After backtracking numerous times following his surprise announcement to hold a referendum on the deal to keep his country solvent, agreed at the last eurozone summit on 27 October, Papandreou finally resigned.
The news broke after a meeting with the President Karolos Papoulias, held in the presence of Antonis Samaras, leader of the centre-right New Democracy opposition.
A presidency statement said that Papandreou and Samaras will meet again today to discuss who would actually head the coalition government, but made clear that Papandreou would not lead the new administration. His resignation was the one term Samaras had insisted on before negotiations began.
“There will be an immediate meeting between representatives of the two sides to determine the obligations that stem from the implementation of the [eurozone summit] agreement,” Papoulias said, quoted by the daily Kathimerini.
The president added that the interim government would call elections as soon as the eurozone debt deal has been implemented. This could be by the end of February.
Papademos emerges as compromise leader
Amongst the possible candidate to succeed Papandreou, former European Central Bank Vice President Lucas Papademos is the front-runner for the role but the Harvard professor was reportedly not in Greece last night.
Another name in circulation is that of current finance minister Evangelos Venizelos, a socialist.
However, according to the daily To Vima, after bickering between Papandreou and Samaras, Papademos, 65, a widely respected figure in Greece with a strong background in both academics and finance, had emerged as the compromise choice.
Venizelos will represent Greece at today's Eurogroup meeting in Brussels. European Economic and Monetary Affairs Commissioner Olli Rehn said that he and his colleagues would insist on hearing the latest news from Greece from Venizelos.
The next prime minister’s main tasks will be to regain the trust of Greece’s eurozone partners so Athens can secure the sixth loan tranche from its first bailout.
If Greece does not receive this payment of €8 billion by around the middle of December, it faces a disorderly default. The new premier will also have to oversee negotiations for the new bailout. The measures demanded from the eurozone and the International Monetary Fund will be a sensitive political issue due to the dire state of the Greek economy and the impact this is having on most citizens.
Lucky blunder?
In an opinion piece published by Kathimerini, Nick Malkoutzis writes that Papandreou's referendum initiative, which looks like his major mistake, had in fact set in motion a chain of events that led to a happy denouement.
"Suddenly, politicians were stirred by the prospect that Greece’s membership of the eurozone and the European Union was coming to an end and that their next task would be to rebuild the country from the ashes of a bankruptcy," Malkoutzis writes, also reminding that this also led Samaras to drop his resistance to the new bailout, albeit with some caveats.
A recent opinion poll indicated that if Papandreou were to have forged ahead with plans to hold a referendum on whether Greece should stay or leave the euro, most Greeks would have voted for remaining in the eurozone. According to the poll, 68% of the 603 people questioned said they would have voted to keep the euro.
