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Belgium Flails as PM Quits in Bailout Scandal

Replacing him tricky as deeply divided nation slips into recession

By Jason Farago,  Newser Staff

Posted Dec 23, 2008 7:30 AM CST
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(Newser) – Belgium is seeking to emerge from its third political crisis in the space of a year after PM Yves Leterme stepped down yesterday in a banking scandal. His government was accused of trying to influence a court case involving the bailout of Fortis, one of the first big banks to approach collapse in the financial crisis. But finding a new leader for the deeply divided binational kingdom will be difficult, reports the Wall Street Journal.

Leterme won election in June 2007 but needed 9 months to cobble together a coalition, and his weak leadership stoked fears that the country could split in two. Speculation has grown that the king will appoint Jean-Luc Dehaene, PM from 1992 to 1999, to serve again until new elections can be held next year. The political crisis threatens to blunt Belgium's response to the financial crisis; economists say the country will slide into recession this quarter.

Belgian Prime Minister Yves Leterme, left, is seen as he arrives at the royal palace in Brussels to tender the resignation of the government over the handling of the Fortis bank bailout.
Belgian Prime Minister Yves Leterme, left, is seen as he arrives at the royal palace in Brussels to tender the resignation of the government over the handling of the Fortis bank bailout.   (AP Photo / Geert Vanden Wijngaert)
A man leaves the Fortis Holding headquarters in Brussels, Monday Dec. 15, 2008.
A man leaves the Fortis Holding headquarters in Brussels, Monday Dec. 15, 2008.   (AP Photo/Geert Vanden Wijngaert)
People walk past the sign of a branch of the Fortis bank in Brussels, Thursday Dec. 18, 2008.
People walk past the sign of a branch of the Fortis bank in Brussels, Thursday Dec. 18, 2008.   (AP Photo/Thierry Charlier)
Yves Leterme talks to the media during a press conference at his office in Brussels, Tuesday, Nov. 18 , 2008, following a ruling of the Commercial Court about the crisis concerning the Fortis bank.
Yves Leterme talks to the media during a press conference at his office in Brussels, Tuesday, Nov. 18 , 2008, following a ruling of the Commercial Court about the crisis concerning the Fortis bank.   ( AP Photo / Thierry Charlier.)
Belgium's Prime Minister Yves Leterme offered to resign his government on Friday, Dec. 19, 2008, over the handling of the botched Fortis bank bailout. The king accepted his resignation yesterday.
Belgium's Prime Minister Yves Leterme offered to resign his government on Friday, Dec. 19, 2008, over the handling of the botched Fortis bank bailout. The king accepted his resignation yesterday.   (AP Photo/Hermann J. Knippertz, File)
Belgium's Prime Minister Yves Leterme offered to resign his government on Friday, Dec. 19, 2008, over the handling of the botched Fortis bank bailout. The king accepted his resignation yesterday.
Belgium's Prime Minister Yves Leterme offered to resign his government on Friday, Dec. 19, 2008, over the handling of the botched Fortis bank bailout. The king accepted his resignation yesterday.   (AP Photo/Geert Vanden Wijngaert, File)
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King appoints 'explorer' to find a new leader
Bloomberg

What the resignation means for the Fortis deal
International Herald Tribune

 
Belgium • crisis • Yves Leterme • King Albert • Fortis NV • Fortis

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