February 21, 2012
Greeks will suffer austerity measures for another five years as the price of their government securing a €130bn (£109bn) bailout to prevent national bankruptcy and chaos within the eurozone, it has emerged.
The scale of the wage and spending cuts required to implement the rescue package prompted an array of analysts to raise the spectre of yet another Greek debt crisis later this year and the country's exit from the euro as recession deepens.
But Olli Rehn, the EU economic and monetary affairs commissioner, said Greece had lived beyond its means for a decade and savage cuts in labour costs were vital to restore competitiveness and growth.
The Greek prime minister, Lucas Papademos, and finance minister Evangelos Venizelos talked up the agreement, reached after 14 hours of talks at 5am on Tuesday, as "avoiding a nightmare scenario."
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