Greece hit by anti-austerity general strike

ATHENS (AFP) – A nationwide general strike gripped Greece on Wednesday in the first major test of the socialist government's resolve to push through unprecedented austerity cuts needed to avert fiscal meltdown.

Protest fever swept over the country with public transport paralysed, ferries not leaving the docks and air traffic grounded as unions went on the warpath against the latest wave of spending cuts and tax hikes.

A teacher carries a banner reading: 'Education for sale' during a protest front of the Greek Parliament in Athens on May 4. AFP photo

Hundreds of thousands of civil servants kicked off the protests on Tuesday and a group of about 200 communists also stormed Athens Acropolis, unfurling banners reading "Peoples of Europe, Rise Up."

Wednesday's walkout, the third general strike in as many months, comes as the government races to push the austerity drive through parliament, looking to its comfortable majority there to pass the package on Thursday.

Greece's main unions were to mass in central Athens at 11:00 am (0800 GMT) before moving through the streets of the capital in protest marches.

May Day marches on Saturday led to clashes between anarchists and police who fired tear gas to restore order.

Pushed to the brink of default, the government agreed at the weekend to slash spending and jack up taxes in return for 110 billion euros (143 billion dollars) in loans over three years from eurozone countries and the International Monetary Fund.

Among the major measures, the government is to cut 13th and 14th month bonus pay for civil servants and retirees; require three years more for pension contributions; and raise the retirement age for women to 65, the same level as men currently.

"Given the scale of the public opposition to the austerity measures it is still unclear whether Greece will ultimately be willing to take years of fiscal punishment and recession to get its fiscal house in order," economist Ben May at consultants Capital Economics said.

"Accordingly, it is still unwise to rule out the government eventually defaulting or restructuring its debts," he added.

Financial markets fell sharply Tuesday on fears the EU-IMF bailout package for Greece might not be enough to stop the crisis spreading to other weak eurozone economies such as Ireland, Portugal and Spain.

After months of hesitation, eurozone countries and the IMF agreed to lend Greece billions at below market rates after concerns soared last week that the Greek debt crisis could trigger a knock-on effect elsewhere.

Germany, which will foot the biggest share of the bailout and was highly reluctant to extend taxpayer cash to Greece, warned the Greek government on Tuesday that loans could be halted if it did not adhere to the austerity plan.

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