Prime Minister George Papandreou won a confidence vote in Parliament early Saturday, paving the way for him to begin talks to form a coalition government, which may not include New Democracy as PASOK might seek to form alliances with some of the smaller parties.

Papandreou, who received the support of 153 out of 300 MPs, indicated in his speech that he would be willing to stand aside but did not give a firm commitment to do so. Nor did he suggest who might succeed him, although Finance Minister Evangelos Venizelos appears the most likely candidate.

”I ask for the vote of confidence to avert the instability that would be caused if the country is dragged into elections,” said Papandreou in his address. ”Now is the time for cooperation with good intentions and a feeling of national responsibility.”

A potential deal for a transition administration involving New Democracy appears to have foundered on who would serve in the new government and for how long it would be in power before elections would be called. But the main sticking point was ND leader Antonis Samaras’s insistence that Papandreou step down immediately and not oversee the coalition talks.

“Mr Papandreou rejected our proposal,” said Samaras, who had earlier this week declared he would vote for the new eurozone bailout package after the prime minister dropped his bid to hold a referendum on the matter. “The only solution is elections.”

However, these snap elections will not be held if PASOK can reach a deal with the right-wing nationalist Popular Orthodox Rally (LAOS), the centrist Democratic Alliance and possibly the moderate leftist Democratic Left. There were suggestions early today that Democratic Alliance leader Dora Bakoyannis expressed doubts about taking part in such an interim administration.

Closing the parliamentary debate, Finance Minister Evangelos Venizelos said that the emergency government would only serve until the end of February, when elections would be called. He said the new administration would have to ensure the disbursement of the next loan installment from the EU and IMF.

Greece needs the 8 billion euros within the next few weeks to prevent it defaulting. The next task for the caretaker government would be to agree the terms of the new bailout, which will provide 130 billion euros in loans and a reduction of 100 billion euros from its debt load through a 50 percent haircut for private bondholders.

Earlier in the day, the pressure was building within the ranks of the ruling Socialist party for Papandreou to step aside and initiate the process of setting up a transitional unity government. Several MPs and ministers issued strong statements calling for the premier to clarify his stance.

In a written statement, Health Minister Andreas Loverdos said that he would support the government in a crucial confidence vote but that it must be followed by the prime minister taking concrete steps to form a national unity government. Loverdos said that unless Papandreou starts working toward the creation of a unity government immediately after the confidence vote, “I will have no involvement in the political procedures that follow.”

Education Minister Anna Diamantopoulou issued a similar appeal to Papandreou on Thursday night.

 Leaders relieved referendum dropped, awaiting next steps

Politicians around the world focused their attention on Friday on political developments in Greece, underlining that whichever government runs the country over the next few months will do so under great international pressure.

Speaking after the G-20 meeting in Cannes, US President Barack Obama questioned Prime Minister George Papandreou’s proposal to hold a referendum on the country’s eurozone debt deal and applauded New Democracy leader Antonis Samaras for backing last week’s Brussels agreement.

“We came to Cannes to discuss with our European friends how they will move forward and build upon the plan they agreed to last week to resolve this crisis,” he said.

Obama said the “actions of Papandreou and the referendum issue got a lot of people nervous.” He added that the plan European leaders presented last week is “still the best recipe.” He commended Samaras for saying he would support the bailout after the referendum proposal was dropped.

Dutch Prime Minister Mark Rutte welcomed Papandreou’s decision to withdraw the referendum but warned that the eurozone might lose patience with Athens. “It was a bizarre proposal,” Rutte said. “We think it’s of great importance to the eurozone that we prevent Greece from going bankrupt. But in the end, the euro is more important than Greece’s membership of the eurozone.”

There was greater support for Papandreou and Greece from former German Chancellor Gerhard Schroeder. He said the “main mistake” made over Greece in the debt crisis was that not enough was done to help the country get back on its feet.

“It’s no surprise Papandreou hardly had a chance to push through what was being demanded from him,” he said. “The conservatives across Europe did very little to convince the Greek conservative opposition to stop acting irresponsibly.”