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Samaras Sworn In As New Greek Prime Minister

(c) Sky News 2012

After seven weeks of political uncertainty, a conservative-led government has been agreed in Greece, the leader of the country's socialist party, Pasok, has said.

Evangelos Venizelos said they will form a team to "renegotiate" the EU/IMF (Berlin: MXG1.BE - news) bailout saving the country from bankruptcy.

Mr Venizelos, whose Pasok party is entering an alliance with the larger conservative New Democracy and the Democratic Left party, said cabinet posts would be decided by Wednesday evening.

He said the key issue would be to form a team to renegotiate the 130bn euro bailout.

New Democracy leader Antonis Samaras is meeting the Greek President Karolos Papoulias to tell him he has successfully formed a coalition government.

There will then be a formal swearing in process before the three leaders meet their acting finance minister Giorgos Zanias.

The finance minister is due to join other ministers from the eurozone in Luxembourg on Thursday.

The development is expected to calm fears that a protracted political crisis in debt-struck Greece could have led to the country being forced out of the joint European currency. 

Such an event could have dragged down other financially troubled eurozone nations and hammered the global economy.

Pasok came third in Sunday's election, which was won by New Democracy party. No party won enough votes to form a government on its own, leading to three days of coalition talks.

The runner-up in Sunday's ballot, the anti-bailout radical left Syriza party, has refused to join any government that will implement the terms of Greece's international bailout loans.

More to follow...