Former Vice President of the European Central Bank (ECB) has been named leader of the Greek Provisional Government. After days of deliberation Greek political parties have agreed that Lucas Papademos will lead the provisional government that will be charged with implementing the austerity measures required for a European bailout of Greece. The 64 year old economist was the European Central Bank’s Vice President from 2002 to 2010.
The Greek population is vehemently opposed to any austerity measures and the provisional Greek government will have an arduous task of implementing them. Former Greek Prime Minister Papandreou resigned earlier this week after agreeing to conditions set by Sarkozy and Merkel for a renewed Greek bailout.
The forming of the provisional government in Greece demonstrates that at least the political entities have recognized the severity of the crisis ant that action is needed.
Greece has become a bit of a sideshow, with Italy, Spain and Portugal nearing the brink of a default. The Eurozone will be hard pressed to bailout Italy, one of the world’s largest economies. In comparison the the Greek bailout is a pittance. The forecast of economic growth in Europe is said to be at a standstill and only 0.5% of growth is expected. Any increase in interest rates for Italy would be a disaster for an economy that is too large to bailout and too large to fail. EU unemployment rates are expected to stall at 9.5%.
The swearing in of the new Greek government is to take place at 12:00pm GMT on November 11th.
Profile: Lucas Papademos
Lucas Papademos, Greece’s technocrat new prime minister, is a former European Central Bank (ECB) vice-president who is seen as well placed to handle the debt crisis.
The 64-year-old is well known in Europe’s capitals.
As head of the Bank of Greece, he oversaw his country’s move from the drachma to the euro in 2002.
More recently, as an adviser to outgoing Prime Minister George Papandreou, he took part in the negotiations between Athens and the “troika” of international creditors (the IMF, the European Commission and the European Central Bank) bailing out the Greek government.
His career has crossed the academic and policymaking worlds.