Greek PM also knows he cannot solve a thing in the ME, there are the whole Greeks burning and assasinating each other who needs to be calmed down first. Papandreu is a good man but he is risking his already shaky government by visiting Israel. Most Greeks call him 'the American' or even 'the Hebrew' to show their distrust to him. And now visiting Israel is just making it worse. in the eyes of those Greeks.
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Details of secret talks for Israeli unity government revealed (Haaretz)
from the article: Greek PM to Haaretz: We could help mediate Middle East peace agreements