Tuesday, May 15, 2012

Greece to hold new elections after stalemate

Athens, Greece (CNN) -- Greece will hold new elections in response to a political stalemate that left the debt-racked country unable to form a government, the office of President Karolos Papoulias said Tuesday.

The announcement comes as the Greek debt crisis threatens the stability of the European Union's single currency. Papoulias has called for all parties to meet with him Wednesday to set up a caretaker government that will conduct the new vote, his office said.

Greece has been in a political deadlock since elections nine days ago left no party with a majority. The leaders of three different parties have tried to cobble together a workable coalition, but all have failed.

That leaves Greece facing another vote, probably in mid-June. Meanwhile, the rest of Europe has watched with a nervous eye, fearing Greece could fail to make debt payments as early as next month. And that could force the country out of the euro, the currency used by 17 European Union countries. Read More