Greek Prime Minister Papandreou has won confidence vote

Unity government without Papandreou
Added on November 6, 2011 at 22:18 Italian time
Greece will be governed by a cabinet of national unity. Papandreou will no longer be part of the government. There is talk - but no confirmation so far - that the former ECB Vice President Lucas Papademos will be the new prime minister. New elections will only take place at a later stage. The cabinet list will be published on Monday.

Added on November 5, 2011 at 18:22 Italian time
There is still no unity government in sight. Opposition leader Samaras (ND) repeated his call not only for Papandreou to resign, but also to hold early elections because Papandreou had not accepted the offer the ND had made.

Correction added on November 5, 2011 at 09:59
Prime Minister Papandreou won the confidence of 153 of the 300 parliamentarians. 145 voted against him. 2 members of parliament were absent. Even the former Labor Minister Louka Katseli, who had defected and been expelled from the Pasok on October 20, voted for Papandreou, who said he would try to present an emergency government as early as today. Finance Minister Venizelos is considered the favorite for the post of prime minister. Papandreou told him he would propose him as head of the national unity government to be formed.

Added on November 5, 2011 at 01:57 Italian time
Opposition boss Samaras insisted that Papandreou had to step down as Greece's prime minister as a pre-condition for talks for the formation of a unity government. He favors a cabinet of experts, mainly to avoid his party of being tainted by brutal reforms before early elections will take place. As an opposition leader, Samaras has promised the impossible to voters, including a better bailout deal for Greece. At least, Samaras has shifted positions himself and does no longer exclude a unity government as well as accepting the bailout deal.

Although a haircut of 60% to 70% for all the state debt instead of the 50% voluntary haircut on private debt will surely have to follow to bring Greece back un a sustainable track, the task for the Greek won't become easier.

Greece needs fundamental structural reforms. The country is not competitive on the international level. It needs investments from German, French and other competitive European countries.

Papandreou is politically finished. He had announced a referendum without consulting the EU or even his Pasok party. The details of a possible referendum remained as unclear as its date. Markets however ask for facts and actions, not for weeks of uncertainty.

Papandreou first a referendum, then he backtracked. First he was against early elections, the he was in favor of a snap election. He first categorically excluded to step, then he announced that he was ready to step down if necessary.

His shifting positions and populists tactics did not go done well with Merkel, Sarkozy and Junker. They are now ready to discuss the former taboo of the possibility of Greece leaving the eurozone. Whether Greece can keep the euro or will have to create its own currency again, times will be rough for the Greek.

Greek Prime Minister Papandreou has won confidence vote
Article added on November 5, 2011 at 00:31 Italian time; vote details corrected at 09:59
The Greek Prime Minister George Papandreou has won his confidence vote, avoiding snap elections which would have endangered the EU bailout deal for Greece. Papandreou won 153 votes in the 300 member parliament. Only 298 members were present. 145 parliamentarians voted against. him.

However, before the vote, the prime minister said that he was ready to step down. After the vote, Papandreou told parliament that he was ready to discuss the formation of a unity government with the Greek president.

Finance Minister Evangelos was said to have won the backing of smaller parties to form a broader coalition government. Early elections in a few minutes are likely.

Before the vote, Papandreou had come up with the idea of a referendum, asking the Greek people to decide whether they were ready to accept the new EU bailout deal for Greece. At first, Papandreou was said to have won the backing of his cabinet. But quickly, Health Minister Loverdos, Infrastructure, Transport and Networks Minister  Ragousis, Eduction and Religious Affairs Minister Diamantopoulou and, above all, his party rival and Finance Minister Venizelos disapproved the idea of a referendum. Papandreou had no other chance than to backtrack.

The opposition was asking for his resignation anyway as a condition for a possible unity government. In the 1970s, the Greek Prime Minister George Papandreou and the opposition leader Antonis Samaras were roommates during their student years at Amherst College, Massachusetts.

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