Bloomberg News

Greek Police Clash With Protesters Opposing Austerity Plans

June 15, 2011

(Updates with injuries, damage in third paragraph.)

June 15 (Bloomberg) -- Greek police used teargas to disperse protesters encircling the Parliament House in Athens as 20,000 people rallied against Prime Minister George Papandreou’s additional wage cuts and tax increases.

Police fired the teargas at demonstrators who threw fire bombs and rocks at the Finance Ministry and banged on hotel shutters. Earlier, protesters rushed police guarding the parliament as union supporters joined up with demonstrators who have been camped out in front of the building for almost three weeks. Ports, banks, hospitals and state-run companies ground to a halt today as the two biggest unions went on strike.

The situation is “calmer now” after a small group caused violence in the city center, Athanasios Kokkalakis, a police spokesman, said in live comments on state-run NET TV. Fifteen people were arrested and 66 were reported injured, including 36 police officers, according to text messages from the Health Ministry and the Athens police. Some people fainted in the square’s metro station after teargas was fired into it, NET TV said, without citing anyone. Damage was reported in two stores, two banks and a hotel, according to the police.

ADEDY, the largest public-sector union, and the General Confederation of Labor, or GSEE, the biggest private-sector union, called the third general strike of the year to protest the government’s five-year fiscal plan and state asset sales, a 78 billion-euro ($111 billion) package required to continue receiving funding under a European Union-led bailout plan to avert default.

Unity Government

Papandreou offered to step aside to permit the formation of a unity government, as long as all opposition parties agreed to the cuts, said a person with direct knowledge of the matter. That countered a demand by the New Democracy opposition party that he quit and allow a so-called technical government to renegotiate the terms of the rescue.

“Each must assume their responsibilities to the people and the country,” Papandreou told Greek President Karolos Papoulias today. “We will proceed with imperative decisions.” Papandreou said he is in touch with the leaders of parliamentary parties and seeks national agreement.

The prime minister is facing growing dissent within his Socialist Pasok party over the measures, which will face a parliament vote this month. One Pasok lawmaker said yesterday he won’t vote for the bill and a second withdrew from the party, the To Vima newspaper reported in separate articles. Papandreou now has a five-seat majority in the 300-member assembly.

Avoiding Default

“This government has the responsibility to save the country from default,” George Petalotis, a spokesman, told reporters in Athens yesterday when asked about the strikes.

A group called the People’s Assembly of Syntagma that is urging people to encircle parliament held a banner that read: “Their parliament will be their prison, we are decided.” Lawmakers today begin to debate the bill, submitted on June 9.

Demonstrators have assembled in the square in front of parliament for 21 days, setting up tents and calling on others to join them. Police said the largest rally was on June 5, when 50,000 people gathered.

Separately, protesters in Barcelona, Spain, tried to stop regional lawmakers from entering the state assembly building today to pass a budget bill that aims to slash spending 10 percent this year. An official at the Catalan police force declined to give details on the number of people arrested after demonstrators clashed with police.

Deadlock Remains

Papandreou’s budget measures, which include higher taxes and lower public-sector wages, aim to get more aid after a 110 billion-euro bailout approved last year failed to secure market access for Greek bonds in 2012.

An emergency session of euro-region finance chiefs in Brussels yesterday failed to break a deadlock on how to enroll investors in a second bailout without triggering a default, casting doubt on funds due from the International Monetary Fund next month.

The Athens stock exchange fell today, with the benchmark ASE Index dropping 1.9 percent to 1,243.05 at 5:19 p.m. National Bank of Greece SA, the biggest lender, lost 6 percent to 4.57 euros.

Public-sector workers, hospital employees, bank workers, and police officers are participating in the 24-hour strike. Ferry operations are disrupted and public transport interrupted. Journalists lifted a planned media blackout.

Unions oppose Pasok’s plans to sell stakes in state-owned companies such as Public Power Corp SA. The GENOP union, which represents workers at the company, said it will hold 48-hour rolling strikes from June 20 until the government backs down and today occupied Public Power’s headquarters, according to the state-run Athens News Agency.

“We demand withdrawal of the harsh and unjust measures being imposed by the government as it has been commanded to do by our lenders,” GSEE said in an e-mail.

--With assistance from Maria Petrakis in Athens and Emma Ross- Thomas in Madrid. Editors: Eddie Buckle, Ben Livesey

To contact the reporters on this story: Eleni Chrepa in Athens at echrepa@bloomberg.net; Natalie Weeks in Athens at nweeks2@bloomberg.net

To contact the editor responsible for this story: Angela Cullen at acullen8@bloomberg.net


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