The leader of Greece's main opposition party repeated demands on Saturday that Prime Minister George Papandreou resign and call immediate elections, as talks on setting up a temporary coalition government continued.

Antonis Samaras, leader of the conservative New Democracy party, indicated he was less interested in Papandreou's push for a short-term unity government and more on elections he said would stabilize the debt-shackled country as it struggles to secure more funds.

Papandreou has said he would step aside if necessary to help his Socialist party hammer out a four-month coalition. A coalition is vital to securing an additional €130 billion ($179 billion) in loans and would demonstrate the country's commitment to remaining in the eurozone, he said.

"We have not asked for any place in his government. All we want is for Mr. Papandreou to resign, because he has become dangerous for the country," Samaras said in a televised address. "We insisted on immediate elections."

Samaras's remarks come after the prime minister held talks with Greek President Karolos Papoulias earlier in the day regarding hopes that a unity government could implement the aid package, agreed to by European leaders late last month.

The two leaders met a day after the prime minister narrowly won a confidence vote in the Socialist-led parliament by a vote of 153-145. Samaras plans to meet with President Papoulias on Sunday.

Referendum plan nixed

Papandreou has warned snap elections would be catastrophic for the country and would scuttle the new European debt deal.

"My aim is to immediately create a government of co-operation," Papandreou told the president in the presence of reporters before the two leaders began their talks. "A lack of consensus would worry our European partners about our country's membership of the euro zone."

The confidence vote came days after Papandreou's ultimately scrapped plan to put the debt deal to a referendum sparked an open rebellion in the governing Socialist party, with deputies openly calling for him to step down.

Samaras said Papandreou had "nearly destroyed Europe and the euro" with his call for a referendum. Debt-crippled Greece is surviving on a €110 billion ($150 billion) rescue-loan program from eurozone partners and the International Monetary Fund.

The IMF is currently finalizing the second mammoth deal, with banks agreeing to cancel 50 per cent of their holdings of Greek debt.

Socialist party officials insisted any new government would need until late February to secure the second deal, warning that a snap poll could scuttle it.

They insisted Saturday that Papandreou's offer to step aside was sincere, and called on  Samaras to urgently reconsider his party's position.

"If Mr. Samaras were willing to back a new government, the prime minister would resign today," Yiannis Magriotis, a deputy public works minister, told private Skai television.

CBC freelance contributor Dominic Valitis reported from London that Greek Finance Minister Evangelos Venizelos would be the likely replacement for Papandreou.

"A coalition government is not ideal. It's already being referred to as the 'least worst option,' " Valitis said. "Political turmoil is far from over in Greece."

With files from The Associated Press