Greece faces anti-austerity shutdown as EU meets

ATHENS Wed Oct 17, 2012 6:09pm EDT

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ATHENS (Reuters) - Greek workers will walk off the job for the second time in three weeks on Thursday, hoping to show EU leaders meeting in Brussels that a new wave of wage and pension cuts will only worsen the plight of a people worn down by five years of recession.

Mired in its worst downturn since World War Two, Greece is preparing 11.5 billion euros of cuts to satisfy the "troika" of the European Commission, European Central Bank and IMF, and secure the next installment of its 130-billion-euro bailout.

"Just once, the government ought to reject the troika's absurd demands," said Yannis Panagopoulos, head of the GSEE private sector union, one of two major unions that represent about 2 million people, or half of Greece's workforce.

"Agreeing to catastrophic measures means driving society to despair and the consequences as well as the protests will then be indefinite," he said.

European Union leaders will try to bridge their differences over plans for a banking union at their two-day summit which starts on Thursday but no substantial decisions are expected, reviving concerns about complacency in tackling the debt crisis which exploded three years ago in Greece.

Greek unions plan to bring much of the near-bankrupt country to a standstill over the cuts, which also include a further drastic reduction in welfare and health spending.

Most business and public sector activity is expected to grind to a halt during the 24-hour strike called by the ADEDY and GSEE unions, with newspaper kiosk owners and air traffic controllers among various groups joining the protest.

Ships will stay in port, Athens public transport will be disrupted and hospitals will work on emergency staff, while public offices, ministries and shops including bakeries will all be shut.

Several marches are expected to culminate in demonstrations outside parliament, which in the past have ended in clashes between police and protesters. Police put up metal fences outside parliament on the central Syntagma square and about 4,000 policemen are expected to be deployed on the streets.

Opinion polls show rising anger with the bailout which is keeping the economy afloat as Greeks become increasingly pessimistic about their country's future.

"The new, painful package should not be passed," the ADEDY public sector union said in a statement. "The new demands will only finish off what's left of our labor, pension and social rights."

But with Greece due to run out of money next month, Athens has little choice but to push through the austerity package being discussed with lenders despite the public opposition.

Greece and inspectors from the troika both say they have agreed on most issues, and Athens is expected to secure aid needed to avoid bankruptcy given EU determination to avoid fresh market turmoil that is threatening to drag down bigger economies such as Spain and Italy.

(Additional reporting by Tatiana Fragou; Editing by Deepa Babington and David Stamp)

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