Greece, Greek Debt Crisis | featured news

Chancellor Angela Merkel of Germany said that Greece should solve its own problems, ahead of a summit meeting scheduled for Thursday.

Greece's cabinet approved a sweeping new austerity program on Wednesday, the third in as many months, intended to rein in a bulging budget deficit and secure European financial support.

BRUSSELS (Reuters) - Greece must take additional measures to reach its deficit-cut target of 4 percent of GDP in 2010 but it is not yet clear how far short Athens is with steps announced so far, the European Commission said on Tuesday.

Corruption and impunity from prosecution lie at the heart of Greek's debt crisis, Prime Minister George Papandreou said on Monday, calling on citizens to stomach the pain required to put the country back on track.

Greece plans to issue a 10-year bond next week to coincide with the announcement of a new austerity package. Government debt markets remained under heavy pressure.

Tens of thousands of strikers marched through Athens on Wednesday to protest against austerity plans aimed at wrenching Greece out of a debt crisis that has shaken the euro zone.

European finance ministers said in a statement that Greece must show by March 16 that it is on track to cut its deficit.

European leaders have reached a deal to provide aid to Greece, EU president Herman Van Rompuy said on Thursday, in an unprecedented move to stave off a broader crisis in the 16-nation bloc that shares the euro.

European leaders were close to agreement on measures aimed at persuading jittery investors that Greece will not be allowed to default.