Greek Referendum: Greek Cabinet Helps Push Referendum Plan
Greek Prime Minister George Papandreou (AP Photo/Thanassis Stavrakis)Greece's cabinet has given unanimous backing to a controversial plan by PM George Papandreou to hold a referendum on a EU debt rescue package.
He told an emergency cabinet meeting a referendum, possibly in December, would offer "a clear mandate" for austerity measures demanded by eurozone partners.
Stock markets recorded big drops amid shocked reactions in eurozone capitals to the referendum announcement.
Mr Papandreou is due to meet European leaders in France on Wednesday.
In a cabinet meeting lasting late into Tuesday night, Mr Papandreou told ministers the government needed the consent of the Greek people.
In a statement released by his office, he said: "The referendum will be a clear mandate and a clear message in and outside Greece on our European course and participation in the euro."
Mr Papandreou also said a possible alternative of snap elections would risk Greece defaulting on its debt.
The Greek government faces a crucial confidence vote in parliament on Friday.
One MP from the governing Pasok party has resigned, cutting Mr Papandreou's parliamentary majority to two - and six other leading party members have called on him to resign.
Read further news HERE.
He told an emergency cabinet meeting a referendum, possibly in December, would offer "a clear mandate" for austerity measures demanded by eurozone partners.
Stock markets recorded big drops amid shocked reactions in eurozone capitals to the referendum announcement.
Mr Papandreou is due to meet European leaders in France on Wednesday.
In a cabinet meeting lasting late into Tuesday night, Mr Papandreou told ministers the government needed the consent of the Greek people.
In a statement released by his office, he said: "The referendum will be a clear mandate and a clear message in and outside Greece on our European course and participation in the euro."
Mr Papandreou also said a possible alternative of snap elections would risk Greece defaulting on its debt.
The Greek government faces a crucial confidence vote in parliament on Friday.
One MP from the governing Pasok party has resigned, cutting Mr Papandreou's parliamentary majority to two - and six other leading party members have called on him to resign.
Read further news HERE.