Thousands demonstrate as Greece goes on strike

More than 30,000 protesters marched through Athens today as a nationwide strike against government cuts crippled the country.

The 24-hour walkout came amid reports Greece was considering tougher measures, including deeper salary cuts and drastic reforms of the civil service and pensions system, to pull itself out of financial crisis.

Chanting “Billions for the rich, but nothing for us,” demonstrators marched to parliament, as riot police maintained a discreet presence.

Demonstrations, part of the first general strike held by unions since the centre-left government’s election in October, were also held in other cities around.

The strike grounded all flights at Greek airports and left trains and ferries idle. Commuters in Athens were left without most forms of public transport. State-run schools, tax offices and local government were all closed, while public hospitals used emergency staff. Journalists also held a 24-hour strike.

The country’s two largest umbrella labour groups, the private sector GSEE and public sector ADEDY, fiercely oppose a wave of belt-tightening measures announced over the past weeks to reduce the bloated budget deficit from 12.7% of gross domestic product to 8.7% this year.

“If all these measures are enforced, unemployment will skyrocket. Our country will enter a massive recession and unemployment will reach a Europe-wide record,” a GSEE spokesman said.

“This will be tragic because it will provoke social (unrest) and clashes.”

Greek unemployment hit a five-year high of 10.6% in November 2009, up from 9.8% in October. The country’s woes have affected confidence in the euro as a common currency, and raised its borrowing costs.

The governing Socialists have frozen civil service wages and hiring while cutting bonuses, raising consumer taxes and retirement ages.

Greek borrowing rates nevertheless remained high today, reflecting market worries of a default.

Greece is facing a March 16 deadline from the European Union to show signs of financial improvement and is under pressure to take additional measures. These could include raising VAT, currently 19%, and further civil service bonus cuts.

Greece’s central bank governor George Provopoulos said the crisis heightened a pressing need for major economic reforms.

“The crisis could present an opportunity to carry out necessary reforms – and not just have a debate about them – given that not implementing these reforms would have a great price.”

The strike will be a crucial test of support for the unions, with polls showing strong public support for the government’s austerity plan.

A poll in the Ethnos newspaper showed 57.6% of Greeks believe measures taken so far are “in the right direction,” while 75.8% think unions should show restraint until the end of the crisis.