Greek premier launches efforts to form coalition

By Derek Gatopoulos

Associated Press

Published: Saturday, Nov. 5 2011 6:31 a.m. MDT

Greece's prime Minister George Papandreou, left arrives for a meeting with Greek President Karolos Papoulias, at the presidential house in Athens on Saturday, Nov. 5 2011. Embattled Greek Prime Minister George Papandreou launched efforts to form a four-month coalition government, arguing the move is vital to demonstrating Greece's commitment to remaining in the eurozone.

Kostas Tsironis, Associated Press

ATHENS, Greece — Greece's prime minister launched efforts to form a coalition government to run the country for the next four months, arguing Saturday the move is vital to securing a mammoth new debt deal and demonstrating commitment to remaining in the eurozone.

George Papandreou won an early morning confidence vote in the Socialist-led parliament on a pledge that he was willing to step aside and form a cross-party caretaker government. But it remains unclear whether the main opposition conservatives and other parties will take part in the talks and drop a demand for an immediate general election.

Hours after winning the vote, Papandreou met with President Karolos Papoulias.

"Cooperation is necessary to guarantee — for Greece and for our partners — that we can honor our commitments," Papandreou said at the start of Saturday's hourlong meeting.

"I am concerned that a lack of cooperation could trouble how our partners see our will and desire to remain in the central core of the European Union and the euro," he said.

Papandreou, midway through his four-year term, was forced into the move by his austerity-weary Socialist party after he abandoned a disastrous proposal to hold a referendum on a new European debt deal. The idea was quickly scrapped this week after throwing world markets into renewed turmoil and drawing an angry reaction from European leaders.

Frustrated with Greece's protracted political disagreements, the country's creditors have threatened to withhold the next critical €8 billion ($11 billion) loan installment until the new debt deal is formally approved in Greece.

Greece is surviving on a €110 billion ($150 billion) rescue-loan program from eurozone partners and the International Monetary Fund. It is currently finalizing a second mammoth deal: to receive an additional €130 billion ($179 billion) in loans and bank support, with banks agreeing to cancel 50 percent of their Greek debt.

"My immediate aim is to do everything I can to create a broad cooperation government ... I am not tied to my post," Papandreou said.

"Cooperation is required for the country. We must not go to elections at this moment because it would have catastrophic consequences for the Greek economy and the livelihoods of Greek citizens," he said. "The (new debt) agreement is very significant and will relieve much of the burden on the Greek citizen."

Socialist party officials insisted any new government would need until late February to secure the second deal, warning that a snap poll could scuttle it. They insisted Saturday that Papandreou's offer to step aside was sincere, and called on Antonis Samaras, leader of the conservative New Democracy party, to urgently reconsider his party's position.

"If Mr. Samaras were willing to back a new government, the prime minister would resign today," Yiannis Magriotis, a deputy public works minister, told private Skai television.

Prominent political analyst Ilias Nicolacopoulos argued it would be difficult for Samaras to avoid the coalition talks altogether — even if he remains reluctant to share power with Papandreou.

"There will be a tough game of poker — all of last week was a poker game — to determine what type of government can be formed," he told AP television.

Theodora Tongas in Athens contributed to this report.

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