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
Belgium Flails as PM Quits in Bailout Scandal
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)

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.
(More Yves Leterme stories.)

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