Greeks strike before budget vote
Greek unions called a general strike on Wednesday and Athens was paralysed by a 24-hour public transport stoppage in protest against the government's 2011 budget, set to pass later as part of an EU/IMF bailout. Protest amid austerity drivebusiness Updated: Dec 22, 2010 22:35 IST
Greek unions called a general strike on Wednesday and Athens was paralysed by a 24-hour public transport stoppage in protest against the government's 2011 budget, set to pass later as part of an EU/IMF bailout.
The budget, meant to help stem a debt crisis that has shaken the euro zone, includes further tax hikes and wage cuts in state-run enterprises, especially in public transport.
Fitch said on Tuesday it may cut Greece's credit rating next month to junk as both other major rating agencies have done.
"Even though this news was expected, it will go down badly with the markets, there is widespread fear about downgrades coming," said Ioanna Telioudi, analyst at HSBC in Athens.
Greece's main public and private sector labour unions have called a 3-hour strike from 1000 to 1300 GMT in Athens. Thousands are expected to rally outside parliament.
Athens bus and subway drivers have been holding on and off strikes for two weeks, keeping Christmas shoppers from the city centre, adding to the strain of recession-hit retailers.
The government threatened on Wednesday to break the public transport strikes, invoking emergency legislation it used earlier this year to dissolve labour action by truck drivers and other transport workers.
"Everyone has to show responsibility ... the state has all the powers it needs to protect the public interest," government spokesman George Petalotis said in a television interview.
Analysts have warned the additional measures will hurt the economy even more without providing guarantees that the country will avoid a debt restructuring to cope with ballooning debt.
The government has a comfortable majority of 156 seats out of 300 in parliament and the budget is expected to be approved despite growing discontent among the ruling PASOK party ranks.
"I am giving the government a last chance," said PASOK deputy Thomas Robopoulos during the budget debate on Tuesday. Since the EU/IMF bailout agreement was signed in May, Prime Minister George Papandreou has expelled four deputies for disagreeing publicly with his austerity policies.
First Published: Dec 22, 2010 22:17 IST