New Greek premier in place

LITTLE ROCK — Greek conservative party head Antonis Samaras was sworn in as prime minister Wednesday at the helm of a three-party coalition that will uphold the country’s international bailout commitments.

The move ends a protracted political crisis that had cast grave doubt over Greece’s future in Europe’s joint currency and threatened to plunge the continent deeper into a financial crisis with global repercussions.

“Greece has a government,” said Evangelos Venizelos, a former finance minister and leader of the socialist PASOK party after a second round of talks with Samaras.

But the new government has challenges ahead: It must deliver on pledges by its predecessors to generate huge new savings, privatize publicly owned companies and real estate, cut about 150,000 civil service jobs in coming years and open restricted professions to competition.

Samaras, a U.S.-educated 61-year-old economist, was sworn in three days after his New Democracy party won the second national elections in six weeks but without enough votes to form a government on its own. He is Greece’s fourth prime minister in eight months.

German Chancellor Angela Merkel congratulated Samaras by phone and wished him “luck and success in the difficult work that lies ahead of him,” the German government said.

Germany is the main contributor to Greece’s two multibillion-dollar rescue loan packages.

The conservatives will join forces with the socialist PASOK party, and came in third place, and the smaller Democratic Left led by Fotis Kouvelis. Discussions on the lineup of ministers were expected to be completed by Wednesday night.

“I will ask the new government that will be formed tomorrow to work hard so that we can offer tangible hope to our people,” Samaras told reporters as he left the presidential mansion.

Greek stocks rose marginally in response to the news, with Athens shares closing up 0.5 percent, limiting earlier gains.

Analyst Theodore Krintas said he expected markets to welcome the breakthrough.

“The formation of a government ... will take part of the uncertainty away and at the same time hopefully will take Greece out of the [headlines] of the mass media all over the world,” said Krintas, managing director of Attica Wealth Management.

Samaras, Venizelos and Kouvelis met Wednesday evening with Giorgos Zanias, who served as finance minister in the month-long caretaker government between the May 6 and June 17 elections and was a key negotiator for Greece’s bailout. The meeting also was attended by National Bank of Greece Chairman Vasilis Rapanos, who is tipped to succeed Zanias as finance minister.

Discussion centered on a meeting of the 17-nation eurozone’s finance ministers today in Luxembourg, at which Zanias will represent Greece.

All three parties broadly back Greece’s pledges to bailout creditors for further austerity and changes, but have pledged to renegotiate some of the terms for the rescue loans. Samaras campaigned on promises to lower taxes, restart the economy and increase the incomes of low earners, large families, police and fighter pilots.

New Democracy and PASOK also are looking for an extension of at least two years in the deadlines for implementing fresh cutbacks worth $18.42 billion.

Kouvelis of the Democratic Left went a bit further Wednesday, saying that Greece should eventually “disengage” from the austerity commitments and “lift those measures that have literally bled society.”

A German government spokesman said Wednesday that forecasts over whether Greece will be given more time to fulfill its bailout obligations is “pure speculation” before a team of experts from the socalled troika reports on the state of Greek finances.

After a government is formed in Athens, EU officials will visit Greece and decide how to proceed, German government spokesman Georg Streiter told reporters in Berlin.

The euro-group talks that Zanias will attend today “will be the first big battle on the revision of the bailout agreement, the creation of a framework that will allow us to move to positive growth and to combat unemployment, which is the big problem of Greek society,” Venizelos said Wednesday.

Greece has been dependent on the loans from other eurozone countries and the International Monetary Fund since May 2010. In return, it has imposed deep spending cuts, lowered salaries and pensions, and repeatedly raised taxes.

Earlier Wednesday, hundreds of poverty-stricken Greeks queued in a central Athens park for free vegetables. Farmers from Crete handed out some 2,700 5-pound packages of produce, in cooperation with the capital’s municipal authorities.

Information for this article was contributed by Nicholas Paphitis, Elena Becatoros, Menelaos Hadjicostis and Dalton Bennett of The Associated Press; by Anthee Carassava and Henry Chu of the Los Angeles Times; and by Patrick Donahue of Bloomberg News.