Greek Prime Minister George Papandreou is backing off plans to hold a controversial referendum on an international bailout for his country, he told his Cabinet on Thursday, saying there was no need for it given opposition support for the tough austerity measures that accompany it.
Papandreou caused shock this week when he announced the referendum that would have allowed the Greek people to reject the hard-won eurozone debt deal that seemingly put the bricks in place for the economic salvation of the continent.
French President Nicolas Sarkozy said Wednesday that Greece would have to leave the group of 17 nations that use the European single currency if the country and its people failed to accept austerity and other measures that formed part of the bailout plan.
Thursday's developments came as leaders of the world's financial powerhouses met in Cannes, France, for the Group of 20 economic summit.
The G-20 meeting was scheduled to address adding confi dence and stability to the global economy, but the Greek crisis has dominated so far.
U.S. President Barack Obama, in France for the summit, said: "The most important task for us is to resolve the financial crisis here in Europe."
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