Greek anti-austerity protesters return to streets

Protesters stand in front of riot police outside the parliament during a rally in central Athens Nov 11, 2012. Parliament in Athens prepared to vote an annual budget on Sunday that will cut spending and raise taxes yet again but which the government insisted will kill off talk of Greece being forced out of Europe's currency union.[Photo/Agencies]

ATHENS - Greek anti-austerity protesters returned to the streets of Athens on Sunday, as a parliamentary vote on the 2013 budget, the second key test for the government this week, loomed.

"No to endless salary and pension cuts, no to endless tax hikes, no to endless misery," demonstrators chanted during the fresh rally organized by trade unions of private and public sector employees and opposition parties outside the parliament building.

Despite escalating protests and dissent within ruling coalition parties deputies, the 300-member assembly is expected to pass the budget bill in a midnight ballot.

Amid a similar climate, the parliament ratified early Thursday with a razor-thin 153 seat majority the harsh austerity and reform package of 13.5 billion euros ($17.1 billion), the third one of its kind in two years, to unlock further international bailout loans to Athens to avoid default.

Thursday's ballot which ended in the expulsions of seven "rebel" MPs from the parliamentary groups of ruling parties, left the four-month conservative-led coalition government with 168 seats out of the 178 it held after June's general elections.

This time, the Democratic Left party, the junior party in the coalition, is due to vote in favor of the 2013 budget. Its 16 deputies abstained from the previous vote due to reservations. Therefore, there is no major worry in Athens about the outcome.

The approval of the budget, which includes wage and pension cuts of some 10 billion euros for 2013, and the austerity package, was the main request of international lenders before the release of the next tranche of 31.5 billion euros to the debt-crippled country.

Although Greece is making progress, the Eurogroup meeting in Brussels on Monday is not expected to clear the disbursement of the tranche, according to initial forecast, due to differences between European Union (EU) and International Monetary Fund (IMF) creditors over the sustainability of the Greek debt.

The budget foresees the country's sovereign debt climbing to some 346 billion euros, or 190 percent of its GDP in 2013, up from 175 percent in 2012 with a negative outlook which indicates that the target of 120 percent of GDP set for 2020 under the bailout deals clinched since 2010 will be hard to meet.

As lenders debate solutions to the issue, Greece repeats that its cash reserves will dry out on Nov 16. In order to cover the financing gap on a short-term level, Athens proceeds to a new 3.1-billion-euro treasury bills auction on Tuesday in the context of its monthly program of T-bills sales.

As a long-term solution, Charles Dallara, managing director of the Institute of International Finance, who represented Greece's private sector lenders in negotiations which led to a voluntary "haircut" of part of the Greek debt earlier this year, suggested the reduction of the interest rates on official loans granted to Athens.

Dallara laid out his proposal in an interview with a local daily printed on Sunday, ahead of his visit to Athens.

Despite obstacles, Greek Prime Minister Antonis Samaras and his partners appear optimistic that all issues will be resolved and Greece will avoid bankruptcy and a possible exit from the euro which could trigger turmoil across the global financial system.

However, protesters on the streets who hear that further austerity is the only way to tackle the crisis were frustrated and threatened to continue the two-year wave of strikes and protests.

"Our patience has expired. We have reached our limits. We can't pay our bills anymore," Areti Kitseli, an elderly widow who lives in rent on a 700-euro monthly pension told Xinhua, as unionists argued that prolonged austerity will lead to prolonged recession and eventually dead end. (1 euro = $1.27)