Luxembourg premier and finance minister Jean-Claude Juncker said late on Monday night that he expected Greece to emerge from its current financial crisis "in reasonable time." But he warned that the Greek population would have to prepare for significant cuts.

Juncker was speaking after a day of discussions among eurozone finance ministers about Greece's desperate financial situation. Despite being in the eurozone, the country's credit ratings have plunged following the revelation that its government deficit estimates for 2009 were grossly understated.

On Friday, Greece presented the commission with a new plan aimed at cutting its deficit from the currently estimated 12.7 percent of gross domestic product (GDP) to below the EU's threshold of 3 percent of GDP by 2012.

After Monday's meeting, Juncker said that the plan was a "step in the right direction," backing away from an assessment he made earlier in the day that it was insufficient.

"I'm convinced that the Greek government will be able to restore balance in their public finances in reasonable time," he said.

Athens' plan was earlier overshadowed by criticism from the EU's statistical arm Eurostat, which questioned Greece's ability to report accurate figures. This issue was set to take up discussions on Tuesday.

Returned to power

Juncker was also re-elected to his post at the head of the group of eurozone finance ministers on Monday, extending his tenure for another two-and-a-half years. Juncker has headed the eurogroup since 2005 and is seen as one of the most influential men in Europe's financial world.

"He was re-elected unanimously. I think it's a very good thing that after five years of an informal president of the informal group we have a formal president and it's the same one as the last five years. For my part I can say that I'm very happy," said the EU's economic commissioner Joaquin Almunia.

Under the European Union's Lisbon Treaty, which came into force in December, the informal eurogroup takes on a more formal status with a president serving a two-and-a-half-year term.

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Editor: Kyle James