Greece Selects Former European Central Bank Official for New Prime Minister

Athens – Lucas Papademos, a respected economist with an avuncular style, was named prime minister of Greece on Thursday. He will lead a unity government that has pledged to quickly approve the tough terms of a European aid package and save the country from bankruptcy.

The choice of Mr. Papademos, a former vice president of the European Central Bank, came after four days of tense negotiations that put Greece’s feuding political parties on full display.

A written statement issued by the office of President Karolos Papoulias was read on television in the afternoon confirming Mr. Papademos’s appointment and adding that the “chief role of the new interim administration will be the implementation of the decisions of the European Union summit of Oct. 26 and the policies that are connected to this.”

Mr. Papademos made a brief appearance shortly after the announcement. He said Greece still faced dire problems. But he struck an optimistic note.

“The course will not be easy,” he said. “But the problems, I’m convinced, will be solved. They will be solved faster, with a smaller cost and in an efficient way, if there is unity, agreement and prudence.”

After months of domestic protests and building pressure from the European Union, Prime Minister George Papandreou agreed on Sunday to step down once a coalition government had been formed. But the talks dragged on, apparently hostage to political maneuvering by all sides.

Mr. Papademos, however, is seen as outside the old-boy networks of Greek politics — a technocrat, perhaps able to take Greece on a new path.

News reports earlier this week said that Mr. Papademos was insisting on several measures he believed were crucial to his success, including a minimum of at least six months at the helm. Earlier, Greece’s major political parties had agreed to new elections in just 100 days.

The reports also said that he insisted that members of the opposition New Democratic Party play a significant role in the unity government, which will have to impose additional austerity measures almost immediately.

The opposition, led by Antonis Samaras, had resisted, not wanting to be linked to deeply unpopular reforms.

But standing outside the presidential palace, Mr. Papademos said he had not made any demands before accepting the job. He also said the new unity government would be “transitional,” and its priority would be to ensure that Greece stayed in the euro zone. “I am convinced that Greece’s continued participation in the euro zone is a guarantee for the country’s stability and future prosperity,” he said.

He faces a difficult task. He will have to move swiftly to reassure the country’s major foreign lenders — the so called troika comprising the European Commission, the European Central Bank and the International Monetary Fund — who were shocked when Mr. Papandreou decided without warning to submit the latest bailout package to a referendum, a move that eventually led to his demise.

Mr. Papademos must also persuade the Greek Parliament to pass the new austerity measures, which include more layoffs of government workers, in a climate of growing social unrest.

Mr. Papandreou went on national television on Wednesday evening to announce that a new interim government had been formed.

But he did not name his successor, and in the hours that followed, it became clear that political confusion had set in once more. Television provided glimpses of some of the drama. A furious Giorgos Karatzaferis, the leader of the small far-right party Laos, stormed out the presidential office building shortly after Mr. Papandreou’s speech. He told waiting reporters that he had been summoned to a meeting with Mr. Papandreou; the president; and Mr. Samaras, but found himself sitting in a hall alone. Apparently, the other men were too busy arguing to meet with him.

Mr. Karatzaferis, one of the few politicians willing to risk the potential damage from supporting a new power-sharing government that must take on a host of unpopular tasks, said political games were being played. “This is unacceptable,” he huffed before leaving.

Some Pasok members had appeared to push publicly on Wednesday for Mr. Papademos, a respected economist and former vice president of the European Central Bank who was seen as being a dynamic and technically able choice.

But his strength made him a potential rival for those who have aspirations in the next elections, analysts said. In addition, reports that Mr. Papademos had set several conditions for taking the job, including a six-month term and the ability to choose his own finance minister, had troubled some members of both parties. In fact, Mr. Papademos was acting to remove one of the most powerful members of Pasok, the current finance minister, Evangelos Venizelos, who was likely to run for prime minister in the next elections.

Nonetheless, many of the younger politicians were eager for someone who would make quick progress in getting the country’s financial house in order. One prominent member of Pasok, Anna Diamantopoulou, the minister of education, issued a letter on Wednesday that was widely interpreted as public support for Mr. Papademos.

“The country needs a prime minister of high status and acceptance, both inside and out of the country, with deep knowledge of financial affairs,” she wrote.

Mr. Papandreou’s televised address served as a kind of valedictory speech, summing up moves in recent years to stabilize and help the country, expressing the country’s continued commitment to the European bailout plan and urging political parties to transcend their differences.

Ahead of the meeting with the Mr. Papoulias, Mr. Papandreou said the country’s new government would signal the “beginning of a new political mentality, a new political culture.”

“Today, we leave aside our differences,” he said, heralding “a common effort to ensure the country moves forward, not only to remain part of the euro zone but also to emerge from the crisis.”

He said the interim government would make the necessary efforts to “justify the sacrifices made by the Greek people over the past two years,” referring to a raft of wage and pension cuts as well as hefty tax increases. The chief goals would be to secure crucial rescue financing for the country and continue talks with foreign creditors, he said.

Some interpreted the tone of his speech as signaling his departure not only from Greek politics but also from the country itself.

“I never put my position above the national good,” he said. “For me, Greece is above everything. Wherever I go, I will carry the Greek flag in my heart.” He added that he would do everything he could to support the new prime minister and the new government.