A new Greek interim government will be announced this afternoon, a government official said, after critical power-sharing talks between the country’s two parties dragged into a third day despite intense European pressure.

Negotiations between the Prime Minister, Mr George Papandreou, and the Opposition leader, Mr Antonis Samaras, began on Monday to resolve a political crisis that has threatened to leave Greece without its vital bailout loans and raised the possibility of the country leaving the euro.

The two reached a historic weekend agreement to forge an interim government that will shepherd the country’s new a €130 billion ($179 billion) European rescue package through Parliament and end an intense political crisis that threatened Greece’s solvency and membership of the euro.

Mr Papandreou has agreed to step aside once a deal is reached. His surprise announcement last week that he would put the new debt deal to a referendum sparked the latest political crisis, leading to an angry backlash from European leaders who had hammered out the agreement barely a week before, and a revolt from Mr Papandreou’s own Socialist lawmakers.

He withdrew the plan after Mr Samaras indicated that he would back the debt deal.

As coalition talks spilled into a third day without any public announcement of who will take over as interim premier, a government official said Mr Papandreou would visit the country’s president by around mid-day.

The official said the makeup of the new Cabinet would be announced in the afternoon following a meeting between party leaders. According to protocol, government changes must be announced to the president, who holds a largely ceremonial post.

The official spoke on condition of anonymity because he was not authorised to speak on the record.

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