Greek leader ‘to offer to resign’

Mr Papandreou’s referendum plan has failed to win the support of many of his MPs

Greek Prime Minister George Papandreou is expected to offer his resignation within the next half-hour, sources in Athens have told the BBC.

Mr Papandreou will meet Greek President Karolos Papoulias immediately after an emergency cabinet meeting has finished.

He is expected to offer a coalition government, with former Greek central banker Lucas Papademos at the helm.

Mr Papandreou himself would stand down, the BBC understands.

The Greek government was on the verge of collapse after several ministers said they did not support Mr Papandreou’s plan for a referendum on the EU bailout.

The bailout would give the heavily indebted Greek government 130bn euros (£111bn; $178bn) and a 50% write-off of its debts, in return for deeply unpopular austerity measures.

On Thursday, main opposition leader Antonis Samaras of the centre-right New Democracy party called for a caretaker government to safeguard the EU deal.

Shadow over G20

Mr Papandreou had called a vote of confidence for Friday. His Pasok party holds a slim majority, 152 out of 300 seats.

However, he was faced with a parliamentary revolt after several of his MPs withheld their backing. Some called for early elections or a government of national unity instead.

The row threatens to overshadow a meeting of the G20 in Cannes, where leading industrialised nations are to discuss the eurozone debt crisis.

Mr Papandreou told reporters in Cannes his referendum would in effect be a vote on whether Greece should remain in the euro.

But the European Commission said if Greece left the European single currency, it would have to leave the European Union as well.

“The treaty doesn’t foresee an exit from the eurozone without exiting the EU,” spokeswoman Karolina Kottova told a briefing in Brussels.

Earlier, the chairman of the group of eurozone countries, Jean-Claude Juncker of Luxembourg, said plans were in place for a Greek exit from the euro.

“We are absolutely prepared for the situation that I have described and do not want to see come about,” Mr Juncker told German ZDF television.

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