Greeks face long hardship after bailout deal

Athens: Greece has agreed terms with the European Union and IMF opening the door to a multi-billion euro financial bailout, Prime Minister George Papandreou said on Sunday, but his people face years of painful sacrifices.

The aid package, expected to total around 120 billion euros (about Dh586 billion) over three years, still needs backing from Greece's European peers as a May 19 deadline looms when Athens badly needs funds to make a big debt repayment to its creditors.

In exchange for the largest international financial bailout by far assembled for any country, Athens announced spending cuts and tax increases totalling 30 billion euros (about Dh146 billion) over three years — on top of measures already agreed.

Greeks have already taken to the streets to demonstrate against the austerity drive and previous governments have backed off reforms to defuse often violent protests.

Unprecedented aid

But politicians in Germany — where public opinion is hostile to any handouts — made clear that Athens should not take approval for granted.

The package is the first rescue of a member of the 16-nation euro zone and aims to stem a debt crisis that has shaken financial markets worldwide.

"It is an unprecedented support package for an unprecedented effort by the Greek people," a sombre Papandreou told a televised cabinet meeting.

"These sacrifices will give us breathing space and the time we need to make great changes," he added. "I want to tell Greeks very honestly that we have a big trial ahead of us."