Greece PM warns of euro exit as coalition talks begin

Greece's Prime Minister George Papandreou warned Saturday that his debt-wracked country could still be forced out of the euro, as he said talks to form an emergency government would begin very soon.
Fresh from winning a nail-biting confidence vote, Papandreou emerged from an hour-long meeting with President Carolos Papoulias to tell a scrum of reporters that contacts would begin "very soon" to forge a government of "broad consensus".
"I came today to discuss my intention to contribute in a decisive fashion to a government of broad consensus," he said.
The aim of this unity government would be to push through the EU bailout plan agreed last week in Brussels designed to keep the near-bankrupt country afloat, he added.
"The application of this deal is the precondition for us staying in the euro. It's as important as that," he said.
However, it remained unclear whether he would be able to secure the support of the opposition conservatives, whose leader Antonis Samaras steadfastly stuck to his demand for early elections, which Papandreou said would be catastrophic.
Under intense pressure from European partners and facing a rebellion within his own socialist ranks, Papandreou indicated in a half-hour address to MPs in the early hours of Saturday that he would step aside.
"I am not interested in a chair, the last thing I am interested in is whether I am re-elected," said Papandreou, who swept to a landslide national election victory in 2009.
But Samaras defiantly held out for snap elections, raising the spectre of renewed political deadlock in the country, which could delay the payment of much-needed aid and intensify the eurozone debt crisis.
"The mask has fallen. Papandreou has rejected our proposals and he must take responsibility for that," said Samaras, who heads the opposition New Democracy party.
"Elections are now the only answer."
The parliamentary head of Papandreou's socialist Pasok party, Christos Protopapas, warned that the talks could still end in failure.
"I would like to believe that there is still room for manoeuvre, but the crisis is getting worse," Protopapas told Net public television.
"What the Greeks want -- a team led by a third person, neither Papandreou nor Samaras -- is in the process of being lost. It's dangerous," he said.
Earlier Saturday, Papandreou had pulled off a stunning political victory by winning a cliffhanger of a confidence motion by a margin of eight votes amid high tension.
The result had hung in the balance amid unbearable tension as each MP voted in favour or against the motion, with the "yes" and "no" camp neck-and-neck right to the end.
Adding to the pressure, several thousand communists staged noisy protests in front of the floodlit building as the debate took place.
There was bewilderment on the streets of Athens and renewed calls for the politicians to sort out Greece's worst economic crisis in decades.
"The people are suffering at the moment and they (politicians) are not budging," said Marianna, a shopkeeper.
"A unity government with whom? With the same people? We will have the same results," she said gloomily.