Former European Central Bank vice president Lucas Papademos was named as the new Prime Minister on Thursday to head the Greek coalition government, said the office of Greek president in a statement.

Newly appointed Prime Minister of Greece Lucas Papademos speaks to media outside the Presidential Palace in central Athens, Nov. 10, 2011. Lucas Papademos, a widely-respected economist and former European Central Bank (ECB) vice president, was appointed on Thursday as the prime minister in Greece's new coalition government. [Marios Lolos/Xinhua]

The announcement was made following a four-hour meeting between political parties leaders.

Outgoing Prime Minister George Papandreou, main opposition New Democracy (ND) party leader Antonis Samaras and Popular Orthodox Rally (LAOS) President George Karatzaferis agreed on the formation of a coalition government headed by Papademos.

"The new government has been assigned to implement the Oct. 26 eurozone summit agreement and the relevant economic policies. The government will be sworn in on Friday at 14:00 local time (1200 GMT),"said the statement.

The country is "at a critical crossroads", Papademos said. The formation of the unity government "will have a crucial importance for the welfare of the Greek people." 

"Greek economy still faces big challenges, despite efforts undertaken so far. The way ahead will be difficult, but I am convinced problems will be solved with unity," he said.

Papademos vowed that his country will not exit the euro zone. "I am convinced that our country's membership in the European common currency zone is a guarantee for monetary stability," he said.

Profile

Lucas Papademos, a widely-respected economist and former European Central Bank (ECB) vice president, was appointed on Thursday as the prime minister in Greece's new coalition government.

His major new task in the coming months is to implement a vital European Union (EU) aid deal to avert a Greek bankruptcy and lead the country to early general elections.

Born on Oct. 11, 1947 in Athens, Papademos holds a degree in Physics, a master's degree in electrical engineering and a PhD in economics from the Massachusetts Institute of Technology in the United States in the 1970s.

During his academic career, he once taught at Columbia University and Harvard University in the United States, University of Athens and Goethe University in Frankfurt.

Papademos, a member of the Academy of Athens, published many papers on macroeconomics, the function of international financial markets and monetary and economic policies in the EU.

He served as an economic advisor in the Federal Reserve Bank of Boston and the Bank of Greece in the 1980s.

In 1994, he was appointed as governor of the Bank of Greece, a post he held until 2002. During his term, Greece joined the eurozone, a step which fuelled criticism from some European counterparts after the outbreak of the Greek debt crisis over the "fixed" Greek statistics.

From 2002 until last year, he served as ECB vice president, standing next to Jean-Claude Trichet who recently stepped down from the top post, supporting strict fiscal discipline.

He has also been a member of several boards and committees in the EU institutions, such as the Financial Stability Board (FSB) and the EU Economic and Financial Committee (EFC).

In 2010, Papademos was appointed as a financial advisor to outgoing Greek Prime Minister George Papandreou.

In an article recently published in a Greek daily ahead of the Oct. 26 EU deal on further aid to Athens, he publicly expressed fear that a big "haircut" of the Greek state debt, far deeper than 21 percent loss for private holders of Greek bonds imposed under the July 21 eurozone summit agreement, "could pose risks for Greece and the eurozone, if regarded as non-voluntary."

The Oct. 26 EU deal eventually included a 50 percent "haircut" on Greek bonds which was not regarded as a credit event.

(Xinhua News Agency contributed to the story)

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