Athens needs the 8 billion euro payment to avoid bankruptcy next month, but said Sunday its budget deficit would be 8.4 percent of GDP this year, above the level agreed under the terms of the bailout.

Worries over the impact of Europe's debt crisis on global growth sent stocks plunging around the region, with Hong Kong down 4.24 percent in mid-morning trade.

Japanese stocks plunged 2.26 percent by the break as global growth fears overshadowed an improvement in the Bank of Japan's closely watched Tankan survey of business confidence.

Sydney was off 2.12 percent, Singapore was down 1.79 percent and Taipei slipped 1.69 percent, while the euro fell against major counterparts.

Wellington fell 0.59 percent. Markets in South Korea and China were closed.

Finance ministers of the 17 countries sharing the beleaguered euro currency were to meet in Luxembourg to discuss Greece's progress, as the bloc grapples with how to safeguard its banks and boost its 440 billion euro rescue fund.

"It is far from a given that policymakers will succeed in turning the tide in markets in the final quarter of the year," Sharon Zollner, senior economist at ANZ Bank in Wellington, told Dow Jones Newswires.

The United States and many Asian markets saw their worst quarterly losses since the 2008 financial crisis in the fear-fuelled third quarter, as investors dumped equities for safer assets on worries over a global recession.

Trading in the fourth calendar quarter got off to a sour start on Monday as markets followed Friday's 2.16 percent fall by the Dow Jones Industrial Average.

Eurozone ministers meeting on Monday will mull how to avert a Greek default, which could send stock markets into a panic, deal an unprecedented blow to the European currency and bring the world back to the brink of a fresh financial crisis.

Inspectors from the International Monetary Fund, the European Union and European Central Bank are in Athens to decide whether Greece has done enough to receive the crucial bail-out installment.

On Sunday, Greece said its budget deficit would be cut in 2011 and 2012 after its cabinet approved heavy budget cuts that would see thousands of public sector workers dismissed, but would still miss targets set by the EU and IMF.

Greece's budget deficit should drop to 8.5 percent of GDP in 2011 from 10.5 percent last year, above the target initially fixed in June, the government said.

Austrian Finance Minister Maria Fekter told Germany's Welt am Sonntag newspaper she thought the eurozone was likely to grant Greece a new slice of aid.

"The likelihood that the next eight-billion-euro ($11-billion) slice of aid will be paid out to Greece is, in my view, clearly higher than the likelihood it will not be paid," she said.

"It should not be the case that the payment of individual tranches of aid become a battle every three months because Greece threatens to fall short of the conditions," she added.

However, the euro slipped in Tokyo trade to $1.3337 from $1.3451 in New York late Friday. The European unit sagged to 102.75 yen from 103.12 yen.

The dollar was flat at 77.03 yen.

In Tokyo, Japanese exporters fell on concerns about the European economy following a jump in the eurozone's annual inflation rate for September. Sony plunged 5.77 percent and Nissan slipped 2.16 percent.

The worries overshadowed the Bank of Japan's closely watched Tankan survey that showed Japanese business sentiment turned positive in the third quarter as companies recovered from the impact of the March 11 earthquake and tsunami.

But analysts warned that the corporate outlook was cautious given the risks posed by a strong yen and the impact of the eurozone crisis and a slowing US economy on global growth.

Those concerns continued to weigh on crude prices, which followed equities lower in Asian trade Monday as a strengthening greenback weighed on oil markets, analysts said.

New York's main contract, light sweet crude for delivery in November, shed 50 cents to $78.70 a barrel.

Brent North Sea crude for November delivery dipped 77 cents to $101.99.

Spot gold was at $1,626.20 per troy ounce, up $1.40 from Friday's New York close.