Greek coalition in last-ditch talks to finalise cuts

AFP, Thursday 27 Sep 2012

Prime Minister Antonis Samaras seeks to secure approval of leftist allies prior to presenting an extra 13.5 billion euro austerity drive to parliament

Greek
Hooded youths move towards riot police in Athens' Syntagma square during a 24-hour labour strike September 26, 2012. Greek police fired teargas at hooded youths hurling petrol bombs and stones as tens of thousands took to the streets in Greece's biggest anti-austerity demonstration in months on Wednesday (Photo:Reuters)

Greece's coalition leaders were meeting on Thursday to seal an extra 13.5-billion-euro austerity drive tied to the release of bailout loans after street protests in main cities and ongoing strikes.

Prime Minister Antonis Samaras, who has already approved the $17.5-billion package, will seek to secure the approval of his socialist and moderate leftist allies before tabling the measures to parliament next week.

According to the finance ministry, they include 11.5 billion euros ($14.8 billion) in state spending cuts and two billion euros in additional tax revenue.

Greece's so-called 'troika' of creditors -- the EU, IMF and the European Central Bank -- had given the government a week to finalise the cuts.

They are expected to return to Athens by early next week and the government hopes to have the package ready before a meeting by eurozone finance ministers on October 8.

The austerity package is designed to unblock access to 31.5 billion euros in loans, part of Greece's massive rescue package from the so-called troika of creditors -- the EU, the IMF and the European Central Bank.

Athens needs the money to pay state salaries and pensions, recapitalise Greek banks hit by a state debt rollover and repay more than six billion euros owed to private contractors.

Samaras' allies have been trying to mitigate the cuts, pointing to mounting anger in Greece after two years of austerity.

A wave of sectors from doctors and lawyers to teachers and even state security staff have staged strikes and walkouts this month against the new measures.

The protests have even hit the finance ministry, where staff were holding a two-day strike starting on Thursday against planned salary cuts.

On Wednesday, police clashed with masked youths in Athens during a general strike and demonstrations that drew some 34,000 people to the city centre.

The youths threw firebombs, smashed shop windows and set fire to garbage in the streets around central Syntagma Square.

Another 18,000 people protested in the northern city of Thessaloniki according to police.

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