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Greek talks to name interim leader continue Greek talks to name interim leader continue
(about 1 hour later)
Greece's political leaders are locked in talks for a third day as they try to agree on an interim prime minister to lead a unity government. Greece's political leaders are locked in talks for a third day as they continue to hammer out details of a unity government.
Initial reports that a candidate had been agreed failed to materialise and Greek media have suggested new names. Initial reports that a candidate for PM had been agreed failed to materialise, but sources in Athens have told the BBC a deal has now been reached.
Amid the hiatus, Greece's European partners are increasing pressure for the impasse to be resolved. Government sources say outgoing PM George Papandreou will address the nation before meeting the president.
If a unity government is not formed Greece risks losing vital bailouts it needs to avoid bankruptcy. Without a unity government, Greece risks losing an EU bailout.
On Wednesday, French President Nicolas Sarkozy spoke by telephone to outgoing Greek Prime Minister George Papandreou who promised an "imminent" Greek cabinet, Mr Sarkozy's office said. That would force the country into bankruptcy and a possible exit from the European single currency.
Names in the frame
Greece's European partners are stepping up the pressure for a solution.
On Wednesday, French President Nicolas Sarkozy spoke by telephone to Mr Papandreou, Mr Sarkozy's office said.
Mr Papandreou told the French president that "a new government with the support of the ruling majority and the opposition will be set up imminently", it added.Mr Papandreou told the French president that "a new government with the support of the ruling majority and the opposition will be set up imminently", it added.
Earlier, a Greek government source told reporters that Mr Papandreou was expected to visit President Carolos Papoulias "within the day" to name an interim leader. The name of the interim prime minister and the outline of the unity government are expected to be discussed when Mr Papandreou meets President Carolos Papoulias.
A deal was close. Then it was off. Now it is unclear where we stand. The wrangling here is paralysing the country. "Sinking without a captain," reads one headline today. Why the delay?A deal was close. Then it was off. Now it is unclear where we stand. The wrangling here is paralysing the country. "Sinking without a captain," reads one headline today. Why the delay?
One sticking point is the reluctance of the opposition leader, Antonis Samaras, to accept an EU demand to sign a document committing his party to the latest vital bailout package. He says he will back it, but seems to be held back by some of his MPs who oppose the austerity demanded in return for the deal.One sticking point is the reluctance of the opposition leader, Antonis Samaras, to accept an EU demand to sign a document committing his party to the latest vital bailout package. He says he will back it, but seems to be held back by some of his MPs who oppose the austerity demanded in return for the deal.
And then Lucas Papademos, previously considered the frontrunner, is said to want more control over naming ministers. He apparently feels that the 100-day period envisaged for this government is too short.And then Lucas Papademos, previously considered the frontrunner, is said to want more control over naming ministers. He apparently feels that the 100-day period envisaged for this government is too short.
So new names are being touted and Greece watches and waits. Without political stability here, there can be no resolution of the debt crisis. Greeks are losing patience.So new names are being touted and Greece watches and waits. Without political stability here, there can be no resolution of the debt crisis. Greeks are losing patience.
State TV then reported that Mr Papandreou would meet the president at 15:00 GMT.
On Tuesday, Greek media speculated that former European Central Bank vice-president Lucas Papademos was about to be appointed interim prime minister.On Tuesday, Greek media speculated that former European Central Bank vice-president Lucas Papademos was about to be appointed interim prime minister.
However, reports emerged that his candidacy had run into trouble.However, reports emerged that his candidacy had run into trouble.
Other possible candidates being named by the media on Wednesday included Vassileios Skouris, president of the European Court of Justice.Other possible candidates being named by the media on Wednesday included Vassileios Skouris, president of the European Court of Justice.
The Athens News named Ioannis Koukiadis, a law professor and former Socialist labour minister, as a possible contender.The Athens News named Ioannis Koukiadis, a law professor and former Socialist labour minister, as a possible contender.
The names of Nikiforos Diamandouros, Greece's European ombudsman, and Panagiotis Roumeliotis, Greece's representative to the International Monetary Fund (IMF), have also been circulated in the past few days. The names of EU ombudsman Nikiforos Diamandouros and Panagiotis Roumeliotis, Greece's representative to the International Monetary Fund (IMF), have also been circulated in the past few days.
Negotiations have been taking place between Mr Papandreou and Antonis Samaras, leader of the biggest opposition party, New Democracy.Negotiations have been taking place between Mr Papandreou and Antonis Samaras, leader of the biggest opposition party, New Democracy.
Adding to the uncertainty, Mr Samaras became embroiled in a row with the EU over Greece's pending bailout programme.Adding to the uncertainty, Mr Samaras became embroiled in a row with the EU over Greece's pending bailout programme.
EU economic affairs commissioner Olli Rehn said he wanted the heads of Greece's two main parties to commit in writing to the terms of the bailouts before Athens could receive the next instalment.EU economic affairs commissioner Olli Rehn said he wanted the heads of Greece's two main parties to commit in writing to the terms of the bailouts before Athens could receive the next instalment.
But Mr Samaras balked at the idea, saying he regarded the rescue deal as "inevitable" but saw no need for a written pledge.But Mr Samaras balked at the idea, saying he regarded the rescue deal as "inevitable" but saw no need for a written pledge.
Greece needs the next tranche from the first bailout - worth 8bn euros (£6.8bn; $11bn) - to avoid running out of money within weeks.Greece needs the next tranche from the first bailout - worth 8bn euros (£6.8bn; $11bn) - to avoid running out of money within weeks.
Last month, EU leaders agreed a separate bailout deal which gives the government 130bn euros (£111bn; $178bn) and imposes a 50% write-off on private holders of Greek debts, in return for deeply unpopular austerity measures.Last month, EU leaders agreed a separate bailout deal which gives the government 130bn euros (£111bn; $178bn) and imposes a 50% write-off on private holders of Greek debts, in return for deeply unpopular austerity measures.