Greece groans as spending cuts bite
Share
Greece's latest round of draconian financial measures - unveiled yesterday - has won praise from the EU, but incensed workers at home. Strikes and protests continue to shake the country as the Greek unions complain the government's economic medicine is far too bitter a pill for them to swallow.
Feelings are running high. This morning protesters from Communist workers' unions stormed the Finance Ministry building in Athens, raising a banner calling for an uprising. Greek TV reported around 60 other protests were taking place across the country and the two largest unions are calling on their 2.5 million members to take part in a 3-hour strike tomorrow.
The trigger for this latest wave of public anger is the new round of austerity measures announced by the government yesterday. Hot on the heels of spending cuts announced over the last few weeks, this new package includes cuts in public sector salaries and a 2% sales tax increase designed to save € 4.8 billion.
Prime Minister George Papandreou, who is struggling to win Greeks over to the cuts, yesterday warned his people that they must behave as though the current budget crisis were a "wartime situation".
He does, however, seem to be winning the backing of the EU, which welcomed the latest moves. The Greek government successfully issued a 10-year bond today, but is seeking support from Europe to help it borrow a further € 50 billion at more preferable rates.
Mr Papandreaou is heading to Germany and France tomorrow in the hope of getting this financial help, but a government spokesman today indicated that Greece is also contemplating turning to the International Monetary Fund for a bail out if the EU does not come through.
