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Europe
Greeks strike amid debt crisis
Customs and finance ministry staff walkout as EU warns over debt-reduction measures.
Last Modified: 16 Feb 2010 21:19 GMT
European countries are pressuring Greece to step up its efforts to reduce its national debt [Reuters]

Greece has been hit by a fresh wave of strikes as European Union ministers put pressure on the debt-ridden nation to toughen its deficit-reduction plan.

Customs officials and finance ministry employees began a walkout on Tuesday to protest against measures taken by the government in an attempt to pull the country out of its economic crisis.

"The government measures will further cut our salaries, we have already lost 10 per cent of our income in the past two years due to wages freezes," Apostolos Papantonis, treasurer at Greece's customs employees federation, said.

Last week, civil servants walked off the job for 24 hours in protest against the government's plans to freeze wages, gather more taxes and overhaul the pensions system.

A series of further strikes are already being planned, with the country's two largest umbrella unions declaring a general strike for next Wednesday, and fuel lorry drivers threatening to strike this week.

Tuesday's action came as European finance ministers meeting in Brussels warned Greece that it would have to prepare tougher budget cuts if its current programme fails to reduce the national deficit from 12.7 per cent to 8.7 per cent this year.

'Not enough'

Anders Borg, Sweden's finance minister, described the situation as "urgent".

"What we have seen so far is not enough. We need more steps when it comes to taxes and ... expenditure, if they [Greece] want to build credibility in the market," he said.

in depth

  Blog: Greece is a crisis for all of Europe
  Video: Greeks strike over austerity plan
  Video: Greeks take break from economic woes

EU countries that use the euro currency have pledged to help Greece if it cannot repay its debts, but want Athens to make big spending cuts first.

There are fears that a Greek default could spark a wider European debt crisis and threaten other governments' ability to borrow money.

Jean-Claude Juncker, Luxembourg's finance minister, said if it is shown that Greece is not on course to meet it deficit-reduction targets then the eurozone would vote on whether tougher action was needed.

But the measures already announced by the Greek government, including higher taxes, increases to the average retirement age and a freeze in public salaries, have already been met with opposition from the public.

Tim Friend, Al Jazeera's correspondent in Brussels, the Belgian capital, said it would be important for EU ministers and Greece to strike a balance over the measures.

"The social dimension of this on the ground in Greece is enormous.

"The EU is very conscious of this and they obviously have to strike a balance between making sure the Greek economy gets back on track, but at the same time not alienating the public to such an extent that the government ... finds itself in the midst of an even deeper political crisis.

"But it's going to be very, very tricky because they're not just talking about reducing this huge deficit ... they're also talking about big structural changes to the whole of the Greek economy," he said.

Financial inquiry

Meanwhile, Greece's parliament announced it was launching an investigation to establish who was to blame for the country's financial crisis.

"We will proceed to an investigating committee on the economy to see what political decisions blew up budgets and deficits," Christos Papoutsis, the spokesman of the ruling Socialists' parliamentary group, said.

The government revealed in October that Greece's deficit and debt were far higher than reported by the country's previous administration.

"Our problem is credibility and we must regain it, at all costs," Theodoros Pangalos, the deputy prime minister, told parliament.

EU officials have accused past Greek governments of faking statistics and trying to hide the extent of the country's fiscal problems.

Source:
Al Jazeera and agencies
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