Chancellor Angela Merkel pledged Germany's continued support for Greece amid violent protests against her visit to Athens, the first since the eurozone crisis hit Greece in 2009.
Speaking after talks with Greek Prime Minister Antonis Samaras, Merkel said Greece has made progress toward reducing its huge budget deficit but added "there is still room" for improvement in tax collection and local government spending.
The German leader said she had come to Athens in full knowledge that the period Greece is living through is a very difficult one.
"I came here knowing all too well that this is an exceptionally difficult time for Greece, and especially for the people of Greece," Merkel said. "They're going through a difficult period, a lot is being asked of them, and that's why I must stress how far they have traveled down this difficult road. We heard yesterday at the Eurogroup that there has been a lot of progress. There is progress everyday in dealing with the difficult problems."
Greek Prime Minister Antonis Samaras talks with German Chancellor Angela Merkel in Athens.
Merkel also said Greece should remain in the eurozone.
Samaras said he told Merkel that Greeks "are bleeding at the moment" but will stay in the eurozone and would stick to the reform path.
"I had the chance to say to the chancellor that Greece is determined to keep its commitments and to overcome the crisis," Saramas said. "The basic precondition for that is for it to get out of the recession and unemployment, which are paralyzing the economy."
The Greek government is currently negotiating with lenders on more budget cuts to secure the next installment of a 130-billion-euro bailout.
Without the next tranche of 31.5 billion euros, the Greek government says it will run out of money by the end of November.
Merkel also held talks with President Karolos Papoulias before departing Greece after a six-hour visit.
Some 50,000 people gathered in downtown Athens to protest her visit and austerity measures amid a heavy police presence. More than 7,000 police from all over Greece had been deployed to Athens to keep protesters at bay.
Protests were largely peaceful, but riot police had to fire tear gas and stun grenades at several dozen people who were throwing stones and petrol bombs at them. At least 40 people were arrested.
Many Greeks blame Merkel for forcing Greece to implement harsh cuts in exchange for bailout deals to avoid bankruptcy.
Syriza party leader Alexis Tsipras, who took part in the protest, told journalists that Greeks refuse to be experimented upon.
"Our message is one: Democratic tradition in Europe will not allow the Greek people, a European people, to be turned into a guinea pig of the crisis and for Greece to become a social cemetery," Tsipras said. "We will win in the end because justice is on our side and the people mean more."
Comentators, however, said that Merkel's trip was more notable for its symbolism than for producing concrete measures to help Greece bring its crisis to an end.
With reporting by Reuters, dpa, AP, and the BBC