Portugal union leader wants debt renegotiation

LISBON (Reuters) - Portugal must renegotiate its debts rather than impose harsh austerity measures to overcome its economic crisis, the head of the country's largest trade union said on Wednesday, threatening to step up strikes if the government pushed on with cuts.

Armenio Carlos, head of the CGTP union, told Reuters Portuguese workers would take a stand against attacks on labor rights, which he said were part of the government's sweeping economic reforms promised under a 78 billion euro ($103.29 billion) bailout.

"What we defend is the renegotiation of debts, in terms of deadlines, in terms of interest and in terms of the amount," Carlos said in an interview, adding that the country's bailout had made it impossible to meet its obligations.

Portugal's debt currently equals about 105 percent of gross domestic product.

"We are being confronted with a neo-liberal attack on workers' rights," he added, saying the government's recent labor reform, making it easier to hire and fire, could spark a growing wave of protests.

The union leader, a former electrician and an ex-Communist lawmaker who took over as head of the CGTP a week ago, warned that with the austerity policies demanded by the bailout, Portugal was heading down the same road to ruin as Greece.

GREECE EXAMPLE TO OTHERS

"If the results in Greece were disastrous, without a doubt they will be no different here," said Carlos, speaking at the CGTP's headquarters in the heart of Lisbon.

"The Greeks have been a heroic example of resistance and sacrifice to successive austerity packages that are leading Greece to destruction."

Portugal's debt crisis has so far failed to provoke the scale of labor protests seen in Greece. There have been two general strikes in the past two years and workers in transport and other sectors have staged regular stoppages.

But analysts say there could be more unrest as some of the government's most stringent austerity measures come into effect this year. Tax hikes and cuts, including the elimination of two months' of civil servants' wages, have already sent the country into its deepest recession since the 1970s.

"Stepping up levels of protest is inevitable," said Carlos. "We are at a crossroads. Either we surrender or we fight."

"Our people already proved ... through our history that the various times we were occupied, we did not surrender. We always responded by defending our sovereignty," he said. "It is Mrs. Merkel, in this case Germany, that is deciding things."

But Carlos faces challenges, not least that the country's second largest union - the UGT - broke ranks with his group and signed an agreement with the government and employers on labor market reform.

The head of the UGT, which represents 520,000 workers, said at the time that signing the accord would significantly decrease the likelihood of social strife spiraling out of control in Portugal.

Carlos, whose union represents 700,000 workers, said the agreement was an "attempt to subvert the constitution," by allowing companies to fire workers too easily. Portugal's 1974 constitution safeguards the right to work.

"This package is an instrument for exploration of workers," he said.

Carlos urged European unions to step up joint action.

"What is happening in Europe is an offence against the same people, workers and their families," he said. "It is necessary for the European Trade Union Confederation to intensify not only its actions of solidarity but also joint actions in the fight." ($1 = 0.7552 euros)

(Additional reporting by Patricia Rua; Editing by Andrew Heavens)