April 22, 2010 / 7:44 AM / 9 years ago

Greek workers strike, challenge EU/IMF talks

ATHENS (Reuters) - Greek public sector workers walked off the job on Thursday to protest against austerity measures and press the government not to agree to further cuts as it discusses an aid package with the EU and IMF.

A man walks by a branch of a bank with graffiti reading "Fire to the banks" during a rally against government's austerity measures in Athens April 22, 2010. REUTERS/John Kolesidis

Doctors, nurses, teachers, tax officials and dockers stopped work, paralyzing public services, while thousands are expected to march to parliament at midday as European and IMF officials meet for the second day of talks that could lead to a financial bailout for Greece.

Workers are protesting public wage cuts, a pensions freeze and tax hikes imposed by the government to try to pull Greece out of a fiscal crisis that has shaken markets worldwide and driven Greece’s borrowing costs to a 12-year high.

“These bloodthirsty measures won’t help Greece exit the crisis. A tragic period begins,” said Ilias Iliopoulos, secretary general of public sector union ADEDY, which represents half a million workers.

Many in Greece fear strings attached to the 40-45 billion euro ($53.8 to 60.5 billion) aid package, if the cash-strapped nation decides to tap it, will hit living standards in a country where one person in five lives below the poverty threshold, according to EU data.

“We won’t tolerate any more measures because we cannot make ends meet. I have a mortgage, two children, I have cut down on every luxury,” said 38-year old civil servant Pavlina Parteniou. “Why don’t they catch those who stole the money? Is my salary or my mother’s pension of 300 euros going to save the country?”

Parteniou said she agreed with the strike but would not take part because she could not afford to lose a day’s pay.

The socialist government, pressured by markets and EU policymakers to tidy up its finances, has vowed to go ahead with reforms but Finance Minister George Papaconstantinou said on Wednesday no more austerity measures would take place this year.

AID PACKAGE

Newspaper editorials showed little sympathy for the strike, saying the government had no choice but to enact austerity measures and tap the aid package after the yield on Greece’s 10-year bond jumped to 8.4 percent on Wednesday.

“We have to find the money somewhere because the civil servants that are striking today will have to be paid at the end of the month,” center-left daily Ethnos wrote in an editorial.

Investors and policymakers are closely watching the protest — the fourth nationwide strike organized by the public sector union this year — as concerns grow over whether Greece will honor its plan to slash its double-digit budget deficit to under 3 percent of Gross Domestic Product in 2012.

Opposition to the measures has so far been relatively muted, although polls show most Greeks oppose them. Violence has been much less frequent than in 2008 riots that paralyzed Athens for weeks after the police killing of a teenager.

Worries about the recession and a surge in unemployment highlight the delicate balance Athens needs to strike in meeting international demands for cutbacks while maintaining enough support at home to ensure it can implement the reforms.

On Wednesday, the IMF said unemployment would rise to 13 percent in 2011, and Greece would be the only euro zone country to see its economy contract next year with a 1.1 percent drop.

Air traffic controllers have decided not to strike on Thursday, saying they did not want to further burden travelers and aggravate flight disruptions caused by the cloud of volcanic ash that caused havoc this week across Europe.

Additional reporting by Harry Papachristou; Writing by Ingrid Melander; Editing by Mark Trevelyan

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