Athens - Greece's newly-elected Socialist Prime Minister, George Papandreou, will personally handle foreign affairs in the new government and named foreign-trained ecnomists to the country's top ministries Tuesday in an effort to pull the country from the brink of recession. Following a landslide victory in parliamentary elections on Sunday against the conservatives, the US-born and -educated Socialist leader has made reforming the faltering economy his government's top priority.
He appointed London-trained economist Louka Katseli to head the Economy, Competitivenes and Shipping ministry and Socialist party spokesperson George Papacontantinou in the Finance Ministry.
Faced with high youth unemployment, low budget revenues, a faltering economy and a deficit surpassing 6 per cent of GDP, both Katseli and Papacontantinou will be responsible quickly to turn the economy of the eurozone's second-poorest member around.
Katseli, 57, a Princeton graduate, has served as economic advisor to Papandreou's father, Andreas between 1993 and 1996. She has taught economics at Yale and worked for the OECD.
Her finance ministry counterpart, Papaconstantinou, 47, studied at the London School of Economics and New York University. He had served as Papandreou's advisor from 2004-2007 and party spokesperson after that.
Panagiotis Patrakis, an economist and professor at the University of Athens, said improving the state of public finances is the primary challenge of the next government, as is taking all necessary measures to inflate economic activity.
The new prime minister also created Greece's first ever Environment, Energy and Climate Change Ministry, with close aide Tina Birbili in charge.
Papandreou's surname may be reminiscent of old times, being the son and grandson of two former prime ministers. But in the five years he has headed the main opposition he has fought hard for the radical reform of the party.
With many Greeks sceptical of a party whose old guard had been tainted by allegations of scandals and complacency in the past, Papandreou has pledged to bring transparency into Greek politics.
Credited with boosting ties with neighbouring Turkey when he was foreign minister in the 1990s, Papandreou opted to take over the foreign ministry portfolio himself in the new government.
Papandreou, one of the architects of Turkish-Greek rapprochement, still believes on backing Turkey's EU entry on the condition that it brings long-lasting peace in the area and helps reunited the divided island of Cyprus.
The Socialist PASOK party has promised a new approach to the economic crisis with a 3-billion-euro stimulus package, and heavier taxing of the rich and helping the poor.
In contrast, former conservative leader Costas Karamanlis had said his government would proceed with public-sector salary and pension freezes if he was re-elected.
Poor state revenues forced the previous conservative government to borrow 52 billion euros so far this year in order to finance a widening budget deficit, expected to exceed 8 per cent of gross domestic product.
During his election campaign, Papandreou announced a 100-day plan to bring five draft bills to parliament aimed at helping small businesses. He called for above-inflation pay rises and a reformed tax system that will put a heavier burden on the rich.
