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Papandreou appears set to step down (Photo: France Diplomatie)

Papandreou pulls back from referendum

Greek Prime Minister George Papandreou has backed away from holding a referendum on a €130 EU bail-out deal and has agreed to talks with the conservative opposition over the construction of a transitional government leading to early elections.

Papandreou said after an emergency cabinet meeting that the referendum “was never a purpose in itself”.

It appeared earlier in the day that the leader was readying himself to step down and was likely to be replaced by a former vice-president...

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