Athens - Greek conservative Prime Minister Costas Karamanlis conceded defeat to the Socialists in parliamentary elections on Sunday. "I called George Papandreou to congratulate him on his victory. As does every Greek, I hope he succeeds in the great challenge to deal with the difficult circumstances," Karamanlis told a press conference.
Karamanlis, who will formally resign the office of the prime minister to Socialist leader George Papandreou on Monday, also handed in his resignation as head of the conservative New Democracy party.
"I had faith that my economic policies are necessary to take the country out of the economic crisis but voters did not select this route."
With nearly 50 per cent of ballots counted, the Socialist's won a comfortable majority with 43.6 per cent. The Conservative New Democracy Party came in second with 35 per cent.
According to the Interior Ministry, based on the partial results, PASOK would occupy 159 out of 300 seats in parliament, with New Democracy trailing with 95 seats.
The elections were seen as critical for implementing reforms needed in the Eurozone's second poorest member, which is on the brink of a recession.
The Socialists will face high unemployment, a budget deficit exceeding 6 per cent of GDP, illegal immigration and an insufficient social security system.
PASOK has proposed a 3-billion-euro stimulus package to tackle the economic crisis, proposing heavier taxing of the rich and helping the poor.
Outgoing Prime Minister Karamanlis had called for two years of tough reforms such as public sector wage freezes.
