Street protests as Greek deputies consider budget vote

AFP, Sunday 11 Nov 2012

Thousands of protesters massed outside Greece's parliament Sunday as lawmakers prepared to vote on a 2013 budget that includes draconian cuts but needs to pass for vital foreign aid to be released.

Police estimated around 15,000 marchers joined two separate marches in the capital Athens.

"The measures will pass but we are here to prove that we are not resigned to it," said Olga P., 35, an English teacher in a public school.

The parliamentary vote, due to take place late Sunday or early Monday is the latest hurdle the government needs to clear in its bid to head off bankruptcy in the debt-crippled country.

The proposed budget includes another 9.4 billion euros ($12 billion) in cuts and paints a gloomy outlook for the country's economy and government finances.

But Finance Minister Yannis Stournaras, while acknowledging the sacrifices already endured by Greeks, told parliament on Saturday that 2013 would be crucial for the country's economy.

This latest vote comes just days after parliament narrowly adopted a separate austerity package on Wednesday.

The austerity regime imposed on Greece, which has included massive cuts to public-sector wages and pensions, has triggered a series of general strikes.

Street protests in major cities have frequently turned violent.

Sunday's protest was called by both the public-sector Adedy union and the private-sector GSEE union.

A GSEE statement called urged to reject the austerity policies.

A banner from the opposition radical left-wing Syriza party called for the government's downfall.

But Stournaras has appealed to MPs to support the budget to ensure Greece stays in the euro.

The country is currently surviving on two massive bailouts from its international creditors.

The budget must pass if Greece is to have any chance of unlocking a 31.5 billion euro ($40 billion) tranche of bailout funds from its three international creditors -- the European Union, the International Monetary Fund and the European Central Bank.

The vote also comes on the eve of a eurozone finance ministers meeting, during which Athens' progress on carrying out required reforms and cuts would be scrutinised.

Without the fresh funds, Greece risks default on November 16, when the government -- in the midst of its biggest crisis since taking office in June -- must repay a three-month treasury bill worth five billion euros.

German Finance Minister Wolfgang Schaeuble said in an interview with Sunday's Die Welt newspaper that the ball was in Greece's court even after lawmakers approved the latest 18.5 billion euro austerity package demanded by creditors.

"Nobody in the eurozone opposes the idea of accepting the payment of the next tranche of aid," he added.

"But only when the conditions have been met. And that, that is for the government in Athens to take care of."

The 2013 budget predicts the economy will shrink by a worse-than-expected 4.5 percent next year, the sixth year of recession, while the public deficit -- the shortfall between government revenue and spending -- is forecast to rise to 5.2 percent of gross domestic product.

-- 'Government stability a priority' --

Deputy finance minister Christos Staikouras however said the government could for the first time in years register a primary budget surplus -- before debt servicing costs -- next year.

Public debt is expected to swell to 346 billion euros ($450 billion), a massive 189 percent of economic output, compared with a target set by creditors who want the figure slashed to 120 percent of GDP by 2020.

The 9.4 billion euros in cuts will mainly hit state wages, pensions and benefits, already drastically reduced over the past two years in a country where unemployment is now at a record level of more than 25 percent.

But the government will still need to borrow over 68 billion euros next year, the draft budget said.

The troika is due to deliver a report on the state of Greece's finances before the aid, which has been frozen since June, is paid out.

The budget is expected to pass on Sunday although Samaras's three-party coalition has lost 10 deputies since taking power in June.

The head of moderate left-wing party Dimar, Fotis Kouvelis said his party would vote in favour "so that the effort to bring about an economic recovery can continue."

Evangelos Venizelos, leader of the Socialist Pasok party, a member of the coalition, appealed for unity for the vote.

"The country is at its limits. The stability of the government must be the priority if we are to emerge from the crisis," he told the centre-left Ethnos newspaper, warning against any delay by the Europeans in deciding on the aid.

Going into Sunday's vote, Samaras's conservative New Democracy has 126 lawmakers, Pasok 27 and Dimar 16.

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