New Greek PM sworn in, cabinet to be appointed Tuesday

Greek socialist leader George Papandreou was sworn in as prime minister on Tuesday and was expected to announce within hours a leaner cabinet focused on taking Greece out of an economic crisis.

With his hand on the Bible, the PASOK leader was sworn in by Greece’s archbishop Ieronymos in a solemn ceremony at the presidential mansion.

Papandreou was expected to appoint a mix of senior members of his party and fresh names with international experience in a tight team, splitting the finance and economy jobs but joining the environment and energy portfolios into one.

The move to split the ministry of national economy and finance was meant to signal that fighting the economic crisis was the government’s top priority, analysts said.

“It remains to be seen if it is going to be an effective tool,” said Costas Panagopoulos, manager of pollster ALCO.

PASOK shadow economy minister Louka Katseli and the party’s spokesman George Papaconstantinou were most likely to get the economy or finance posts, Greek media said.

Papaconstantinou, 47, studied economics at NYU and the London School of Economics and worked at the OECD in France.

An EU lawmaker since 2007, he was adviser to former Prime Minister Costas Simitis in 1998-2000 before becoming Papandreou’s economic adviser in 2004.

Katseli, 57, was special economic adviser to Papandreou’s father Andreas when he was prime minister between 1993 and 1996. She studied economics at Princeton and was an associate professor of economics at Yale.

After years of robust growth, Greece’s economy has slowed sharply and is on the verge of recession.

PASOK won Sunday’s snap election with a comfortable majority, gaining 160 seats out of 300 in parliament which should make it easier for the new government to implement its promised 3 billion euro ($4.39 billion) stimulus package.

Fitch Ratings has said that Greece cannot afford the stimulus package because it is too indebted.

The country has the euro zone’s second largest debt as a percentage of GDP and analysts say it urgently needs structural reforms, including of the pension and tax system.