- Socialist and center-right leaders in Greece hold talks to form a government
- New elections must be called if a new government isn't formed by Thursday
- A poll find leftist Syriza party growing in popularity
Athens, Greece (CNN) -- Two top Greek politicians huddled Friday in talks to form a new government in their economically embattled land.
Socialist PASOK leader Evangelos Venizelos met with Antonis Samaras, head of the center-right New Democracy party. Samaras said it will be tough to form a "viable government," but he said, "There is still hope."
Venizelos is the third Greek politician since Sunday tasked with forming a new government. Samaras and another potential coalition partner -- Alexis Tsipras of the leftist Syriza party -- have tried and failed to organize a government already. If no one can pull together a coalition, and no national unity government can be formed by next Thursday, Greece must call new elections.
The political wrangling comes after Sunday's national elections.
Greece has been forced to impose punishing austerity measures to get international loans that have kept it from defaulting on debts. But this week's election results were widely seen as a message to politicians to back away from the harsh economic austerity measures, policies of cutting spending and raising taxes to reduce public debts.
The stakes are potentially huge for the rest of the eurozone, the group of 17 European countries that use a common currency.
There is concern that the lack of leadership could jeopardize Greece's bailout agreement with the European Union and International Monetary Fund. That could lead to a disorderly default by Greece, which would force the nation out of the eurozone.
A default by Greece also could drag down other troubled governments such as Spain and Portugal despite beefed up resources in the crisis. The eurozone economy is fragile, and any financial shock could plunge the region into a deep recession, a development that would ripple across the globe.
German Chancellor Angela Merkel is the most outspoken supporter of fiscal discipline in the eurozone. Other leaders have been ousted by voters frustrated with austerity. France's President-elect, François Hollande, campaigned against austerity and has promised to push through measures to boost economic growth.
In the Greek election, voters backed parties on the far left and right, withholding support from PASOK and New Democracy, the more moderate parties that made up the coalition that enacted austerity measures. Seven parties won seats in parliament in Sunday's election, but no party captured more than 19% of the vote.
Venizelos, who has three days to cobble together a deal, said Sunday's fragmented results show voters don't trust "any party on its own." But he has said he wants Greece to stay in the eurozone.
He has held meetings with the leader of the Democratic Left party, Fotis Kouvelis, in what he called a "first step" toward assembling a coalition of pro-European parties.
Samaras said his New Democracy party would be willing to participate in a national unity government "provided it ensures Greece's stay in the euro" and a revision of the bailout agreements with the country's foreign lenders.
Speaking to other members of parliament, Samaras accused the leftist Syriza party, which placed second in the elections, of "populism" and a desire to take the country to new elections. Samaras said any new elections would mark a battle "between the pro-European parties and the anti-European left."
Venizelos was to meet later Friday with Tsipras.
Tsipras said Greece is no longer bound by austerity promises made in return for rescue loans. Tsipras has also demanded an examination of Greece's massive debt and a moratorium on part of its repayment.
An opinion poll Thursday shows that Syriza would come in first if fresh elections were held, with nearly 28% of the vote, much higher than the 16.8% that landed the party into second place during this week's elections.
PASOK and New Democracy, the two parties that have been dominating political life in Greece for decades, have seen their popularity plummet as a result of the two bailouts and the austerity measures dictated in the programs. The poll shows that if elections were held New Democracy would slightly increase its position to 20.3%, while Pasok's popularity would suffer an even steeper decline to 12.6%.
Last year, Greece's debt threatened to force it to drop Europe's common currency, the euro, prompting the European Central Bank and other lenders to swoop in with emergency funding. In exchange, they demanded that the government slash spending.
The resulting measures have led to tax increases and cuts in jobs, wages, pensions and benefits -- and significant public outcry.
The national unemployment rate for January, the latest month for which figures are available, was nearly 22%, prompting widespread protests and leading some young people to leave the country in search of work.
Youth unemployment is even higher than the national average of one in five out of work.
For two years, the country's massive amount of debt has threatened the stability of the eurozone.
Greece pushed through a huge debt swap in March to save it from disorderly default and clear the way for it to receive a second bailout from the European Union, the European Central Bank and the International Monetary Fund, worth €130 billion ($171.5 billion).
The debt restructuring deal gave some breathing space to the eurozone bloc, where fears that Greece might collapse had increased pressure on other debt-laden nations such as Spain and Italy.
