The head of the International Monetary Fund, Christine Lagarde, started 2012 by saying it would be a tough year, with the global economy likely to grow more slowly than anticipated.
"Clearly we should all be prepared for a 2012 that will not be a walk in the park, but that will be one of effort and focus on a combination of issues. The first one being clearly the European crisis and its resolution, which will take the joint efforts of the Europeans on the one hand, and of the international community on the other hand."
And 2012 was not a walk in the park for many Eurozone countries.
In response to the crisis, all European Union countries, except Britain and the Czech Republic, agreed to sign up to a new treaty designed to stop overspending in the countries that use the euro as their currency.
The so-called fiscal compact was agreed to at a summit of European leaders in Brussels.
The 27 EU leaders attended the summit in January, with the hope of stimulating economic growth and creating employment across the region.
Greece in particular came under criticism at the summit from Germany's Chancellor Angela Merkel.
She said not enough was being done in Greece to overcome its debt crisis.
"It's always keeping with the spirit that we want to help Greece to come back to the path that is necessary for Greece to stand back on its own feet and complete its tasks itself. I think if we look at the debate, that conclusion, the Greek government will have to give its contribution to make this possible, and it is important that we come to an conclusion quickly, and the Greek government will have to contribute their part to it. It is also important that in the time where the elections are getting closer, that the Greek political parties feel duty-bound to this program, it is important that the private investors participate, and it is important that all other partners stick to their commitment."
By anyone's definition the economic situation facing Greece continued to be difficult in 2012.
The year started with mass protests as MPs continued debating an unpopular 160-billion dollar austerity bill.
In February Greece's parliament approved the austerity bill, paving the way for harsh reforms in return for the $160-billion bail-out package.
Credit rating agency Standard and Poor's also raised concerns about nine other Eurozone countries, saying Eurozone leaders had failed to properly deal with the debt crisis.
Included in its credit rating downgrade were Italy, Spain and France.
The European Union's economics commissioner Olli Rehn called on member states to reduce spending and create a more robust rescue fund to prop up countries in financial crisis and to help avoid a further crisis for the eurozone.
"Let's be frank, this is the case at least, in case we want to avoid a disintegration of the eurozone and instead make the euro survive and succeed for the sake of its member states and especially of its citizens."
Greece went to the polls in May with the majority of Greeks voting for parties that rejected the country's bailout agreement with the EU and International Monetary Fund.
Greece returned to the polls on June 17 after attempts to form a coalition government failed.
The second election resulted in a victory for the pro-bailout New Democracy Party.
Meanwhile Spain's Prime Minister, Mariano Rajoy, announced an $80-billion austerity package to avert financial collapse, triggering large protests in Spain.
The package included cutting state spending and breaking a promise not to raise the value-added sales tax, instead boosting it to 21 per cent.
The Spanish government also requested more than $120 billion in financial assistance from the EU to recapitalise its banks.
Mr Rajoy defended the moves mid-year in an address to parliament.
"The road to European unity has never been easy. There has been and there will be tension. Unanimous votes in the European Council are hard to come by but at least we know where we want to get to. In front of this chamber, I vow to deliver the compromise that's been reached and to do so as swiftly as possible."
The Portuguese government also pushed ahead with a draft 2013 budget that includes massive tax rises and spending cuts.
The measures were a requirement after an EU bailout worth more than $90 billion was approved.
In November, Europe's leading trade union organisation mobilised workers across the European Union for a series of protests against growing unemployment and austerity measures.
The rallies, organised by the European Trade Union Confederation, took place in 23 countries, including Spain, Portugal, Greece, France and Belgium.
The confederation's Bernadette Segol led a rally in Brussels.
"This demonstration is to say very loudly that austerity policies are not working. They are affecting the weakest of the population, and we must change course to have growth, sustainable growth, and employment. That must be the priority. Europe must have a social priority."
Later in the year, EU leaders agreed to a framework for establishing a single eurozone banking supervisor and Greece also agreed on further structural reform measures and approved an austerity-focused budget for 2013.
And 2013 looks like again being a rough year for the Eurozone.
Late in 2012, the Secretary General of the Organisation for Economic Co-operation and Development, Angel Gurria said the global economy was set for a sharp slowdown .
And he said the eurozone debt crisis continued to pose the greatest threat to the world economy.
"A hesitant and uneven recovery is projected for the OECD area. Yet again. The euro area will remain in or near recession well into 2013. Growth is expected to pick up in the United States and Japan, but only gradually. And a quicker recovery is expected in the emerging market economies."
European Union representatives deflected criticism after the Nobel Committee awarded the 27-member bloc the Nobel Peace Price in October.
The prize was awarded to the EU for promoting peace, democracy and human rights over six decades.
In his speech at the ceremony, EU president Herman Van Rompuy said the EU deserved the recognition, despite its current economic woes.
"At a time of uncertainty, this day reminds people across Europe and the world of the union's fundamental purpose: to further the fraternity between European nations now and in the future. It is our work today, it has been the work of generations before us. And it will be the work of generations after us."
The year ended on a better note for Greece, with Prime Minister Antonis Samaras welcoming the European Union's release of long-awaited rescue funds.
It came after ministers from the 17-nation Eurozone agreed to make available more than $60 billion of aid as part of the bail-out package.
The money had been blocked since June over concerns Greece was not sticking to economic reform vows, and might not be able to pay back its debt.
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