Brussels - Europe turned the screw on Greece on Tuesday in a bid to regain market confidence, after giving Athens just 30 days to burst its bulging deficit and debts.
Non-eurozone Sweden led the charge going into a full meeting of European Union finance ministers in Brussels, warning that Athens must "surpass" financiers' expectations if it is to fight off market attack dogs.
A decision by the 16 euro countries late on Monday to impose "additional measures" on Greece by March 16, further cutting costs and raising taxes should progress be deemed insufficient, was to be rubber-stamped on Tuesday.
And Swedish finance minister Anders Borg warned that the Greek government must go much further than it already has if it is to deliver on a stated target of reducing its 2009 deficit-to-output ratio by almost one third this year alone.
"What we've seen so far is not enough," Borg warned. "We need more concete steps when it comes to taxes, otherwise they can't keep their social cohesion. (And) we need concrete steps when it comes to expenditure.
"We are far from there yet. If they want to build credibility in the markets, they must surpass expectations. And they haven't done that so far."
Plans to shore up euro
Borg maintained that without a more ambitious programme in Athens, a months-long onslaught by international fund managers and investors on Greece which has pulled the euro down against the dollar will only "drag out."
Greece, whose Prime Minister George Papandreou held talks on Tuesday with Russian leaders in Moscow, is committed to reducing a deficit running to 12.7% of gross domestic product by four percentage points over the course of 2010. The eurozone has a 3% limit for deficits.
However, the country's euro partners have now effectively seized control of its budgetary sovereignty, with radical new constraints set to be imposed after finance ministers cut Athens out of the decision-making process.
"If we observe a certain number of risks materialising, the Greek government has agreed to take additional measures" to prevent a worsening fiscal haemorrhaging, said Eurogroup chief Jean-Claude Juncker.
Juncker, who also said after Monday's talks that contingency bailout plans are being prepared to shore up the euro, meanwhile insisted that "the financial markets are completely wrong if they think they can destroy Greece."
On Tuesday, the Luxembourg premier declared the additional call by Borg for greater International Monetary Fund surveillance and monitoring to be an "absurd" irrelevance "fuelled by Anglo-Saxon voices" seen as hostile to the shared currency.
'Several avenues can be envisaged'
"If California had a refinancing problem, the United States wouldn't go to the IMF," Juncker said.
Drastic action by the Greek government has already sparked strikes and protests at home.
But Greek Finance Minister George Papaconstantinou failed on Monday to elicit publicly the "explicit message" he wanted from his euro peers detailing concrete, financial help from Brussels.
The additional measures, to be administered under the beady eyes of European Commission inspectors and focused on expenditure cuts, should also encompass a VAT increase and extra duties on luxury goods including private cars, Juncker spelled out.
While market analysts have been calling for numbers to be revealed to show how far the eurozone will go to rescue Greece, Spanish Finance Minister Elena Salgado said on Tuesday that no details of bailout planning would be released to speculators.
France's finance minister Christine Lagarde said on Monday that "several avenues can be envisaged" after EU leaders last week vowed then to implement "determined and coordinated measures" to "safeguard financial stability."
Greece's ballooning public deficit has seen its total debt shoot up to about €300bn, or 113% of GDP, nearly double the 60% eurozone limit.
Moody's credit rating agency calculates that Greece must allocate 15.1% of all its revenues just to service its debts this year.
- AFP