Papandreou addressed parliament on the economic situation, one day after a team of E-U officials visited Greece .

They expressed scepticism over Greece´s economic targets.

That could prompt the government to take even tougher measures than those already outlined in the current austerity plan.

Papandreou said the previous government caused the massive debt problem that Greece faces today.

He said the worst fears regarding Greece´s economy have been confirmed.

But he vowed to do whatever it takes to turn the economy around.

The government´s economic program calls for deep cuts in welfare spending, PLUS wage and hiring freezes, tax hikes and other reforms.

The program has angered unions, but the general public is supporting the government, for now.

EU inspectors, who visited Athens, saw Greece deviating from its ambitious deficit-cutting targets because of G-D-P contraction and high borrowing costs.

The inspectors expect the deficit to G-D-P ratio to be cut by only 1-POINT-5 to 2 percentage points.

That´s versus a 4 percent target by the government this year.

A Greek finance ministry official has said any further measures to reach targets would be announced after a visit by E-U Commissioner Olli Rehn next week.

In October, Greece shocked markets and EU policymakers when it  that its 2009 budget deficit had spiralled to nearly 13-percent of GDP.

That raised questions about Greece´s ability to service its debt.

Papandreou said if changes were not made now, the future consequences would be even more serious.