Greece will hold a new election after politicians failed to form a government, nine days following an inconclusive vote, prolonging a political crisis that pushes it closer to bankruptcy and exit from the euro.
After a third day of failed talks with political leaders on Tuesday, a spokesman for President Karolos Papoulias said the process of seeking a compromise had been declared a failure and a new vote must be held.
He did not immediately give the date for the new vote, but elections rules suggest it will be in mid-June. A caretaker government would be formed on Wednesday, the spokesman said.
"For God's sake, let's move towards something better and not something worse," Evangelos Venizelos, Socialist party leader, said after the meeting.
"Our motherland can find its way, we will fight for it to find its way."
Fotis Kouvelis, leader of the Democratic Left (DIMAR), said his party "did everything possible, I did everything I could for the six per cent of the population that honoured me with its vote ... Unfortunately, our proposal for a unity government was rejected."
Leaving the talks, New Democracy party leader, Antonis Samaras, said his party went so far as to accept a government without any New Democracy representatives, so far as the nations remained in the euro.
No 'middle ground'
Al Jazeera's Paul Brennan, reporting from Athens, said that throughout the discussions "there was really no middle ground" among the parties.
He said that compromise will be necessary if Greece wants to avoid "a disorderly exit from the euro".
The inability of Greek political parties to reach a consensus and form a government after days of talks has led to frustration among the people.
Greece has been without a government since an inconclusive May 6 election left parliament split between supporters and opponents of a 130bn euro bailout package reviled by Greeks for imposing deep wage, pension and spending cuts.
Polls show the radical Left SYRIZA party, which rejects the bailout and placed second in last week's vote, is now on course to win, a result that would give it an automatic bonus of 50 seats in the 300-seat parliament.
"We resisted in every way," Alexis Tsipras, SYRIZA's leader, said. "We made the decision to not betray your hopes and your expectations."
His party fought the election on an anti-austerity platform and blocked any deal with pro-bailout mainstream parties.
"Now it's time to complete it: We will consign in the dustbin of history all the spent forces of the past," Tsipras said.
Danger level
The turmoil in Greece sent shockwaves around other troubled members of the 17-nation European single currency area on Tuesday.
The euro slipped below $1.28, world stocks slid and Spanish and Italian bond yields rose above the danger level of six per cent as investors ran for shelter in safe haven German Bunds.
Eurozone finance ministers have dismissed talk of Greece leaving the single currency area as "propaganda and nonsense".
However, with hostility to EU/IMF-imposed austerity rising in Greece, speculation about a possible state bankruptcy and euro exit is affecting financial markets.
Christine Lagarde, IMF chief, said it was important to be technically prepared for the possibility of Greece leaving the eurozone, warning that such a move would be "quite messy" with risks to growth, trade and financial markets.
Jyrki Katainen, Finnish prime minister, openly discussed the prospect, telling broadcaster MTV3.
