Describing his country’s economy as ”œa sinking ship,” the Greek prime minister formally requested on Friday an international bailout, testing the solidarity of the European Union as never before.
”œWe drew up a plan, we took difficult and painful measures,” Prime Minister George A. Papandreou said in a nationally televised address. ”œBut the markets did not respond.”
Concerns about the Greek budget deficit ”” an estimated 13.6 percent of gross domestic product last year ”” have pushed interest rates on Greek bonds above those of emerging countries like India and the Philippines, leading to talk of a potential default and years of stagnant growth.
”œThere is the risk of the sacrifices of the Greek people being lost as rates of borrowing continue to rise,” Mr. Papandreou added, speaking from the Aegean island of Megisti. ”œThe time has come for us to ask our partners in the E.U. to activate the mechanism we formulated together.”