Greek rivals continue new PM talks

 

Greece's two biggest parties have resumed talks on who should be the new prime minister after agreeing a power-sharing deal to accept a massive financial rescue package.

Fellow European governments will want concrete progress when eurozone finance ministers meet to discuss the possibility of unfreezing bailout loans that had been kept on hold while the country sorted its political turmoil.

Negotiators from the Socialist government and opposition conservatives held fresh talks to hammer out the composition of the new 15-week government, which will be tasked with passing the package from the country's international creditors before elections. Prime Minister George Papandreou and opposition leader Antonis Samaras were also expected to hold further talks.

Former European Central Bank vice president Lucas Papademos is being tipped as the most likely new head of the government that would serve until a February 19 general election.

Officials in Greece's two main political parties have confirmed that the 64-year-old former central banker is a candidate although there is no indication yet he would want the job, for however short a period.

None of the people being considered have been announced publicly.

The power-sharing talks were due to be concluded by the end of the day, with former EU Environment Commissioner Stavros Dimas, a conservative, also being considered for a senior government position.

Mr Papandreou's popularity took a battering last week after his call for a referendum on Greece's latest rescue package, that was agreed less than two weeks ago.

Although the referendum was scrapped after Greece's main conservative opposition said it agreed to the broad outlines of the rescue deal, markets remain in a jittery state, especially as the country needs the next batch of bailout cash within weeks to pay off debts.

European governments remained cautious as they awaited developments on the composition of Greece's new government.

"What is clear is that the European partners are becoming more and more intransigent with Greece and they will want evidence of concrete advances on Monday evening," said Silvio Peruzzo, an analyst at Royal Bank of Scotland.

AP

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