The eurozone bailout Greece is desperate to clinch this week may rescue its banking and financial system but the path to real economic recovery will be long and hard, economists have warned.

"If the (economic recovery) memorandum is implemented, it can certainly save Greece from bankruptcy," said Miranda Xafa, head of EF Consulting and a former board member for Greece at the International Monetary Fund.

'But no one can save Greece from recession at this point' she told AFP last week amid on-again, off-again, on-again hopes for a rescue agreement.

The Greek parliament has approved a series of measures worth 3.2 billion euros in return for a new eurozone bailout providing 100 billion euros ($132 billion) in aid and another 30 billion euros to bolster its banks.

A bond write-down expected by private creditors would be worth another 100 billion euros.

Eurozone finance ministers were to discuss on Monday whether Greece now qualifies for the bailout, which it needs to avert a default on March 20, when a bond issue worth 14.4 billion euros comes up for redemption.

Violent protests in Athens against the plan highlight popular unrest as austerity policies undercut growth and politicians struggle to stick to their commitments. Meanwhile, Greece's macro-economic indicators are flashing red.

Figures released last week showed a five-year recession accelerating to a seven-percent contraction in the fourth quarter of 2011, outracing an earlier estimate of 5.5 per cent for the whole year included in the latest budget.

Estimates for this year already point to a contraction of between four and five per cent. This is due to Greece's 'twin deficit,' Xafa explained.

"Consumption, private and public has to come down, and output has to increase, but it cannot be done instantly" she said.

The Greek economy has not kept pace with global developments and does not produce the kinds of goods or services in demand elsewhere at competitive prices.

"If Greece had implemented the structural reforms that were in the first memorandum, we would not be in this condition now," Xafa noted in reference to Athens' initial loan agreement with the EU and IMF in 2010.

While stabs at change were made, authorities pulled their punches when it came to a drastic overhaul of privileges in the public sector, the traditional voter pool for successive governments.

"In the pension system, there were only horizontal cuts. They should have brought pensions much closer to the contributions of the people," Xafa said.

"It's a very unfair system. Public sector pensions are very high because they are close to politicians. They did not want to touch the special interest groups from which they derive their political power".

Vassilis Monastiriotis, a senior lecturer in the political economy of South Eastern Europe at the London School of Economics, said measures now demanded by Greek creditors were 'very one-sided' and 'produce more austerity'.

"They reduce incomes, more they also reduce investment confidence," Monastiriotis argued.

Inside Greece, even business-oriented economists say wages were not the main obstacle to restoring competitiveness.

"It is not fair to create low-salary countries, this is not part of the original European deal," said Angelos Tsakanikas at the Institute for Economic and Industrial Research (IOVE).

He insisted the emphasis be placed on cutting red tape. "You cannot export a container on a Saturday because customs are closed" in Greece, he said. In other countries, 'ports are open and at no additional charge'.

As for building permits, 'the whole system is very slow. It takes three to five years to get an environmental permit' to expand a factory or build a hotel on a Greek island, Tsakanikas noted.