Greek parties' last-ditch coalition talks collapse

Greece's socialist leader and former finance minister says efforts to form a coalition government have failed.

Evangelos Venizelos, who was the last of three party leaders to try to reach an agreement, said Friday he would hand the mandate back to the country's president Saturday.

He made the comments after meeting with Radical Left Coalition leader Alexis Tsipras, whose anti-austerity party came second in Sunday's election. Tsipras said he would not join any government that intended to continue implementing the terms of Greece's international bailout agreement, which he says is too harsh.

Earlier Friday, the head of the small left-wing Democratic Left party, Fotis Kouvelis, said he would not join forces with the conservatives and socialists to form a government.

Kouvelis's party won 19 seats in Sunday's election, but he said he could not join any coalition that does not include Tsipras's runner-up Radical Left party.

The heads of the winning conservatives and third-placed socialists have warned that Tspiras's demands would force Greece out of the euro which all parties say they do not want.

New elections possible next month

If no deal can be found, Greece will have to hold new elections next month.

Friday's meeting between Venizelos and election winner Antonis Samaras, the leader of Greece's conservative party, was seen as a last-ditch effort to form a coalition government in the crisis-struck country.

"We are fighting for a government to exist and there is still hope this can happen," Samaras told his deputies in a speech after his meeting with the former finance minister.

Venizelos's Pasok party was hammered by furious voters, who blame it for its handling of the financial crisis. Its third place was its worst electoral showing in nearly 40 years, giving it just 13.18 per cent and 41 seats in the 300-member parliament.

Even if Samaras and Venizelos agreed, they would not hold enough seats in parliament combined to form a government unless another party joins them.

Greece has been dependent since May 2010 on billions of euros of rescue loans from other European Union countries that use the euro and the International Monetary Fund.

In return for the funds that are keeping Greece functioning, Athens has imposed repeated rounds of spending cuts and tax hikes, leaving the country mired in a fifth year of recession, while the jobless rate increases by hundreds of people each day.