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Greek PM calls referendum on new EU aid deal | Reuters

Greek Prime Minister George Papandreou called an unexpected referendum on Monday on the EU bailout deal for his debt-ridden country, a move that could necessitate a snap election if a public angry with swinging austerity measures rejects the deal.

Pressured by his own lawmakers to share the heavy political burden of belt-tightening with other parties, Papandreou said he needed wider political support for the fiscal measures and structural reforms required by international lenders.

“We trust citizens, we believe in their judgment, we believe in their decision,” he told ruling Socialist party deputies. “In a few weeks the (EU) agreement will be a new loan contract… we must spell out if we are accepting it or if we are rejecting it.”

Analysts said holding a referendum was a baffling decision, given that the latest survey showed a majority of Greeks taking a negative view of the bailout deal.

Opposition parties reacted angrily, accusing Papandreou of looking for a way out for his embattled party by dragging Greece, which has seen violent clashes between protesters and riot police, through a lengthy period of political instability.

via Greek PM calls referendum on new EU aid deal | Reuters.

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