Greek debt accept a 50% loss
  • European Financial Stability Facility (EFSF) to be boosted to 1tn euros ($1.4tn:£880bn)
  • Banks told to recapitalise by 106bn euros

The fresh bailout deal was agreed by the European Union last month, but Mr Papandreou faced the wrath of fellow EU leaders when he announced that he would put the deal to the people of Greece in a referendum.

The idea was dropped days later, but not without sparking a deeper financial crisis and triggering the political crisis which led to the confidence vote.

The EU says no more funds will be released to Greece until the new bailout deal has been approved.

It gives the government 130bn euros (£111bn; $178bn) and imposes a 50% write-off on private holders of Greek debts, in return for deeply unpopular austerity measures.

The country has come under huge international pressure to resolve its political crisis, in order to calm the markets.

The possibility of Greece leaving the euro has also been raised by EU leaders, if it fails to resolve its political and financial problems.

A meeting of EU finance ministers is taking place on Monday, which added to the pressure on Greece to find an early solution to the political deadlock.

News of the crisis talks involving President Papoulias emerged after an emergency cabinet meeting led by Mr Papandreou.

Both Mr Papandreou and Mr Samaras had held separate talks with the president earlier in the weekend.

 

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  • rate this
    +3

    Comment number 105.

    Let me get this correct...

    Mr Papandreou had a vote of and from the Greeks for a confidence vote.
    He won that vote, albeit by a narrow majority.

    Now there is a diplomatic shuffle and he is being "nudged aside" ??

    I would have understood it more if the leaders had requested him to alight the political bus, but where is the democracy in this ideology?

    Is EU Batman and Robin: Merkel and Sarkozy ?

  • rate this
    -6

    Comment number 104.

    @93.K_in_Melbourne

    I know the Greeks are a proud and some would say arrogant nation but to insult Germany for offering 50% discount on your countries debts and jobs for qualified people is as low as you can get.

    The Greek people evade paying tax at every opportunity, and the Greek government is unable to pay the debts IT MADE.

    Don't blame others and bite the hand that feeds you now.

  • rate this
    -10

    Comment number 103.

    Spare us tears over the lost referendum cause in Greece. The Eurozone is teetering on the edge of a cliff, multiple defaults and recession are looming, and you want everyone to sit on their hands and wait for a referendum in December… maybe. The urgency is overriding, and survival supersedes the luxury of customary niceties.

  • rate this
    +5

    Comment number 102.

    A crooked political system regenerates itself in favour of its salvation. Those who brought Greece to this situation after decades of money-siphoning come out in new colours to please the EU and trick their voters. While the EU knows that it is them politicians who should be court-marshalled for innumerate scandals related to EU money, it blames the Greek people instead. Goodnight Greece!

  • rate this
    +3

    Comment number 101.

    @Zilakifi In actual fact Merkel and Sarkozy are told what to do by Barrosso and the EU commission, it is just easier for them if everyone believes democratically elected leaders run Europe. Democracy is dying and the only way to stop that is for the EU to be dismantled and replaced with a free trade agreement instead of political and economic union

  • rate this
    -1

    Comment number 100.

    74. prolerat
    19 MINUTES AGO
    "It it is a whole system of capitalism we are in subsiervance to”

    It’s the version of Capitalism we employ to blame. Greeks are largely left wing (2 communist parties and 1 socialist in Parliament) and has been mainly ruled by the Pan-Helenic Socialist Movement. Limited space do not allow me to describe how state Capitalism ruined Greece but you see the outcome.

  • rate this
    +13

    Comment number 99.

    I don't see how changing the government is going to make any difference. To accept the bailout the austerity measures still have to be passed. Why do the people always suffer for the folly of politicians?

  • rate this
    +14

    Comment number 98.

    Have they asked Sarkozy's permission yet?

  • rate this
    +6

    Comment number 97.

    89.Zikalify
    problem is they think they already do!, just see how the Greek PM was 'summoned' to the headmaster / misteresses office this last week because he was 'a very naughty boy!'..., referendum and democracy? purhh!, what was he thinking? the EU don't do that trash!

  • rate this
    +2

    Comment number 96.

    The Americans could easily pay a trillion Euros to wipe out the Greek crisis. After all, Uncle Sam, the Yew Ess Gummint, is already 14 trillion dollars in debt, so another trillion on the side would hardly be noticed.

  • rate this
    0

    Comment number 95.

    77. Rosalind Mercer .
    You are totally right.The EU epitomises corruption and legalised theft, unlike the Commonwealth, where countries such as Nigeria, Zimbabwe, Vanuatu, Pakistan, India and Papua New Guinea have no corruption at all and the politician wouldn't dream of stealing citizens' money or misusing the aid they don't receive from Britain because it gives it all away to the EU.

  • rate this
    +8

    Comment number 94.

    Oh gosh, what a mess.....but perhaps a necessary mess (for us all). Greed is not a stable foundation on which to build anything. The pain of loss will hopefully bring us back to the basics of what is important in life - love for eachother. My blessings to the good Greek people

  • rate this
    +3

    Comment number 93.

    The arrogant punitive and disciplinarian remarks by many EU "partners"about Greece are amazing.

    Fuchtel from the German government (BBC news) praised Greek talent at tourism (=you are good at waitressing) whilst offering jobs in Germany to Greek engineers and doctors. How benevolent!

    We Greeks, Herr Fuchtel, Sir, your loyal subjects (shortly to become) send our ever lasting humble thanks...

  • rate this
    +1

    Comment number 92.

    So the road to the 17-state eurozone caucus begins. Greece, Italy etc will be welded in, the smaller outfits like Benelux, Austria, Finland etc will be given their orders. This will form a bloc which will bulldoze through what it wants, to the detriment of the UK & other non-Euro members. At that point it will be time for the UK to get out.

  • rate this
    +3

    Comment number 91.

    Does it matter whos steering a sinking boat?
    Reform the tax collection system, pension system and try to balance your books without a budget defecit.
    The damage is done, no easy way out now whatever is decided. Although I feel the populous should have been consulted via democracy!

  • rate this
    +7

    Comment number 90.

    It is hard to believe that George Papandreou and Antonis Samaras studied together in the States. Maybe their classes in statesmanship clashed with those in opportunistic self interest as they seem to have learned very different ideas about how to behave in politics.

  • rate this
    +8

    Comment number 89.

    Does anyone else feel like merkel and sarkozy run europe?

  • rate this
    +3

    Comment number 88.

    This is the fate not only for Greece but for other countries too. When you have financial crisis you have no democracy.
    The Greeks cannot express their opinion.

  • rate this
    +1

    Comment number 87.

    I thing all government pollitical parties in Europe not only in Greece has one view how to protect the bankers and how to make poor people pay more so wake up, all europe countries today is greece tommorow itally who knows is the next.Is there anyboby like merkel and sarkozi position ?who cares about people who is starving in Europe they all care only how to make their profits more and more

  • rate this
    0

    Comment number 86.

    HONESTLY......

    It may not be democracy.....

    but it really is:

    ALL Greek to me !!!?????

 

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