Political shakeup
June 17, 2011
Greek Prime Minister George Papandreou announced an anticipated cabinet reshuffle on Friday, appointing Defense Minister Evangelos Venizelos as the country's new finance minister and European Parliament member Stavros Lambrinidis as foreign minister.
In one of his first acts as finance minister, Venizelos vowed to "carry out a real war" on the country's debt crisis.
"I am here by patriotic duty to carry out a real war," he said. "We ask for a political consensus to help build a social consensus ... We have to engage a mobilization."
Venizelos replaces George Papaconstantinou - the architect of the deeply unpopular austerity reforms made to meet the terms of a European Union-International Monetary Fund (IMF) bailout package. Papaconstantinou will now take over the environment portfolio.
The reshuffle also saw Deputy Defense Minister Panos Beglitis promoted to full minister. Two other key officials who had handled tough reforms, Health Minister Andreas Loverdos and Deputy Labor Minister George Koutroumanis, were given additional responsibilities, with the latter bumped up to full minister.
Heavy burden
As finance minister, Venizelos will be tasked with tackling the country's crippling debt crisis, which has eroded worldwide confidence in the euro and prompted questions over EU solidarity.
The Greek government has been trying to rein in public spending and convince the EU and IMF to provide Athens with more emergency loans to combat the country's ailing economy.
The debt-laden government is trying to generate 28 billion euros ($39.6 billion) via new taxes and spending cuts, and wants to sell state property worth roughly 50 billion euros.
Venizelos asserted that he would back the second round of austerity measures, which are set to go before parliament by the end of the month.
"It is only with the people, society and the forces of production that Greece can meet this historic challenge," he said.
"My mind is turned towards the real economy, the anxieties and Greek society's indignation," he added.
The measures, championed by Papandreou, had received little support - even from within his own party.
Nationwide protests
Papandreou had promised the cabinet reshuffle for Thursday, but decided to hold off after two prominent members of his party resigned over the planned spending cuts.
On Wednesday, Greece was hit by nationwide strikes and mass protests against the planned measures. The rallies deteriorated into pitched battles between protesters and riot police on the streets of Athens.
A vote of confidence on the new government is now expected to be held as soon as Sunday, the same day finance ministers from the 17-member eurozone are scheduled to meet for talks aimed at finding common ground on helping prevent Greece from defaulting on its mountain of debt.
Author: Charlotte Chelsom-Pill, Darren Mara (Reuters, AFP, dpa)
Editor: Nicole Goebel