EUROPE: What To Expect In The Next 24 Hours

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Photo: Xuan Che on Flickr

This is shaping up to be a huge week for Europe.Greek PM George Papandreou’s big announcement to hold a referendum on the terms of Greece’s most recent bailout hit the markets with a curveball. And the craziness doesn’t look like it will stop anytime soon.

Here are the big issues we’ll be watching in Greece and Europe for the next 24 hours:

– Acceptance or disapproval of the referendum in the legislature

Members of Papandreou’s PASOK party seem increasingly unhappy with the idea of a referendum. Six senior party officials advocated Papandreou’s resignation in a public letter. Further, one PASOK MP has already defected — with rumours of more to follow — slimming PASOK’s majority to two.

On the other hand, it looks like some politicians are realising the potentially devastating consequences of a failed government. Chatter abounds about independent politicians teaming up with PASOK to pass the confidence vote.

– German Chancellor Angela Merkel, French President Nicolas Sarkozy will hold an emergency meeting with Greek leadership in Cannes tomorrow at 1 PM EST.

It seems possible that other European leaders could influence this new referendum proposal and/or push the coalition to the edge.

– Escalating tensions between the military and the Greek government

This could be the start of something really scary. Today, Greek defence Minister Panos Beglitis staged a major shakeup of military leadership, suggesting that political instability is already considerable. Chatter that Beglitis was trying to prevent a military coup after officer protests last month paint an ominous picture for Greece’s fate.

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