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Prime Minister George Papandreou chose the tiny island of Kastelorizo to announce the news, which immediately topped the global broadcasts. Greek economy can no longer serve its debts alone and has formally requested the activation of the European aid mechanism."I directed the Finance Minister to formally request the European Commission to activate the mechanism," Papandreou said in a solemn ceremonial televised address from the picturesque little port of Kastelorizo. Meanwhile it became clear that in the next few minutes Finance Minister George Papakonstantinou will gather journalists to inform them officially about the latest events. 

The PM compared Greece with a “ship ready to sink”, with a country without dignity and prestige even in front of its friends and partners. "This was our legacy from the previous government”, did not fail to emphasize Papandreou. He recalled that from the very first day his team had rolled up their sleeves and started the necessary reforms. As a special success, he defined the agreement reached on EU financial assistance for Greece, which he defined as "unprecedented in European history”. "Despite the extreme reforms the international markets did not believe in us and continued their speculative pressure against us, against the Euro and against the eurozone as a whole. They started borrowing us money at even higher rates. We will not allow this and therefore we want to activate the European mechanism for financial aid," said the Greek Prime Minister. 

In his televised address, George Papandreou promised that by activating the mechanism the government can focus on its main job, which is to reform the Greek economy and the country as a whole. "Our ultimate goal is to free the country from any kind of surveillance, control and guardianship. I'm sure we will succeed," he concluded solemnly. 

It was an open secret that the government of PASOK sincerely wanted to wait until local elections in Germany on May 9 to request activation of the mechanism. However, as Eurostat announced yesterday the true size of the Greek government deficit, Moody's lowered the credit rating of the country, and the spread-index reached 600 basis points, Papandreou's team realized that they could not postpone the inevitable anymore. Today the decisive step was made. In the coming hours Finance Minister George Papakonstantinou will inform the European Central Bank, International Monetary Fund and Eurogroup of the Greek government’s decision. 

Initial information shows positive response of the markets towards Greece's decision to request financial assistance from the European Union and IMF. For the time, the index of the Athens Stock Exchange marks a jump of 4.31 per cent compared to yesterday's horrible day. The spread-index is falling by 60 basis points, improved figures were seen in cds-insurance as well.

However these are not the reactions of people and politicians in Greece who fear that the involvement of the International Monetary Fund in help of the country's economy will bring a lot of hardships for the Greek people. Currently, mission of the Fund is in Athens negotiating with financial institutions of the country and insisting on more drastic cuts in wages and pensions in the public sector and a sharp reduction in the number of people working there. Envoys of the IMF also want tighter controls on tax authorities, which will make their work more effective. On the negotiating table is also the proposal for the abolition of the framework agreements and for a more flexible labor market in the private sector. 

International analysts, however, are adamant that the government of George Papandreou simply had no other choice than to request activation of the Rescue Plan of the European Union and IMF. Foreign debt is estimated at around €300bn and the troubled economy cannot serve it by itself. On May 19 Greece needs to liquidate government bonds with maturing worth of €11.3bn. European rescue mechanism will ensure about €45bn over three years, which payments will be supervised by the International Monetary Fund in accordance with the success of the reforms in Greece.