UPDATE 1-Portuguese stage general strike against relentless austerity

Thu Jun 27, 2013 4:00am EDT

* Public transport halts, private sector hit little

* Many workers cannot afford to lose day's pay

* Government unlikely to drop austerity policies

* Rise in debt yields overshadows bailout exit plan

By Axel Bugge and Andrei Khalip

LISBON, June 27 (Reuters) - Portuguese trade unions staged a one-day general strike on Thursday against relentless austerity which has deepened the worst economic slump since the 1970s, but support outside the public transport sector was patchy and the government seemed unlikely to back down.

Previous strikes and protests about the tough terms of Portugal's 78 billion euro ($100 billion) bailout by the European Union and IMF in 2011 have been largely non-violent, unlike unrest in Greece or more recently Brazil and Turkey.

Thursday's action also got off to a peaceful start. Nevertheless, public transport came to a virtual standstill as Portuguese, some too hard up to join the strike, expressed their anger and despair about policies which have helped to push unemployment to record levels.

"It's simple - if I don't work, I don't eat. The government disgusts me, the austerity is stifling us, but protesting won't feed my family," said Augusto Nery, a 53-year-old electrician.

Unions hope the fourth general strike in two years will force the government to boost economic growth and ease the belt-tightening including the sharpest tax increases in living memory this year.

Trains were not running, while metro and ferry services halted in Lisbon. Many bus routes were suspended, forcing those who chose to go to work into longer, alternative journeys that were served by fewer buses than usual.

Refuse removal was stopped in many cities and towns, town halls were shut and the fishing fleet in the southern Algarve region stayed in port. The state-owned airline TAP has warned of possible disruption but not cancelled any flights so far.

The CGTP and UGT unions leading the strike altogether have more than 1 million members.

But many private sector employees turned up for work with restaurants and shops open as usual. Workers' families often cannot afford to lose a day's pay in the third year of the recession, especially with unemployment near 18 percent.

"These austerity policies punish the country, violate the people, penalise workers and pensioners, so the strike will be a cry of resistance to these policies," said Carlos Silva, leader of the 500,000-strong UGT union, acknowledging that "the private sector always has fewer conditions to join the strike".

With the hottest weather so far this year affecting Portugal this week, many young people may prefer to go to the beach rather than take part in protests planned for later in the day.

"Given the level of public discontent with the coalition, the demonstrations will generate considerable noise. Yet, the protests will probably not affect the government's stance," said Antonio Barroso, a London-based political analyst at advisory firm Teneo Intelligence, in a research note.

The centre-right coalition government holds a comfortable majority in parliament and there is no indication it will change course from its goal of ending the bailout deal by mid-2014.

However, Portugal still faces increasing financial problems, with yields on its government debt rising sharply in recent weeks, overshadowing the plan to resume financing its budget deficit fully by borrowing on debt markets.

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