Greece - European Union - IMF

Greek workers strike as eurogloom spreads


Airports were at a standstill, only emergency staff were on duty at hospitals and schools were closed in Greece Wednesday as hundreds of thousands of public-sector workers staged a one-day strike against new austerity measures.


About 20,000 joined protests, organised by the Adedy and GSEE union federations, in Athens with police using tear gas to clear some of them from the central Syntagma Sqaure opposite parliament.

Dossier: Eurozone in crisis

Civil servants are opposing a plan to put some 30,000 employees on labour reserve, with reducd pay for a year while they look for new jobs.

The government’s new austerity package includes property taxes, wage cuts and layoffs.

Auditors from the European Union, the International Monetary Fund (IMF) and the European Central Bank, who are currently in Athens, demanded that private-sector collective labour agreements earlier this week.

German Chancellor Angela Merkel was expected in Brussels Wednesday for talks at the European Commission after eurozone ministers failed to agree on when or whether to dish out the next tranche of the Greek bailout plan.

IMF Europe director Antonio Borges, also in Brussels, declared that the fund is “confident” that negotiations in Athens will allow the release of the eight billion euros currently blocked.

And European commissioner Olli Rehn indicated that EU-wide moves to recapitalise banks were being planned.

European markets picked up after plummeting Tuesday on the news that France and Belgium had to save Dexia bank and Standard & Poor’s had downgraded Italy, although Tokyo and Seoul continued to slide.

Dexia account-holders withdrew 300 million euros when news of the bank’s problems broke.

Recession in Europe “can’t be ruled out”, Borges said Wednesday, presenting the IMF’s economic outlook for the eurozone, although it still predicts 1.1 per cent growth.

The IMF is recommending moving away from austerity drives and taking up stimulus packages.

Standard & Poor’s revised its eurozone growth predictions downwards from 1.8 per cent to 1.1 per cent and said there was a 40 per cent chance of recession.

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