Greek trade union leaders call for strike

ATHENS: Greeek trade union leaders called a general strike today, as embattled Greek Prime Minister Lucas Papademos faced growing pressure from EU leaders to adopt tough new austerity measures.

A key meeting with heads of the Greek socialist, conservative and far-right  parties that form Papademos’ unwieldy coalition was also expected to take place  today, after the leaders failed to hold talks on Monday.
  

Greek Finance Minister Evangelos Venizelos blamed the political parties for  the failure to reach consensus on debt negotiations with the country’s EU-IMF  creditors.
  

“Instead of looking at this tragic dilemma... with national unity... there  are many who spend their effort on a conventional, outdated, party  confrontation as if nothing has happened,” the minister said.
  

Around 5,000 people took part in protests called by the unions and  left-wing parties late Monday against the austerity measures, despite Athens  being hit by a torrential thunderstorm and strong winds.
  

“It is a pretence that the measures are taken to forestall bankruptcy,”  Communist party leader Aleka Papariga told the gathering.
  

“On the contrary, they will lead the people to misery to benefit the  plutocracy and capital,” she said.
  

The country’s two main unions called a 24-hour general strike for Tuesday  to protest the new measures.
  

The measures are a death sentence for the country, aimed at slashing  salaries by 20-30 percent on top of previously imposed cuts, said Yiannis  Panagopoulos, leader of the GSEE private-sector union.
  

Papademos, being pulled one way by his EU partners and the other by  domestic sentiment, was due to meet officials from the EU, European Central  Bank (ECB) and International Monetary Fund (IMF) again on Monday evening.
  

Those talks are aimed at wrapping up weeks of negotiations and saving his  country from a historic default in March that could roil the 17-nation eurozone  and undercut a global economic recovery.
  

A new eurozone package worth 130 billion euros ($170 billion) in aid to  Greece, pending since October, hangs in the balance.
  

In Washington. the IMF’s chief economist insisted that Greece must cut  wages to boost competitiveness and pull the country out of its economic  quagmire.
  

“Either you basically increase productivity growth a lot and quickly, and  you keep wage growth moderate, or you decrease wages,” said Olivier Blanchard.
  

In Paris, German Chancellor Angela Merkel and French President Nicolas  Sarkozy ramped up the pressure on Athens.
  

Merkel warned that Greece would receive no more EU aid to cope with the  debt crisis until Athens reaches a deal with the EU, ECB and IMF ’troika’ on  more spending cuts and reforms.
  

The two leaders also floated the idea of placing part of Greece’s future  bailout loan funds in a special account to make sure it is channelled to  service the country’s enormous debt, currently exceeding 350 billion euros, and  not for other uses.
  

“The Greeks gave us undertakings,” Sarkozy added. “They should respect them  scrupulously. There’s no choice.”    A spokesman for EU commissioner Olli Rehn warned that Greece had already in  effect missed the deadline to get the deal done by the coalition to reshape the  economy and slash its debt in exchange for another bailout. But an EU diplomatic source suggested all was not lost.
  

“We haven’t lost all hope, we hope that between now and Wednesday evening,  the negotiations will be wrapped up,” the source told AFP, referring to public  spending, as the massive write-down of privately-held debt appears all-but  settled.
  

Grouped within the Institute of International Finance (IIF), negotiators  representing banks, insurance companies and private institutional investors  held talks on Sunday on cutting some 100 billion euros from the roughly 200  billion in Greek government debt they hold.
  

The EU source said that eurozone finance ministers have been asked to be on  standby again for talks, probably via teleconference late Wednesday or Thursday.
  

Papademos on Sunday managed to get limited agreement with his coalition  partners on a state savings target of 1.5 percent of gross domestic product  (GDP) that would include the implementation of reforms to lower production  costs and a scheme to recapitalise Greek banks.
  

And Administrative Reform Minister Dimitris Reppas confirmed that 15,000  civil service jobs would be axed this year as requested by EU-IMF creditors.
  

Greece must pay 14.5 billion euros in bonds due March 20 to avoid default.
  

Athens and its private creditors are under intense pressure from the “troika” to cut the country’s total debt burden down to what is seen as a  sustainable level of 120 percent of GDP in 2020 from 160 percent at present. -- AFP