?Greece's new Prime Minister Lucas Papademos has a history of financial experience, a trait that he'll need in upcoming years. With Greece in the middle of Europe's financial crisis, the way Papademos handles his country's finances will be closely examined by economists and market participants worldwide. If he fails to manage the Greek debt crisis in an organized fashion, it could spell trouble for other countries in the European Union. Papademos, however, has made it clear that abandoning the EU and the euro for the drachma is not an option.
The new Greek PM says that he is confident that the country can avoid the default potentially looming in March. He must successfully negotiate two different financial deals: one with the private sector lenders in his own country and the other with the International Monetary Fund and the EU. Private lenders must be convinced to accept only about half the money currently owed to them, while the IMF and EU must be satisfied by this deal, by national interest rates and by the country's four-year economic plan. Only then will they provide the 130 billion euros required to keep Greece afloat.
As of January 2012, an overwhelming majority of Greeks support Papademos's commitment to the EU and the Euro, though some market participants worry that this may reduce Greece's competiveness worldwide. About 73 percent of the Greek population support the new Prime Minister's election, with only about 20 percent stating that he was the wrong choice. A significant majority also regard his administration as a hopeful one, capable of getting Greece back on track economically.
For Greece's economy to revive itself, the country must have economic growth. Only time will tell if Papademos's plan to stick with the Euro and negotiate the country's finances with the EU will be the boost needed for that growth. However, the Greek people support this plan, increasing the chance that their new Prime Minister will succeed.
