Greek PM George Papandreou

Prompted by an unexpected announcement by Greek Prime Minister George Papandreou that he'd put to referendum a bailout plan to aid his country and stem the European debt crisis, German Chancellor Angela Merkel and French President Nicolas Sarkozy held emergency talks on Greece Tuesday. 

European leaders called the bailout "more necessary than ever" and pressed Greece to uphold the bailout one day before a global summit. 

The shocking move by Papandreou has ruling party lawmakers demanding his resignation, and could send the Greek government into collapse, according to Reuters.

Papandreou even caught his own finance minister by surprise. 

Sarkozy and Merkel will meet with Greece leaders on Wednesday to push for a quicker installation of the bailout deal. 

The stock markets also plunged in light of the bombshell. Some analysts said the move increases the chances for a euro-zone break-up.