Greek PM calls referendum on new EU aid dealBy Dina Kyriakidou and Harry Papachristou
ATHENS | Mon Oct 31, 2011 6:50pm EDT
(Reuters) - Greek Prime Minister George Papandreou called an unexpected referendum on Monday on the EU bailout deal for his debt-ridden country, a move that could necessitate a snap election if a public angry with swinging austerity measures rejects the deal.
Pressured by his own lawmakers to share the heavy political burden of belt-tightening with other parties, Papandreou said he needed wider political support for the fiscal measures and structural reforms required by international lenders.
"We trust citizens, we believe in their judgment, we believe in their decision," he told ruling Socialist party deputies. "In a few weeks the (EU) agreement will be a new loan contract... we must spell out if we are accepting it or if we are rejecting it."
Analysts said holding a referendum was a baffling decision, given that the latest survey showed a majority of Greeks taking a negative view of the bailout deal.
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Analysts view: reaction to calling of Greek referendum-=-=-=-=-=-=-=-=-=-
WRAPUP 2-Greek government struggles after bailout bombshell* PM calls shock referendum on second bailout package
* Polls show most Greeks oppose deal
* Opposition parties protest, want snap elections
* Cabinet meeting in afternoon
By Dina Kyriakidou and Harry Papachristou
ATHENS, Nov 1 (Reuters) - Greek Prime Minister George Papandreou faced calls from within his own party to step down on Tuesday after he threw the nation's euro zone membership into jeopardy by calling a referendum on a bailout package agreed only last week.
A leading lawmaker from Papandreou's socialist party quit while two others said Greece needed a government of national unity followed by snap elections, which the opposition also demanded.
The leaders of France and Germany scrambled to limit the damage to the wider euro zone, and European politicians expressed incredulity at an announcement that caught everyone by surprise -- including Papandreou's own finance minister.