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My Profile Top News Reuters top ten news stories delivered to your inbox each day. Subscribe You are here: Home > News > International > Article Home Business & Finance News U.S. Politics International Technology Entertainment Sports Lifestyle Oddly Enough Health Science Special Coverage Video Pictures Your View The Great Debate Blogs Weather Reader Feedback Do More With Reuters RSS Widgets Mobile Podcasts Newsletters Your View Make Reuters My Homepage Partner Services CareerBuilder Affiliate Network Professional Products Support (Customer Zone) Reuters Media Financial Products About Thomson Reuters Greek Socialists work on cabinet with big majority Mon Oct 5, 2009 10:56am EDT Email | Print | Share | Reprints | Single Page [-] Text [+] By Ingrid Melander ATHENS (Reuters) - Socialist PASOK leader George Papandreou started work putting together a cabinet on Monday after winning a decisive mandate to battle corruption and lead Greece out of an worsening economic downturn. Appointments to the key finance, foreign and economy ministry posts were expected as early as Tuesday, and Greek media were reporting Papandreou might take one of the first two jobs for himself to emphasize how seriously he took the crisis. With 99 percent of Sunday's vote counted, results showed PASOK had thrashed the conservative New Democracy party, which suffered the worst showing in its history. PASOK won a comfortable majority of 160 seats in the 300-member parliament. It was a personal victory for U.S.-born Papandreou, 57, who was handpicked in 2004 to lead the party his father Andreas founded, partly on the strength of his name, only to twice lose to another scion of a political family, Costas Karamanlis. "What is impressive in this parliamentary election is that George Papandreou crushed his opponent with the largest percentage difference in the last 35 years," said Anthony Livanios, political analyst at polling agency Alpha Metrics. Karamanlis gave up his role as party chief when he conceded the election on Sunday night. Even more difficult challenges now lie ahead. Greece's budget deficit tops 6 percent of GDP -- well above the EU limit of 3 percent -- unemployment is rising and the public is clamoring for solutions to urgent crises in endemic corruption, education, social security and immigration. "We must consolidate all our strength, we have a heavy responsibility," Papandreou said before receiving a formal mandate from the president to form a government on Monday. A first test will come with the budget, a first draft of which needs to go to parliament by November so that it can be approved before the year-end break in mid-December. "The budget will be a good test to see where the government is going, whether they are serious about improving the competitiveness of the economy," said Diego Iscaro, an analyst at IHS Global Insight. THREE-YEAR PLAN The budget will feed into a three-year plan that Papandreou wants to submit to Brussels to convince EU partners he is determined to tidy up Greece's fiscal mess. In a nod to that effort, European Commission President Jose Manuel Barroso wrote to Papandreou on Monday. "Europe today faces challenging times: we need to deploy our strengths and work together if Europe is to emerge stronger from the current financial and economic crisis and build a prosperous, secure and sustainable future for all Europeans," he said in a congratulatory message. PASOK has promised a 3 billion euro ($4.36 billion) stimulus package on a platform of taxing the rich and helping the poor and will need to convince markets, the EU and voters that it can do so without further worsening Greece's ballooning deficits. Continued... View article on single page Share: Del.icio.us Digg Mixx Yahoo! 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