(CNN) -- Greece is in a state of political turmoil sparked by Prime Minister George Papandreou's call earlier this week for a referendum on the latest bailout package from Europe.





A confidence vote in his government is scheduled for Friday night -- in the meantime, uncertainty rules.





The crisis is unfolding as leaders of the G-20 group of nations meet in Cannes, France, for economic talks, amid fears that a debt default in Greece could send shock waves through the global economy.





So what could come next for Greece? Analysts see several potential scenarios.





The vote of confidence in Papandreou's government is expected to go ahead as planned, despite discussions Thursday on the formation of an interim coalition or national unity government.





If he wins the confidence vote, he could claim a fresh mandate for his ruling Socialist PASOK party -- although even some within his party think its days in charge are numbered.





Senior PASOK lawmaker Tilemachos Chytiris told Greek state TV channel ERT that ideally Papandreou would win the vote, but a national unity government would then be formed.





If he loses the vote, the government would go into caretaker status until early elections can be held, said Heather Conley, senior fellow and director of the Europe Program at the Center for Strategic and International Studies and a former U.S. deputy assistant secretary of state.





"What's a foregone conclusion is that Papandreou would have to step down and allow a technocratic government that would receive the full support of parliament to be that caretaker," she said.





In another scenario, the leader of the main opposition New Democracy party said Thursday that his party could enter a coalition government with the PASOK party, as an interim stage leading to new elections.





Papandreou's office said he is prepared to enter a national unity government with the opposition, but rejected the condition that early elections be held.





Opposition leader Antonis Samaras later Thursday said Papandreou should step down and called for snap elections within six weeks.





Under Greek law, a vote cannot be held until at least 30 days after elections are called, meaning that the Greek people would go to the polls in early December at the soonest.





In that case, it would be likely that the conservatives would win the most votes but would not have a parliamentary majority, forcing them to form a coalition government, said Kostas Gemenis, an assistant professor of politics at the University of Twente in the Netherlands.





That coalition could include far-right parties or PASOK, but with the New Democracy lawmakers in the driver's seat.





The conservatives have said Greece needs to bargain harder with Europe on any deal.





Another scenario is that PASOK and the conservatives join in a longer-term grand coalition, or unity, government.





That option would give greater stability, as it would avoid elections, and could ensure that Greece stayed in the euro and the European Union, said Gemenis.





As for the planned referendum, the likelihood of it taking place appears to be diminishing.





Papandreou told his Cabinet Thursday he was backing off from a referendum vote because the opposition New Democracy party had agreed to the need to pass austerity measures required by the bailout.





And the office of Finance Minister Evangelos Venizelos said Friday he had confirmed to the European Commission that the referendum had been scrapped.





That news would certainly come as a relief to Europe's leaders. German Chancellor Angela Merkel and French President Nicolas Sarkozy warned Papandreou in Cannes Wednesday that Greece would have to leave the euro zone if voters rejected the bailout plan.





But Greece could find it hard to put the cat back in the bag now it's been allowed out, Conley said.





Although some observers say the referendum will not survive if Papandreou does not, she foresees a scenario where the Greek people demand a say in decisions that will affect them, and their country, for decades.





She warns it could also lead to the governments of other countries, such as the United Kingdom and Italy, facing calls for difficult decisions to be put them to a referendum.





The recent crisis has prompted talk of a "democracy deficit," she
When did George Papandreou face a confidence vote? What does Greece need to accept to remain in the eurozone? What do some in Papandreou's party say is needed? Who feels a national unity government is needed? What is Papandreou facing on Friday?
Friday night bargain harder with Europe on any deal. referendum on the latest bailout Tilemachos Chytiris A confidence vote in his government
question: When did George Papandreou face a confidence vote?, answer: Friday night | question: What does Greece need to accept to remain in the eurozone?, answer: bargain harder with Europe on any deal. | question: What do some in Papandreou's party say is needed?, answer: referendum on the latest bailout | question: Who feels a national unity government is needed?, answer: Tilemachos Chytiris | question: What is Papandreou facing on Friday?, answer: A confidence vote in his government