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Tags: Greeks | Strike | Job | Cuts | Aid

Greeks Strike Against Papandreou Cuts, March to Parliament

Wednesday, 05 October 2011 10:13 AM

Greeks walked off their jobs across the nation and as many as 20,000 marched through Athens’ central square to protest Prime Minister George Papandreou’s 6.6 billion-euro ($8.7 billion) austerity plan, challenging a government seeking European bailout funds to stave off default.

The 24-hour strike shut the Athens International Airport, causing 448 flight cancelations, and shuttered schools and archaeological sites to protest Papandreou’s plans to put 30,000 public workers on reduced pay, raise property taxes and cut pensions and wages in a bid to win European Union financing.

“They are blaming us, firing us with the result that we won’t be able to live,” said Katerina Anastasopoulos, 53, who has worked at the Greek Transport Ministry for 28 years and joined the march on parliament. “They are taking away our livelihood, our life. We are all scared.”

Police estimated about 20,000 people, carrying banners and shouting slogans like “Take Your Memorandum and Leave” marched through the square, which is bordered by the parliament building on one side and Finance Ministry on the other.

Greek police used tear gas to disperse a group of hooded protesters attacking police with pieces of marble and plastic bottles.

The country’s largest public-sector union, known as ADEDY and representing at least 400,000 state workers, called the walkout after European Union ministers signaled yesterday that they may renegotiate terms of Greece’s latest rescue, sending the nation’s stocks down the most in 17 months.

The demonstration defies calls by the government to show unity in the struggle to avert a default.

‘Worst Circumstances’

“We are at the worst circumstances under the worst conditions,” Finance Minister Evangelos Venizelos said at a news conference in Athens yesterday. “We are dependent on the aid and loans of our institutional partners. That is the situation of the country. And we must make superhuman efforts to win this wager of history.”

The ASE stock index rose 1.6 percent today at 3:26 p.m. in Athens after tumbling 6.3 percent yesterday, the most since May 2010. The yield on Greece’s 10-year bonds climbed 11 basis points, or 0.11 percentage point, to 23.2 percent, more than double the rate on July 21, generic pricing for euro-denominated securities shows.

The government is dependent on outside financing as the economy contracts and the unemployment rate stands at more than double Germany’s. The Greek state, which employs about 750,000, carries a debt load that will reach 356.5 billion euros in 2011, or the equivalent of 161.8 percent of gross domestic product, the highest in the EU and three times the ratio of Poland.

Loan Delay

The strike followed a decision by euro area finance ministers to delay the release of the next 8 billion-euro loan installment under a 110 billion euro bailout approved in May 2010 until after Oct. 13. The government has enough cash to operate until mid-November, Venizelos said.

Violence during strikes in June caused 800,000 euros in damage to state property in Athens over two days as Papandreou battled for political survival in parliament.

The 59-year-old premier then won a confidence vote and backing for a new five-year package of budget cuts and state asset sales to secure further international aid by stemming defections from members of his Pasok party.

Venizelos introduced measures to plug the budget gap for 2011 and 2012, including a property tax approved by parliament on Sept. 27 and further cuts to pensions and wages for state workers, after inspectors from the International Monetary Fund and EU halted a review of Greece on Sept. 1.

‘Large Numbers’

While strikes and protests are common in Greece, the timing of the latest confrontation may cause investors to take notice, said Antonio Garcia Pascual, the chief southern European economist at Barclays Capital in London.

“It’s important to understand the degree of participation in these strikes,” he said in a telephone interview yesterday. “If it’s a massive demonstration with really large numbers, then surely investors will take note of that.”

Air traffic controllers and employees at the Hellenic Civil Aviation Authority are on strike for 24 hours today, the first all-day work stoppage for aviation workers this year.

General Strike

The General Confederation of Labor, or GSEE, the country’s largest private sector union that represents workers at state- run companies and utilities, is participating in the walkout and called a general strike for Oct. 19.

Greece’s average unemployment rate is expected to climb to 16.4 percent next year from 15.2 percent in 2011, according to ministry forecasts. Germany’s jobless rate was 6.9 percent in September. The economy contracted 4.5 percent in 2010 and will shrink 5.5 percent this year, Finance Ministry forecasts show.

“We have taken decisions as a government and as a parliament but as a society we have not taken a clear decision,” Venizelos said yesterday. “Unfortunately our society, our country, is hostage to great contradictions.”

Employees at Hellenic Railways Organization, Greece’s state-run rail company, and the suburban rail network surrounding Athens are also taking part. Dockworkers, journalists, health-care and municipal workers have also joined the strike.

Europe’s financial leaders are fighting on multiple fronts, trying to repair Greece’s economy while insulating Italy and Spain and shoring up banks that the IMF says face as much as 300 billion euros in credit risks.

Ministers are considering reshaping a July 21 agreement that foresaw investors contributing 50 billion euros to a second rescue package totaling 159 billion euros. The original accord calls for debt exchanges and rollovers, with private investors facing losses of 21 percent, according to the International Institute of Finance.

© Copyright 2022 Bloomberg News. All rights reserved.

Greeks walked off their jobs across the nation and as many as 20,000 marched through Athens central square to protest Prime Minister George Papandreou s 6.6 billion-euro ($8.7 billion) austerity plan, challenging a government seeking European bailout funds to stave off...
Wednesday, 05 October 2011 10:13 AM
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