After several days of operatic farce alternating with tragedy, the major non-leftwing parties agreed to form a government led by Lucas Papademos. So, who is he?
A cautious, soft-spoken technocrat who, as governor of the country’s central bank, helped bring Greece into the eurozone in January 2001, Lucas Papademos becomes prime minister of a transitional government with virtually the sole objective of keeping Greece within the single currency.
Born in Athens in 1947, Papademos attended the Massachusetts Institute of Technology (MIT), where he earned a bachelor’s degree in physics in 1970, a master’s degree in electrical engineering in 1972, and a PhD in economics in 1978. Taught economics at Columbia University from 1975 to 1984, and at the University of Athens from 1988 to 1993.
Senior Economist at the Federal Reserve Bank of Boston in 1980, and joined the Bank of Greece (BoG) in 1985 as chief economist, rising to deputy governor in 1993 and taking over as governor in 1994.
Was widely condemned in the late 1990s for suggesting - rightly as it turned out - that Greece's stock market was a dangerous bubble.
During his tenure at the BoG, Greece switched from the drachma to the euro.
Left the BoG in 2002 to become vice-president of the European Central Bank (ECB) under president Jean-Claude Trichet until 2010.
He's been advising the outgoing PM since on economic matters, which is not really reassuring given how badly the crisis has been handled, though I do like the fact that his first degree was Physics.
The new government will be sworn in tomorrow but the farce of the last few days has weakened it before its birth.
The power-sharing deal was struck after days of byzantine negotiations and embarrassing political theater which appeared to push Greece closer to default and a eurozone exit.
Marathon negotiations hit a deadlock on Wednesday night following differences between -- as well as within -- the Socialist and conservative parties. A large number of PASOK MPs, as well as ND deputies, on Wednesday were said to be vehemently opposed to the apparent choice of Parliament Speaker Filippos Petsalnikos -- a close associate of Papandreou and a party stalwart -- for interim premier.
In a sign of the daunting tasks ahead, Greece's national statistics agency ELSTAT on Thursday reported that the unemployment rate increased to 18.4 percent in August from 16.5 percent in July and 12.2 percent a year earlier. The number of unemployed hit 907,953 in August, a 10.7 percent increase from the previous month.
Papandreou, who never recovered from his explosive decision to put the European rescue package to a referendum, has agreed to step down to make way for the new government. In a bow-out address on Wednesday, the PASOK leader said the apparent breakthrough had rescued the country's membership of the eurozone.
“I am proud that, despite the difficulties, we avoided bankruptcy and ensured the country stayed on its feet,” Papandreou said. “I want to wish the new prime minister success, I will support the new effort with all my strength,” he said.
To get a taste of how the public and the press reacted to all this:
“Operetta at the Megaron” said Eleftherotypia, using a double entendre (megaron refers both to the presidential mansion and the Athens music hall).
“Operetta! The leaders, the gardener and poor Greece” exclaimed Ta Nea’s headline, in the form of an opera name. Act I: Papandreou decides to make Petsalnikos prime minister. Act II: Venizelos and MPs from both Pasok and ND react [negatively]. Act III: Samaras-Papandreou sip coffee and Karatzaferis puts on a show. Act IV: Petsalnikos’ candidacy is burned and Papademos is besieged [courted by Papandreou and Samaras] all night.
“There she is, there she is: the prime minister!” declared the headline of weekly Pontiki, featuring a photograph of German Chancellor Angela Merkel.
Many Greeks noted that the leaderless days were actually quite good. Several tax evaders were arrested, there were no strikes and the country ran more smoothly. Popular satirical show Radio Arvila poked relentless fun at the political establishment. If you speak Greek, you'll really enjoy their clips.