Greece: unions riot at spending cuts -picture of US future?

April 30, 2010 05:46

Police fired tear gas to disperse the crowd as the unrest flared over austerity measures that may be taken in return for a massive bailout deal.

via BBC

The European Union (EU) has said it is close to aproving the details of an emergency plan to help tackle Greece’s crippling debt.

EU commission chief Jose Manuel Barroso said “rapid progress” was being made.

“I’m confident that the talks will be concluded soon, meaning in the next days,” Mr Barroso told a news conference following the clashes.

“We believe that these solutions will be conducive to our actions and will prevent further possible effects of the contagion.”

Officials from the EU, the International Monetary Fund, and European Central Bank are in Athens to negotiate the bailout.

The Greek government says it needs a deal by 19 May to avoid a devastating debt default.

‘Measures of destruction’

Police fired tear gas at hundreds of demonstrators, after some tried to break through a police cordon guarding the Greek finance ministry.

The outbreaks came after Greece began talks over extra budget cuts as conditions for the bailout loans.

These cuts would be in addition to an already mooted austerity drive aimed at reducing the nation’s public deficit, which is more than four times bigger than the EU limit.

We are holding tough negotiations to protect what we can for the weak and the middle class in our country
Greek Prime Minister George Papandreou

Union officials say the IMF wants Athens to raise sales taxes, scrap bonuses amounting to two extra months of pay in the public sector and accept a three-year pay freeze.

The union officials also claim that by next year, the IMF and the EU want Greece to shed 10 percentage points from the public deficit that reached 13.6% of output in 2009.

In addition, they say Athens has been asked to get rid of 13th and 14th month bonuses for public sector workers and pensioners.


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