New Greek govt takes charge under Lucas Papademos

Greece's new technocrat Prime Minister Lucas Papademos took charge on Friday of an interim coalition government that will seek to push through tough economic reforms and ensure the country avoids a catastrophic default.

Papademos, a former European Central Bank vice president, leads a government including ministers from three parties. Although the vast majority of posts are retained by members of outgoing Prime Minister George Papandreou's Socialists, the bitter rivalry between that party and the conservatives of Antonis Samaras is being at least temporarily set aside as Greece's politicians struggle to put the country back on track financially and ensure it can retain its cherished position in the eurozone.

"The new cooperation government will do the best it can to address the country's problems, and I believe that with the cooperation of all - and the new government stresses this - and the unity of all, we will achieve that," Papademos told Papandreou.

Finance Minister Evangelos Venizelos retained his post, the conservatives got the key positions of foreign affairs and defense, and ministerial positions also went to members of a small right-wing party with nationalist leanings.

"We can all together, under conditions of national unity and social cohesion, overcome the crisis, implement a tough program that requires sacrifices, but that at the end opens up prospects, hope, for the rebuilding of the country and the economy," Venizelos said.

Papademos - who was appointed on Thursday after two weeks of political turmoil that infuriated European leaders, horrified Greeks and led to mayhem on international markets - must now ensure his government passes Greece's latest debt deal : a euro 130 billion ($177 billion) agreement reached by the European Union on October 27.

It includes provisions for private bondholders to forgive 50 per cent, or some euro 100 billion, of their Greek debt holdings, details of which the new government will have to negotiate. He also must secure the next euro 8 billion installment of the country's initial euro 110 billion eurozone and International Monetary Fund bailout, without which Greece will default in a matter of weeks.

Speaking during the new government's first cabinet meeting, Venizelos stressed the country must carry out its pledges quickly so the eurozone's finance ministers can unblock the next installment of cash on November 17.

Greece's new interim government was welcomed by the leaders of Germany and France, Europe's two largest economies - as well as the head of the eurozone and the European Commission president, who all stressed the new government must now quickly implement its pledges.

- With inputs from agencies