What is happening in Greece right now?

What is happening in Greece right now?

Its long-term deficit cutting plan aims to drastically reduce the budget shortfall to less than 3% by 2012.

Greece has pledged to reduce this to 8.7% during 2010.

In order to do that, the government is planning a package of austerity measures. It wants to freeze public sector workers' pay and raise taxes, and it has also announced a rise in petrol prices.

It also intends to raise the average retirement age in an attempt to save the cash-strapped pensions system.

How has this been received in Greece?

Not at all well. About 30,000 Greek taxi drivers staged a 24-hour strike to protest against the government's financial reforms.

Public sector workers in Greece are planning a series of crippling nationwide strikes.

They believe that the crisis has been engineered by external forces, such as international speculators and European central bankers.

What happens next?

The EU has pledged to help Greece - but no details of any exact proposals have been released.

Eurozone finance ministers are meeting in Brussels this week to discuss the Greek situation.

Greece has been told that it must make further spending cuts or face sanctions, eurozone chief Jean-Claude Juncker says.

The country has agreed to outline additional cuts by 16 March, if necessary.

But the eurozone leaders have told Greece it faces penalties if its debt reduction plans are not shown to be on target by that date.

Will Greece have to leave the euro?

Currency traders have feared that some countries with large budget deficits - such as Greece, Spain and Portugal - might be tempted to leave the euro.

A country which left the euro could allow its currency to fall in value, and thus improve its competitiveness.

But it would cause huge ruptures in the financial markets as investors would fear other nations would follow, potentially leading to the break-up of the monetary union itself.

However, the EU has vowed to keep the eurozone together and dismissed talk of countries leaving the euro.

Is Greece the only country in trouble?

There are fears that Greece's troubles in the international financial markets will trigger a domino effect, toppling other weak members of the eurozone such as the so-called "Piigs" - Portugal, Ireland, Italy and Spain as well as Greece - all of whom face challenges rebalancing their books.

And Greece's woes mean there are fresh fears about whether Portugal and Spain can repay their debts.

That's because they all could face higher costs, as investors sell their holdings of the government debt and make it more expensive for them to borrow.