ATHENS (AFP) – Greek Prime Minister George Papandreou axed his finance minister Friday amid the country's crippling dead crisis, promoting defence minister Evangelos Venizelos to the post, a spokesman said.
Papandreou moved George Papaconstantinou to the environment ministry, a move analysts see as a demotion.
|AFP - Greek Prime Minister George Papandreou axed his finance minister Friday amid the country's crippling dead crisis|
Venizelos, a 54-year-old party veteran who had challenged Papandreou for the party leadership in 2007, was also promoted to deputy prime minister alongside Theodoros Pangalos, outgoing government spokesman George Petalotis said in a televised address.
The new finance minister, who hails from the northern metropolis of Thessaloniki, is a no-nonsense constitutional expert and gifted speaker who previously headed Greece's frenetic preparations for the 2004 Olympic Games.
The announcement came a day after a party revolt by backbenchers disgruntled by Papandreou's handling of the country's debt crisis and his failure to agree on a unity government with opposition leaders.
Two lawmakers quit their posts and a stormy party meeting ensued in which Papandreou faced down his critics with the backing of key ministers.
Papandreou on Friday also named a new foreign minister, 49-year-old Stavros Lambrinidis, formerly head of the ruling party's group of deputies at the European Parliament and a long-term confidant of the PM when the latter held the post a decade ago.
The reshuffle also saw deputy defence minister Panos Beglitis, another close aide of Papandreou, promoted to full minister.
Two other key officials who had handled tough reforms, Health Minister Andreas Loverdos and deputy labour minister George Koutroumanis, were given additional responsibilities, with the latter bumped up to full minister.
A number of dissenters were given junior ministry posts. Papandreou also axed two of his close associates, former finance minister Dimitris Droutsas and former environment minister Tina Birbili, who had both drawn fire within the party.
A former health policy professor at the London School of Economics, Elias Mossialos, was named government spokesman.
A vote of confidence on the new government is expected to be held as early as Sunday when eurozone ministers are scheduled to meet in an effort to find common ground on saving Greece from a looming debt default.
The new government must then push through parliament a controversial new package of reforms, worth over 28 billion euros ($40 billion), by the end of the month.
The package is demanded by Greece's international creditors as a condition for new aid, but the new cuts have brought thousands of protesters outside the Greek parliament on a daily basis.
The European Union has sought to buy time in order to cobble together a second bailout package for Greece, whose debt crisis threatens to place a huge strain on the euro.
Brussels is deeply divided over how to bring on board the private sector to share part of the burden after a breakdown in talks among finance ministers this week.
The EU's economic affairs commissioner Olli Rehn has pointed to a possible short-term fix, arguing that backers from the 17-nation eurozone should agree at 11th-hour talks in Luxembourg on Sunday and Monday to provide Greece with their 8.7 billion euro share of a 12 billion euro fifth tranche of loans due to Athens under last year's first bailout totalling 110 billion euros.
He said he expected the 3.3 billion euro portion due from the International Monetary Fund, which has been in doubt following an expert review of Greek economic reforms and awaiting political approval in Athens, to follow.
The IMF had earlier said it was prepared to continue supporting Greece in its debt crisis, but only if Athens adopts agreed economic measures.