The Greek problem is more a problem of governance and a lack of transparency, Prime Minister George Papandreou said on Thursday.

In his opening address during a discussion on economic reforms in the European Union, the Greek premier said a year ago people asked if Greece would default.

"We took all measures with responsibility, we did our duty. We emphasised full transparency and already we are one of the most transparent countries in the world. We cut the deficit by 6.0 pct, resolved the pension problem and are opening up closed professions. But markets have not reacted yet," Papandreou said.

He noted that financial system should be more transparent and added that the necessary tools are needed to calm markets.

Commenting on the European Financial Support Fund (EFSF), Papandreou said it should be robust and flexible. Europe is currently debating financial governance, equality and common values, he said, adding that Europe was a large and peaceful project. "We want Europe to be a model of governance and green growth," he added.

Meanwhile, on the sidelines of the eponymous World Economic Forum in the Swiss resort of Davos, Papandreou met with the forum's president and founder, Klaus Schwab. The latter reportedly praised the Greek PM and people's efforts over the recent period.