The move was brokered by President Karolos Papoulias with leader of the main opposition party, Antonis Samaras of the New Democracy party, also present.
Papandreou’s position had been in doubt even after winning a vote of confidence in him at the end of last week and this latest move comes after the the Prime Minister called for a referendum into the latest bailout from the eurozone.
A decision will be made following talks later on Monday morning. Names in the frame for who might lead the new coalition government include current finance minister and deputy prime minister Evangelos Venizelos as well as the former Governor of the Bank of Greece, Lucas Papademos. Others are the diplomat who led Greece’s entry into the European Union, Petros Molyviatis, and former European Commissioner Stavros Dimas.
The first task of the new leader will be to agree this bailout payment worth €130bn so that pensions and other public sector payments can be made. What it does mean is it gives Greece breathing space that is likely to mean it will not default nor leave the euro in the short term.
This news is also likely to appease other European political leaders, particularly German Chancellor Angela Merkel and French Prime Minister Nikolas Sarkosy, who are known to have been dismayed at Papandreou’s call for a referendum.
