Greece's Leadership Crisis: Giorgios Papandreou

Amid growing fears of a government collapse in Athens, Prime Minister Papandreou scrapped plans for a bailout referendum but, referencing European unity, has refused to step down.

What's the Latest Development?

The Greek Prime Minister has called off plans to hold a referendum over a new bailout package being offered by the European Union. The move came after Papandreou acquiesced to domestic demands that he form a cross-party government to solve the country's debt crisis. The initial announcement of the referendum came as an unwelcome surprise for all those, including France and Germany, who are cutting hard deals with the continent's central and private banks so that Greece can remain in the Eurozone. 

What's the Big Idea?

Were the referendum to go ahead, and were the Greek citizenry to reject the E.U.'s bailout package, it would amount to a disorderly Greek departure from the Eurozone. The consequences would be nearly unprecedented: a bankrupt country with no plan for solvency. Papandreou faces a no-confidence vote on Friday, which members of his own party recommend he avoid by resigning. But Papandreou refuses to resign, saying that a public election at this time would ensure Greece's departure from the E.U.

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