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Greece restless amid push for cuts

business Updated: Sep 18, 2012 23:12 IST
greece economy

Public opposition to austerity budgets deepened in Greece on Monday, with judges stopping work, doctors going on strike and public transport staff and schoolteachers planning action for later this week. The moves are a prelude to a general strike called by the country's main labour unions for September 26.

The protests are gaining steam even as Europe's fears of a Greek exit from the euro zone seem to be subsiding. On Monday, Chancellor Angela Merkel of Germany said she wanted Greece to stay in the euro union. "I think that everyone who is politically sensible will want that, too," she said.

The Greek prime minister, Antonis Samaras, renewed efforts on Monday to come up with a tough new €11.5 billion ($15 billion) austerity package. The additional cuts are needed to meet the terms of Greece's €130 billion euro bailout and to unlock a €31.5 billion loan installment that Athens hopes to receive in October to stay solvent.

Faced with rising discontent, Samaras has been asking Greece's international creditors for more time to impose any new cuts, lest the economy, which contracted by 6.2% in the second quarter, sink further.

Over the weekend, European finance ministers meeting in Cyprus seemed willing to give Greece some breathing room. Finance minister Maria Fekter of Austria said that Greece could get more time to meet its targets, but not more money.

Still, Samaras faces an uphill battle. Last week, Greece's so-called troika of lenders - the IMF, the ECB and the European Commission - rejected about €4 billion of Samaras's proposed cuts, saying in effect that they did not think he would be able to deliver. NYT