Greek Prime Minister George Papandreou today said there was 'no way' his debt-stricken country would drop the euro or seek aid from the International Monetary Fund.
'There is no way we will leave the euro or seek recourse to the IMF. We do not need to,' Papandreou told a nationally televised news conference to mark his administration's first 100 days in power.
Just hours earlier, a team of IMF experts began a week-long mission at Athens's invitation to mentor the Greek government on how to plug a multi-billion-euro hole in its public finances.
Recession-mired Greece had a budget deficit equal to 12.7% of total economic output last year, far above the 3% limit for countries sharing the euro. Total accumulated debt is put at 113% of gross domestic product, way about the EU's 60% limit and expected to go even higher.
'The sight we faced after the elections is beyond all imagination, with a debt and a deficit whose size is unprecedented,' said Papandreou, whose Socialist party came to power in October after defeating a Conservative administration which had ruled since 2004.
'Unless we plug these gaping wounds we will be constantly looking for money,' Papandreou said. 'It's now or never. It's a first rate opportunity to change everything, to turn the crisis into an opportunity,' he added.
The government, which must present its crisis plans to the European Commission by late January, has said it will cut the public deficit to 8.7% in 2010 by slashing spending and fighting tax fraud. It aims to bring the deficit to below 3% in 2012.
Across Europe, there is concern that serious fiscal problems in Greece and elsewhere threaten the credibility of the euro zone and could be a precursor to similar debt crises in other European economies.
European officials have criticised Athens for the failure to control its finances and the three main credit rating agencies all downgraded the country's sovereign debt standing last year.
Earlier this week, the European Commission published a damning report on Greece's 'unreliable' economic figures, increasing the chances of the EU executive launching infringement proceedings against Athens.
A report by the European Central Bank in December said there was little chance of a euro zone member leaving or being forced out but the fact the ECB produced such a document at all raised eyebrows in nervous financial markets.
