Greek cabinet backs bailout referendum

Wednesday, 02 November 2011 09:26

Greece's cabinet has unanimously backed plans to hold a referendum on the EU's debt rescue package.

Prime Minister George Papandreou told an emergency cabinet meeting that a referendum would give his government a "clear mandate" for the austerity measures the country's eurozone partners have demanded.

Stock markets around the world fell on the announcement amid fears the bailout plans hammered out last week by EU leaders could collapse.

Mr Papandreou has been summoned to emergency talks with French President Nicolas Sarkozy and German Chancellor Angela Merkel and other European leaders in Cannes later today (November 2nd).

European Council President Herman Van Rompuy, European Commission President Jose Manuel Barroso, Eurogroup President Jean-Claude Juncker, and International Monetary Fund Managing Director Christine Lagarde will also be in attendance.

The meeting is taking place in the French city ahead of the G20 summit there on Thursday and Friday.

Last week, eurozone leaders agreed a 50 per cent debt write-off for Greece as well as a boost to the bailout fund.

However, the deal hinges on Greece's willingness to implement wide-ranging austerity measures.

Most commentators believe the package will be rejected by the Greek people, although the majority are said to be keen to stay in the eurozone.

Use the Myfinances.co.uk comparison tables to find the best deal on a new pension

• Tags:
• euro
,
• european funds
,
• greece
,
• news