Page last updated at 19:50 GMT, Wednesday, 16 December 2009

Greece is downgraded by a second credit rating agency

George Papandreou, 14 December 2009
Prime Minister Papandreou has outlined a plan to tackle 'systemic corruption'

A second international ratings agency has downgraded Greece's credit rating, saying the government's spending cuts will not be enough to trim its debts.

Standard & Poor's said Greece's cost-cutting measures were "unlikely, on their own, to lead to a sustainable reduction" in its public debt.

Its downgrade comes two days after the Greek government unveiled measures including a 10% cut in public spending.

Fellow ratings agency Fitch downgraded Greece last week.

Domestic obstacles

"We believe that the government's efforts to reform the public finances face domestic obstacles that would likely require sustained efforts over a number of years to overcome," said Standard & Poor's.

A credit rating cut indicates to global investors that a country is a more risk-prone place in which to invest.

Greece's public debt stands at 300bn euros ($442bn; £269bn), while its public deficit tops 12%.

As well as reining in spending, the Greek government has also vowed to tackle corruption and excess red tape.

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CNN Greece attacks S&P over downgrade - 2 hrs ago
Reuters Africa Greek markets hammered as strikers march - 13 hrs ago
Business Report Greece hit by strike after downgrade - 13 hrs ago Pressure Mounting On Greece - 17 hrs ago
Deutsche Welle Greek unions leave work to protest austerity measures - 18 hrs ago

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