However, the policies adopted were timid, even though markets had started moving towards an overall reassessment of credit risk that did not preclude a Greek default, therefore imposing new, more onerous lending conditions. By early 2010 it was no longer possible to cover the deficits with financing from the markets. In Greece, the international financial crisis was evolving into a sovereign debt crisis.
In April 2010 the Greek government submitted to the euro area countries and the IMF a request for financial support, and in May the first Memorandum of Economic and Financial Policies was signed. This triggered a process of sharp economic adjustment in order to avoid default and lay the groundwork for rebalancing the economy.