Has Greece – finally – done enough? First impressions suggest today’s latest austerity measures, equivalent to €4.8bn, or about 2 per cent of gross domestic product, will help restore Athens’ credibility in financial markets. More importantly, they should rebuild faith in the European Union’s ability to put its own house in order.

Greece’s agony has been drawn out. Faced with a massive deterioration in public finances, largely hidden by the previous government, the Socialist administration of George Papandreou, prime minister, has gone through phases of denial and anger since being elected last October. Now, apparently, it has moved into acceptance. That probably has a lot to do with the presence of high-level European Commission and European Central Bank delegations in Athens this week – including Jürgen Stark, the German ECB executive board member known for his hard-line defence of EU fiscal rules.

Luigi Speranza, economist at BNP Paribas, argues that today’s announcement “dramatically enhances the credibility of the Greek commitment to comply with the announced fiscal targets”. Athens’ submission to Brussels and Frankfurt, he adds, Read more