World stock markets have tumbled following the downgrading of Greece's debt by the rating agency Standard and Poor's.
Greece thus becomes the first eurozone member to have its debt downgraded to what is informally known as "junk" status.
Portugal's debt has also been lowered because of fears of "contagion", adding to the markets' slide and a fall in the euro.
A Portugese economist and former member of the European Parliament, Paulo Casaca, says that investors are nervous and that Europe is in great danger.
Explaining the downgrade, Standard and Poor's cites a weak economic forecast for Greece and concerns that its government will find it increasingly difficult to meet any new stringent demands by its European partners and the International Monetary Fund (IMF) to cut its budget deficit and raise taxes.
IMF head Dominique Strauss-Kahn is due in Berlin shortly to try to overcome German doubts about rescuing Greece, which wants 40 billion euros from eurozone governments and the IMF to shore up its finances.