Emergency lenders give Greece 3-month extension for staff cuts, strikes intensify

  • Article by: DEREK GATOPOULOS
  • Updated: July 9, 2013 - 2:35 PM

ATHENS, Greece — Officials in Greece announced the first details of major staff cuts for its bloated public sector Tuesday, sparking anger among unions who pledged to extend strikes and occupy city halls across the country.

Euro area finance ministers late Monday approved Greece loan installments worth 6.8 billion euros ($8.7 billion), despite the conservative-led government missing a deadline to place 12,500 workers in program that subjects them to involuntary transfers within the public sector.

Greece has also promised to ax a further 15,000 jobs by the end of next year. On Tuesday, the government said it had been given three months by rescue lenders to catch up, and announced it was placing 4,200 workers — including school guards and elementary school teachers — on an eight-month suspension with reduced pay before the end of July.

The announcement marked a shift in Greece's grueling austerity program which has relied heavily on pay cuts and tax hikes to try to balance its budget. This has hammered the private sector and dragged the country into a sixth year of recession.

In response to the latest measures, a local government workers' union said it would extend rolling 24-hour strikes for the rest of the week.

"We are recommending that our members continue their protest campaign, with the occupation of municipal buildings," Themis Balasopoulos, leader of the protesting POE-OTA union, told the AP. "We actually have shortages in local government, but we are the main target for cuts because our elected officials are offering no resistance to the government."

Up to 3,000 striking municipal workers, many wearing fluorescent vests, marched through the streets of central Athens in their second day of demonstrations.

Greece has been dependent on billions of euros in rescue loans from other European countries that use the shared currency and from the International Monetary Fund since 2010, when the country found itself unable to borrow money on the international bond market.

Left-wing opposition leader Alexis Tsipras said the staff cuts were the latest indication that the bailout program — supervised by the "troika" of the IMF, European Union and European Central Bank — had failed.

"The technocrat-terrorists from the troika come here and demand firings, as if they are counting beans and not human beings," Tsipras told factory workers in central Greece.

"They are the gurus of disaster. Having admitted that the program is a failure, they have the audacity to demand more (austerity) measures."

Also Tuesday, the government raised 1.63 billion ($2.1 billion) euros in a six-month treasury bill auction, with a 4.2 percent yield unchanged from a month ago. Shares closed 2.34 percent lower on the Athens Stock Exchange while international markets were broadly positive.

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