Monday

22nd Apr 2019

ECB man to rule Greece for 15 weeks

  • Papademos (L) in a huddle with former ECB chief Trichet at the EU Council in Brussels (Photo: consilium.europa.eu)

Lucas Papademos, a former vice-president of the European Central Bank (ECB), is to be sworn in as prime minister of Greece for a 15-week period in which he will pass laws on an EU bail-out package.

Following four days of back-room horsetrading between Pasok, the socialist party of George Papandreou, and Antonis Samaris, the head of the centre-right New Democracy party, it was agreed on Thursday (10 November) that Papademos would take over the premiership.

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Greece requires "unity, understanding and wisdom," he told reporters in his first statement as acting head of government.

"The Greek economy is facing huge problems despite the enormous efforts made ... The course will not be easy," he went on. "It is a great honour. But the responsibility is greater."

The banker, who helped run the ECB until last year, is designed to be an apolitical technocrat unassociated with party allegiances.

He is to lead a new administration of national unity - a cross-party formation demanded by the EU and core European powers to overcome fears that Papandreou could lose his wafer-thin majority in parliament, unravelling agreements with international lenders.

The often bitter clashes between Pasok and New Democracy had undermined market confidence that Greece's austerity programme will be upheld in the face of massive civil unrest.

EU leaders both publicly and behind the scenes pressed the Greek establishment to find an alternative to Papandreou to guarantee the EU-International-Monetary-Fund imposed programme of spending cuts and structural adjustment will go through in return for a fresh €130 billion rescue operation.

The previous choice of Filippos Petsalnikos, the speaker of the parliament, to replace Papandreou, foundered when MPs from both New Democracy and Pasok objected to a candidate viewed as being too close to the outgoing PM.

Papademos' demand for a longer term than either side had envisaged for a transitional government proved too much for the government and opposition, however.

He is to be sworn in at 2pm local time on Friday. But he will govern for just 15 weeks in order to shepherd the new bail-out package and its attendant austerity requirements through parliament. Snap elections are likely to follow.

A third group, the far-right religious party, Laos, has also signed up to support the new administration.

But the arrangement has been damned as "unconstitutional" by others.

The Communist party and the left-wing Syriza alliance both denounced the appointment of an unelected prime minister at the behest of international monitors.

"This is the will of Greek plutocracy and the EU," the Communist party said a statement. The faction, along with other parties on the left, have seen a surge in support in the wake of the crisis.

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