Thursday, November 3, 2011

Breaking news: Greek crisis calls for Papandreou to resign

George Papandreou
Greek PM George Papandreou is facing calls from senior members of his own party to resign, amid uncertainty about a eurozone bailout deal.

Four ministers, including influential Finance Minister Evangelos Venizelos, said they opposed Mr Papandreou’s plan to hold a referendum on the EU deal.

Earlier the BBC reported that the prime minister was preparing to offer his resignation.
But state TV later reported that he had ruled this out during the meeting.

The opposition New Democracy party has said it would accept taking part in a coalition government if Mr Papandreou agreed to stand down.

The BBC’s Mark Lowen, in Athens, says that whatever the outcome, Greece has been thrown into a period of intense political instability.

The EU bailout, agreed last month, would give the heavily indebted Greek government 130bn euros (£111bn; $178bn) and a 50% write-off of its debts, in return for deeply unpopular austerity measures.
‘Ready to talk’

New Democracy leader Antonis Samaras called for a caretaker government to safeguard the EU deal.
“I ask for the formation of a temporary transition government with the exclusive responsibility to immediately hold elections, and ratify the loan deal under the present parliament,” he said, quoted by AFP news agency.
A government spokesman said it was ready to talk to the opposition about the issue.

“We welcome New Democracy’s decision to support the 26 October deal,” said spokesman Ilias Mossialos, referring to the EU bailout deal.

“As far as the other proposals are concerned, we are ready to seriously discuss them, in the interest of the country.”

Mr Papandreou had called a vote of confidence for Friday. His Pasok party holds a slim majority, 152 out of 300 seats.

Greek parliament graphic
However, he was faced with a parliamentary revolt after several of his MPs withheld their backing. Some called for early elections or a government of national unity instead.
Shadow over G20

One Pasok rebel MP, Eva Kaili, told the BBC: ”I think now the only solution is to have a new government of national rescue and co-operation led by a person that is recognised by the majority [as] prime minister and tries to uphold the agreement [on the EU bailout] of 26 October.”

The row threatens to overshadow a meeting of the G20 in Cannes, where leading industrialised nations are to discuss the eurozone debt crisis.

Mr Papandreou told reporters in Cannes his referendum would in effect be a vote on whether Greece should remain in the euro.

“The treaty doesn’t foresee an exit from the eurozone without exiting the EU,” spokeswoman Karolina Kottova told a briefing in Brussels.

Earlier, the chairman of the group of eurozone countries, Jean-Claude Juncker of Luxembourg, said plans were in place for a Greek exit from the euro.

“We are absolutely prepared for the situation that I have described and do not want to see come about,” Mr Juncker told German ZDF television.

Mr Venizelos launched the parliamentary revolt in the early hours of Thursday with a statement saying Greece’s membership of the euro could not be put in doubt.

“If we want to protect the country we must, under conditions of national unity and political seriousness and consensus, implement without any delay the decision of 26 October. Now, as soon as possible,” Mr Venizelos said.

Mr Venizelos is a former challenger for the Pasok leadership. In 2004, he was defeated by Mr Papandreou by 56% to 38% in a party vote.

Greece was due to receive the next tranche of funds from its first bailout later this month. However, the EU has said it will not transfer the 8bn euros until after the referendum.

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