Greek anger over debt measures flares again
Angry Greeks took to the streets Tuesday to protest a new round of austerity measures, ending days of relative calm in the country and shattering investor confidence.
A group of about 100 members of the Greek Communist Party cut through locks on the gates of the ancient Acropolis, the country's most famous monument, and unfurled two large banners that read: "Peoples of Europe — Rise Up."
Police did not intervene as a separate group carrying red flags stood beside the ancient Parthenon, the largest surviving structure on the Acropolis, next to the banners.
About 4,000 teachers and students marched to the Greek parliament to protest the $40 billion over two years in spending cuts the cash-strapped government announced Sunday. They were carrying black flags and holding banners reading: "Send the bill to those responsible."
Scuffles broke out as they approached the parliament building, with demonstrators throwing stones at riot police, who responded with small bursts of pepper spray to keep the crowd back.
The cutbacks are aimed at obtaining a $147 billion rescue package of loans from the International Monetary Fund and the euro nations.
The bill, which would make deeper cuts to public servants' pay and hike sales taxes again, is set to be voted into law by the end of the week.
"This is a message to the people of Europe," said Communist Party official Panagiotis Papageorgopoulos, who was among the protesters. "People have the same problems everywhere. We can take control of our fate with organized protests, so that our lives are not run by the EU and the IMF."
The unrest ended days of relative calm in Greece after global stock markets seesawed last week amid fears Greece would default on its loans. The euro plunged to a new one-year low of below $1.31 US on Tuesday. And the yield on Greek bonds fell again, pushing the spread between Greek and benchmark German bonds to above 600 points.
Jitters over whether the bailout will ever see the light of day pushed Spanish and Portuguese bond spreads higher and rocked global stock markets. Shortly after opening, the Dow Jones Industrial Average in New York plunged more than 220 points to 10,927. Toronto's S&P/TSX Composite Index lost 170 points to 12,026, and the Canadian dollar was off more than a cent.
With hundreds of billions in debt and a budget deficit of 13.6 per cent of gross domestic product, Greece has been struggling to pull its finances in order. It was less than three weeks away from defaulting when the euro zone finance ministers agreed on Sunday to activate the rescue.
Athens needs to see the first installment of funds before May 19, when it has more than $11 billion worth of bonds due.
On Tuesday morning, France's lower house of parliament adopted a budget amendment allowing the government to release French funds for Greece's bailout.
The legislation must still go before the Senate, its final step in parliament. France has committed to providing up to $23 billion in its share of the three-year plan.
Finance Minister Christine Lagarde had urged lawmakers to adopt the amendment, calling it a "moral imperative" and saying that providing funds for Greece would be a way of "stabilizing the euro."