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Cabinet reshuffle expected by Wednesday

With finance minister Yannis Stournaras expected to be next Bank of Greece governor, all eyes are on who his replacement will be

With a new cabinet, Premier Antonis Samaras seeks at once to persuade creditors that he will implement the bailout terms and to persuade voters that he will ease austerity

Replacing Finance Minister Yannis Stournaras (L) will reportedly be the key to the upcoming cabinet reshuffle Replacing Finance Minister Yannis Stournaras (L) will reportedly be the key to the upcoming cabinet reshuffle Prime Minister Antonis Samaras and Vice Premier Evangelos Venizelos are feverishly preparing their announced cabinet reshuffle, which they hope can give the government renewed momentum after the recent electoral defeat, with the key element being who will replace Finance Minister Yannis Stournaras, who is widely touted as the next governor of the Bank of Greece.

German Finance Minister Wolfgang Schaeuble's recent statement that Greece may need a new, more limited bailout package – estimates range from 10-20 billion euros - appears to have heightened government jitters, as it flies in the face of all the government's electoral promises that there will be no new memorandum or austerity measures.

Moreover, Schaeuble's insistence that the government must ply ahead with painful austerity measures seemed to cast doubt on the Samaras' government's feverish leaks that tax cuts are planned over the next year. The German finance minister went as far as to revive the spectre of a Greek euro exit, if Athens cannot comply with bailout terms.

"The Greek people must go through this reform process if the country wishes to stay in the euro. The Greeks decide for themselves for their future. But a monetary union can only work if all obey the common rules,” Schaeuble was quoted as saying in an interview with Germany's Focus magazine.

All this has made it all the more urgent for the government to proceed with a credible game changer, and a spate of leaks are indicating that the new cabinet may be announced as early as tomorrow, with the new government being sworn in on Thursday morning.

By all accounts Stournaras is the top candidate to replace George Provopoulos as governor of the Bank of Greece ,and though several names have been mentioned as possible successors at the finance ministry, including Public Order Minister Nikos Dendias, what is certain is that the new appointment must enjoy the full trust of Greece's creditors.

Samaras has reportedly even considered taking on the crucial finance portfolio himself, so as to signal to creditors that the unswerving implementation of the bailout programme will continue.

What is certain is that the new finance minister will have a key role in negotiating an expected deal to further restructure the Greek debt, and many consider Stournaras as the most qualified, by expertise and experience, to carry out the task.

Among those who are expected to be transferred or to leave the government are Agriculture Minister Athanasios Tsaftaris, Health Minister Adonis Georgiadis, Development Minister Kostis Hatzidakis, and labour minister Yannis Vroutsis.

Georgiadis, Vroutsis and Hatzidakis have all been among the most ardent enforcers of the bailout memorandum, and the Samaras-Venizelos government apparently wants to put behind it all the unpopular reforms with which the health and labour ministers have been identified, including huge health spending cutbacks and the complete deregulation of the labour market. Moreover, Georgiadis throughout his tenure went on the war path against protesting healthcare professionals, making the implementation of unpopular reforms even more difficult.

Other reports suggest the replacement of Justice Minister Charalambos Athanasiou, a retired judge. Samaras' former cabinet secretary, Takis Baltakos, had confided to Golden Dawn MP Elias Kasidiaris in a secretly recorded video that Athanasiou (along with Dendias) pushed the judiciary to prosecute Golden Dawn as a criminal organisation. The judicial tampering charge was never investigated in parliament.

Among the Pasok politicians reportedly slated for cabinet appointments by Venizelos are former health minister Andreas Loverdos, MP Paris Koukoulopoulos (a top Venizelos advisor) MP Odysseas Konstantinopoulos, former labour minister Yorgos Koutroumanis, and Sylvana Rapti, who failed to gain re-election to the European Parliament.

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Evangelos Venizelos
Antonis Samaras
Coalition government
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