Papandreou to tender resignation Wednesday

Greece announced Wednesday that Prime Minister George Papandreou would resign, handing his resignation in to President Karolos Papoulias. Negotiations to pick a new prime minister hit a snag early only hours after former European Central Bank Vice President Lucas Papademos, a respected economist, was close to being named. CNN reported that Papandreou phoned French President Nicolas Sarkozy to tell him the new Greek government would have support from opposition and majority members of Parliament. Hanging in limbo is not only the government, but the Greek financial bailout. Finance leaders in Europe have insisted that Greece sign a letter stating it intends to stick with the austerity budget plans in order to qualify for the next disbursement of bailout funds. Reports in Greece say Finance Minister Evangelos Venizelos informed members of the Cabinet that Papandreou and his successor, opposition leader Antonis Samaras and the governor of the Bank of Greece would be expected to sign the letter of intent. Concerning Papandreou's replacement, the latest person mentioned as the likeliest contender Wednesday was Vassilis Skouris, president of the European Court of Justice, and observers didn't rule out a surprise challenger to succeed Papandreou, The New York Times reported. Media outlets this week reported Papademos was the top choice to succeed Papandreou, who said he would resign once political negotiators establish a new unity government. Negotiations bogged down Tuesday when opposition party leader Antonis Samaras recoiled at a demand by the European Union's group of finance ministers that the five top Greek leaders commit in writing to the terms of an expanded bailout reached last month, the Times said. "There is such a thing as national dignity," Samaras said in a statement. "I have repeatedly explained that in order to protect the Greek economy and the euro, the implementation of the Oct. 26 agreement is inevitable." European Economic and Monetary Affairs Commissioner Olli Rehn said without the signed documents, Greece would not receive the loan installment of $10.9 billion it is expecting, ekathimerini.com reported.