Greeks strike against IMF/EU austerity before crucial vote
(Reuters) - Striking Greek workers denounced a new wave of austerity on Friday as a demand too far by the IMF and EU, but Finance Minister Evangelos Venizelos told the nation it had to decide within days whether to take the pain and stay in the euro or not.
Police fired teargas as black-masked protesters threw petrol bombs, stones and bottles in central Athens. The biggest police trade union said it would issue arrest warrants for Greece's international lenders for subverting democracy, and refused to "fight against our brothers."
As public rage seethed, the leader of the far-right LOAS party, the smallest of three parties backing Prime Minister Lucas Papademos, said he could not support the harsh austerity program.
"I explained to the other political leaders that I cannot vote for this loan agreement," LAOS leader George Karatzaferis told a news conference.
His party has 15 deputies in the 300-seat parliament, dominated by the socialist PASOK and conservative New Democracy parties, which both support the Papademos government.
Finance ministry staff, who must implement a new wave of job, pay and pension cuts, waved black flags as emotions in a nation suffering a fifth year of recession neared boiling point.
Venizelos made clear Greece has little choice but to accept the harsh conditions attached to a 130 billion euro bailout, and a plan to reduce its huge debt burden, to avoid a chaotic default when big debt repayments come due next month.
With a parliamentary vote on the deeply unpopular austerity package due on Sunday or Monday, he said Greece had to decide by next week whether it wanted to take the pain and stay in the euro zone, or face much greater hardship on its own.
"It's time for us to make up our minds," he said in Brussels after euro zone finance ministers refused to give immediate approval to the bailout plan. "Unfortunately, we have to choose between sacrifices and even bigger sacrifices."
Suspicious Eurogroup ministers gave Athens six days to prove its commitment by passing key legislation, finding an extra 325 million euros in savings, and providing assurances that the program will remain in force after the election.
The euro and European shares fell, reflecting concern over a possible failure of the debt restructuring.
The plan include lowering the minimum wage by 22 percent, axing 150,000 public sector jobs and reducing pensions.
Protesters joining a 48-hour strike drew parallels between Greece's current plight, where it faces bankruptcy unless it accedes to the demands of international lenders, and its seven years under military dictatorship.
On Syntagma Square in central Athens, songs from the struggle in the 1960s and 1970 against a junta of colonels boomed out over loudspeakers. Police said two officer were injured and three protesters arrested.
With Greece probably at its lowest ebb since the junta was overthrown in 1974 and democracy restored, protesters denounced the "troika" of lenders - the European Commission, European Central Bank and International Monetary Fund.
"Do not bow your heads! Resist!" They chanted. "No to layoffs! No to salary cuts! No to pension cuts!
Even the police, who have repeatedly clashed with protesters since the crisis broke out more than two years ago, announced their resistance to the troika's demands.
"As we can see you are continuing this destructive policy, so we warn you that you cannot make us fight against our brothers," the largest police trade union, the Greek Police Federation, said in an open letter to the troika.
"We warn you that as legal representatives of the Greek police, we will issue arrest warrants for a series of legal violations ... such as blackmail, covert abolition or erosion of democracy and national sovereignty."
On Thursday, Papademos announced that the three parties in his coalition government had agreed to the austerity and reform package, even though they face the rage of voters in elections possibly as early as April.
However, Venizelos failed to persuade his euro zone peers to approve immediately the deal and an accompanying bond swap, which will cut the value of the debt held by Greece's private creditors by about 70 percent.
A FINAL CHOICE
The EU and IMF have been exasperated by a series of broken promises and weeks of disagreement over the terms of the bailout, which would be Greece's second since 2010, with time running out to avoid a default.
Summing up their mistrust, Jean-Claude Juncker, chairman of euro zone finance ministers, said: "In short, no disbursement before implementation."
Venizelos made clear that the fate of the package and the PSI (Private Sector Involvement) bond swap depended on what Greece decided between now and the next Eurogroup meeting.
"Until the next Eurogroup which will most likely convene on Wednesday, our country, our people should think and make a final strategic choice," he said.
"If we see the future of our country within euro zone, within Europe, we should do what we have to do for the program to be approved and for the PSI to be concluded on time before major bonds expire in March."
Resistance is growing among nervous lawmakers who must face the electorate shortly.
The socialist deputy labor minister resigned in protest on Thursday while about 35 socialist deputies called for measures to ease the effects of the new austerity.
According to Athens News Agency, socialist lawmaker Pavlos Stasinos resigned on Friday and news websites reported that another deputy was threatening to quit. However, only mass defections would sink the package in parliament.
"There will most likely be a string of defections and abstentions but I don't believe that the measures will fall short of the majority required," political analyst George Sefertzis told Reuters. "Voting for them will be painful for MPs, but assuming responsibility for a bankruptcy would be as onerous, if not more so."
In Friday's strike, ships were stuck in Piraeus port and public transport halted. Hospital doctors and bank employees also walked off the job. Flights were not affected by the strike, an airport official said.
"The measures included in the new (EU/IMF) memorandum and which the three political leaders agreed with the government and the troika are the 'tombstone' of the Greek society," the civil servants' union ADEDY said in statement. "It's time for the people to speak up."
ADEDY and its private sector sister GSEE represent about two million workers, or roughly half the country's workforce.
The two unions, which have staged repeated strikes since the country first resorted to a bailout from foreign lenders, have called for protesters to rally in front of parliament.
(Additional reporting by Angeliki Koutantou and Tatiana Fragou in Athens, Stephen Brown in Berlin; Writing by Ingrid Melander and David Stamp; Editing by)