When Greek Finance Minister George Papaconstantinou met with foreign reporters recently in his office to discuss the country's soaring deficit, he was constantly fingering his worry beads as he spoke.

Local reporters would not have even mentioned the traditional habit of Greek men, but the foreign media immediately read something into the occurrence.

Since the recent downgrading of the country's credit rating, the new government has tried to fight back, insisting it has the ability to control the deficit and structural woes that have earned the country a reputation as the weak link in the euro zone.

"We will reduce the deficit, we will control the debt and there will be no need for a bailout," Mr. Papaconstantinou emphatically stated to reporters.

However, as he spoke at that time the country's capital was in the midst of a major strike, as well as continuing, and often violent, demonstrations that made Greece the lead story in the print and broadcast media around the world.  

Common in Greece even during better times, such protests are expected to increase drastically once the government introduces austerity measures in its 2010 budget, including wage freezes and measures to scale back public sector hiring, steps it says are needed to bring Greece’s finances under control.

Indeed, Spyros Papaspyros, president of the civil servants’ union, has already stated that the union was prepared to strike if cutbacks were unilateral and severe.

The political and social challenges are intense.

 "It will be a very tall order for any country to pull off the fiscal rescue they’ve now got to pull off," said Simon Tilford, the chief economist at the Centre for European Reform in London. "I find it at this point difficult to see how Greece is going to manage this without some kind of fiscal crisis."

The dire economic situation, seen as the country's worst crisis in three decades, has prompted the question of what went wrong in a country that was once seen as a model for European Union membership and that enjoyed 15 years of sustained growth, coming from behind to host the 2004 Summer Olympics.

In the wake of all the bad press, Prime Minister George Papandreou stressed the need for drastic measures, calling for a "merciless crackdown on the corruption that is endemic in society and on widespread tax evasion."

Greece's entrenched underground economy, estimated at around 30 percent of gross domestic product, helps local citizens, since prices in Greece are equal to, or above, the EU average, while salaries are far below neighbouring countries.

Now, that's something to the worry about.