After four days of political wrangling that threatened to jeopardize international rescue loans and the country's future in the Eurozone and the EU, rival Greek leaders have agreed that former European Central Bank (ECB) Vice-President Lucas Papademos will head a coalition government and deal with keeping the aid coming, and the harsh austerity measures that come with them.

Papademos, 64, an independent, was the choice of Socialist Prime Minister George Papandreou, who agreed to step down after two tumultuous years in office, and Conservative New Democracy party leader Antonis Samaras.

Papademos has served as a National Bank of Greece Governor, and oversaw Greece's flawed entry into the Eurozone a decade ago.

An immediate front-runner for the prime minister post, Papademos nearly fell out of contention after it was reported that the rival parties didn't want to cede too much power to him, nor give him control of the coalition cabinet.

In the end, he got what he wanted, according to media reports: no political interference in the government he will head until the elections, tentatively set for February 19th.

"Greece is at the crossroads," Papademos told journalists outside the Presidential Palace, calling for "unity, understanding and wisdom ... to deal with the problems in the best possible manner." He added that, "It is a great honor. But the responsibility is greater."

"I am convinced that the country's participation in the Eurozone is a guarantee for monetary stability. We must all be optimistic about the final result, as long as we are united."

The EU-IMF-ECB Troika -- which lent Greece 109 billion euros in a first bailout, and is now sitting on a second deal of 130 billion euros -- warned the money would be withheld unless a new coalition government was named.

Papademos faces a tough job, including a first round of strikes next week.

The rise in prices when Greece adopted the euro as a currency and easy credit were major causes of the current economic crisis, along with generations of packing political hires onto the public payroll, corruption, tax evasion, an uncompetitive economy and lack of foreign investment.

Papademos gained credit for bring down rising inflation during his tenure at Greece's central bank and tried to impose monetary discipline on a country used to wild overspending.

His appointment to the ECB was the highest for a Greek in an international post and gave him standing with the politicians and bankers he will now have to deal with.

"He is a wise person. It is important that he has dealt with substantial issues in the past," political analyst Antonis Karakousis of Papademos in an interview with SKAI radio.

The announcement caused a bump in the Athens stock exchange and helped Greece's struggling banks, if only temporarily.

 

 

 

- Provided by Southeast European Times