Anti-austerity protests are paralyzing Greece

 Reuters

Renee Maltezou and Lefteris Papadimas, Reuters

Feb. 4, 2016, 10:07 AM          3,123  3

ATHENS — Scuffles broke out and the police used teargas during a mass rally in Athens on Thursday as Greeks railed against government pension reforms needed to meet demands of international creditors.

Demanding an end to austerity, about 50,000 Greeks marched on Parliament in central Athens. Breaking away from the main block of demonstrators, black-clad youths hurled stones and petrol bombs at police officers, who responded with rounds of teargas and stun grenades, Reuters witnesses said.

The angry backlash is piling pressure on Prime Minister Alexis Tsipras, first elected just over a year ago. With just a three-seat majority in Parliament, he is stuck between either pushing the reforms through to appease international creditors, or attracting the wrath of thousands of Greeks.

"They should be strung up here, in Syntagma Square," pensioner Nikos Ghinis said as he walked along with thousands of others in central Athens. "I'm getting 740 euros ($826.21) a month for 40 years of work ... I'm (demonstrating) here for my children and grandchildren," he told Reuters.

Dozens of domestic flights were grounded, ferries remained docked in ports, and most public transport was paralyzed as part of the strike organized by Greece's main labor unions, the private-sector union GSEE, and the public-sector union Adedy.

It was the second nationwide walkout since Tsipras took power in January 2015 on a pledge to end years of austerity, only to cave in under the threat of expulsion from the eurozone and sign up to new belt-tightening reforms under an EU-IMF bailout package worth up to 86 billion euros.

The 24-hour strike coincides with a major review of Greece's performance on terms of its bailout. The heads of the European Union and the International Monetary Fund mission assessing Greece's progress arrived in Athens earlier this week to discuss the pension plan, tax reforms, and bad loans weighing on Greek banks.

The government wants to conclude the review swiftly to start talks on debt relief and convince Greeks that their sacrifices are paying off despite the jobless rate rising to 25%.

Greece must cut pension spending by 1% of gross domestic product, or 1.8 billion euros, this year. To protect retired people whose pensions have been slashed 11 times already since 2010, the government plans to increase social-security contributions by employees and employers.

But unions say the new plan will increase unemployment as the costs for hard-pressed businesses will go up and will force workers, mainly the self-employed, into tax evasion as it links social-security contributions to declared income.

"We will reach a stage where we won't be able to make ends meet unless we steal from the state, hide income," demonstrator George Stathopoulos, 70, said.

Under the terms of pension reform, their social-security contributions will increase almost threefold in coming years.

Though the measures, which include the gradual phasing-out of a pension benefit by 2019, are broadly in line with bailout demands, sources close to the lenders said they may not be enough to address a deeper-than-expected fiscal gap.

(Editing by Jeremy Gaunt.)

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