LONDON — European countries and the International Monetary Fund on Sunday threw Greece a lifeline worth a stunning $146 billion after the financially foundering nation unveiled a stinging program of spending cuts and tax increases to reduce its enormous government deficit.
At an emergency meeting in Brussels, finance ministers from the 16 nations that use the euro currency signed off on the bailout package, which would grant low-interest loans to Athens to help it avoid a humiliating bankruptcy. The money would be available over the next three years and would come from the International Monetary Fund and fellow Eurozone countries such as Germany and France.
"This assistance will be decisive to help Greece bring its economy back on track and preserve the stability of the euro area," said Jose Manuel Barroso, president of the European Commission, who described the bailout as an act "of solidarity and responsibility."
In exchange for the aid, the Greek government was forced to commit to new austerity measures on top of ones announced in March. The painful retrenchment will almost certainly encounter vociferous opposition from unions and social activists in a country already racked by economic protests in recent weeks, but officials said their hands were tied.
"The choice was one between seeing the nation crumble or moving to save it," Finance Minister George Papaconstantinou said. "We chose the latter."
The loan package came in response to the severest test to hit the euro since it debuted 11 years ago, an escalating debt crisis that has weakened the currency and rattled stock exchanges around the world. The massive rescue plan is an expanded version of one proposed last month, and is still subject to approval by parliaments in some Eurozone countries.