Tuesday 8 November 2011

Loucas Papademos to be nominated as the next Greek Prime Minister

Greek media have broken the story that the new Greek Prime Minister will be Dr. Loucas Papademos.

Dr. Papademos is the former Governor of the Bank of Greece and the former Vice President of the European Central Bank. He is a career economist, currently teaching at Harvard University’s Kennedy School of Government. He has also been an advisor to Mr. Papandreou in 2010, although it is not certain what this actually entailed.

Dr. Papademos is a member of the Panhellenic Socialist Party (PASOK), and was involved in Greece’s effort to join the European Economic and Monetary Union in 2000. In this respect, there is considerable controversy over whether Greek statistical standards at the time were accurate or not, and whether the recognition of military and defence expenditure should be incurred at the point of order or delivery of weapons systems. The Bank of Greece, however, was not involved in the preparation of statistical data, and to its credit usually presents a balanced picture of the economy.

His appointment is ostensibly the result of a joint agreement between PASOK and New Democracy. In this respect, it will be necessary to view two key elements in the near future in order to understand the real level of political support he will receive:

a.     The number of votes he receives in the Parliamentary vote which will be needed to confirm him and his cabinet. We understand that Evangelos Venizelos (PASOK) remains as Minister of Finance and Deputy Prime Minister. This appointment will likely be balanced by a second Deputy Prime Minister from New Democracy.

b.     The number of votes in Parliament he will receive for the 2012 budget. This will be decisive.

It is reassuring to note that one reason the negotiations took so long was because Dr. Papademos demanded real political authority. In other words, he was not interested in being a mere caretaker. It is also reassuring that he has so much experience abroad. However, the real political power remains with the two main political parties, PASOK and ND, with the swing vote of LAOS and the centrist independents.

His formal appointment is expected this evening or tomorrow.

© Philip Ammerman, 2011

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