Easing Greek woes

The deal under consideration would see the 15 other euro zone countries issue 20-25 billion euros in aid in the form of loans and guarantees, weekly German newsmagazine Der Spiegel reported.

The report said each euro zone country's contribution to the package would be calculated according to the proportion of capital each holds in the European Central Bank.

Germany's contribution would reportedly amount to around four billion euros and be handled by the state-owned development bank, the KfW.

The government of Chancellor Angela Merkel has so far held off on committing any aid to Greece over fears this would cause other troubled euro zone countries to go easy on reforms to their economies in the hope of also receiving bailout packages.

"Crisis as a chance"

Greece is currently trying to rein in a deficit of 12.7 percent of GDP, more than four times the limit allowed by euro zone regulations. The government of Greek Prime Minister Georgiou Papandreou said it was aiming to reduce the deficit to below three percent by 2012.

Papandreou said he was confident this ambitious target could be met by clamping down on bribery and corruption. "We need to understand the crisis as a chance to launch the necessary reforms," he said in an interview for a separate report also to run in Der Spiegel on Monday.

Greece's economic woes have hit the euro currency hard, threatening to plunge the economic bloc into its first fully fledged crisis since the creation of the euro more than 11 years ago.

dfm/dpa/Reuters

Editor: Sonia Phalnikar