Greek PM agrees to resign

Greece's President has finished hosting crunch talks between the country's Prime Minister and the main opposition chief. George Papandreou and the opposition leader have reached an agreement on forming a unity government under a new leader.

The country’s opposition has been calling on George Papandreou to resign to bring an end to the ongoing political deadlock.

Greek PM George Papandreou has agreed to resign following the introduction of a new coalition government. He will not head the interim government and the talks on details of who will form the new Cabinet will continue on Monday.

Greece's main political parties have also agreed on early elections to take place on February 19, Finance Minister Evangelos Venizelohas said.

­Journalist Zarkadoula Eirini emphasized three main points in the announcement that came after the Greek political parties reached the initial agreement over forming a new coalition government of national unity.

“First of all, they have agreed to form a new coalition government,” she said. “Second, Papandreou will not be the Prime Minister, will not be the leader in this coalition government. And third, they have to meet again in order to arrange the details.”

Zarkadoula Eirini believes that Papandreou now has no other choice but to resign to show he is a man of his word.

“Papandreou will still be the leader of his party, PASOK, even though he will not be the leader of a new coalition government,” Eirini said. “But the thing is, at first he decides to call a referendum then he changes his opinion. In a way he persuaded Antonis Samaras, the leader of conservatives, to agree with the austerity measures, with the agreements of October 26. But this situation created confusion, and now he is trying to show that he means what he says.”

George Papandreou's resignation has been on everyone’s lips for some time, though he did survive a confidence vote on Saturday, with 153 votes in his favor in the 300-member parliament. At the moment Papandreou is midway through a four-year term. However, he stated he does not want to head the next government.

"I am not interested in remaining leader of the next government," he stated.

Papandreou's resignation was requested by opposition leader Antonis Samaras. His New Democracy – one of the country’s two largest parties – has virtually exclusive power to make the much-needed coalition government work.

“I am ready to help the country, in case if he [Papandreou] steps down. If he does not resign, he does not allow the constitution to operate properly; if he does resign, the things will go as they have to,” Samaras has announced.

Former Finance Minister Evangelos Venizelos is most likely candidate to be named Papandreou’s successor. He will represent Greece at Monday’s key euro group to discuss the latest 130-billion-euro bailout package agreed on October 26.

The bailout would wipe out half of the Greece’s current debt (100 billion euro) and inject another 30 billion euro into the country’s crisis-hit private sector. In return Greece has cut government jobs, encourage privatization, and reduce budget spending.

At Venizelos’ request the new government is to govern the country for four months, paving the way for an election in early spring 2012. Papandreou discouraged intentions to hold the election immediately, as that would jeopardize the implementation of the bailout. However, the opposition still intend to hasten the election build-up.

Head of EuroCommission’s monetary affairs Ollie Rehn was quoted by Reuters earlier saying the EU is prepared for every Greek scenario including their exit from the union.