Another round of violent clashes broken out in Greece, Wednesday, after protesters took to the streets against a wave of government-imposed austerity measures designed to rein in the country’s budgetary deficit. Police in Athens fired tear gas to disperse demonstrators hurling stones and petrol bombs, as a 24-hour nationwide strike bringing much of the country to a standstill.
“There are politicians which have robbed the country blind yet no one has been brought to justice.”
Doria Tsirigoi
Government offices and many schools remained closed on Wednesday afternoon, with the union-organised strike also causing major disruption to public transport and hospital services. More than 100 flights were cancelled, as clouds of smoke from the riots choked the capital city, while a journalist walkout from state and private television and radio stations resulted in a partial media blackout.
The major protests are the first of their kind this year after Greece’s Socialist Pasok administration was forced to call in a €110 billion EU-IMF bail-out last May, the EUobserver.ccm reports.
“I am demonstrating because the government has to fix this mess that it has gotten into,” hairdresser Doria Tsirigoti told the DPA German press agency as she pulled the shutters down on her salon to avoid damage.
“There are politicians which have robbed the country blind yet no one has been brought to justice.”
Government spending cuts and tax hikes linked to the EU-IMF support package have proved highly contentious with many Greek citizens.
Speaking at the protests, deputy leader of Greece’ large GSEE union, Stathis Anestis, dubbed the government measures “harsh and unfair”.
“We are facing long-term austerity, with high unemployment and destabilising our social structure,” he told the Associated Press news agency.
“What is increasing is the level of anger and desperation … If these harsh policies continue, so will we.”
On Tuesday, German Chancellor Angela Merkel indicated that the repayment period for Greece’s international loan could be extended.
The latest clashes come as EU leaders prepare to meet next month in various formats to discuss an overhaul of the bloc’s emergency lending fund and budgetary rules.
A Franco-German ‘Pack for Competitiveness’ is also on the agenda, with the package of proposals meeting a frosty reception at a European Summit earlier this month.
The euro zone’s second EU-IMF bail-out recipient, Ireland, is set for national elections this Friday, with the ruling popular Fianna Fail party headed for a humiliating defeat of historic proportions.
Anger over the bail-out lending terms has been a central element during recent election campaigning, with the front-runner centre-right Fine Gael party repeatedly stating its desire to see loan interest rates reduced.
This video is just uploaded on YouTube by Sky News. It shows a policeman being set on fire during the anti-austerity protests in Greece involving tens of thousands of people.
Five people were injured when the demonstration against government cuts turned violent. More than 30,000 had taken part in the demonstration but many were forced to take cover when youths began throwing rocks and fire bombs. The officer was hit by a petrol bomb which set his uniform and motorcycle on fire.
- The Gaddafi Effect
- Middle East CDS Spreads Explodes
- Europe: A Lehman Collapse in Slow Motion, Former Lehman Banker Says
- Are We Facing A Political Crisis, Too?
- Europe In Debt (Part 2): Poisonous PIIGS With Toxic Lipstick
- Europe In Debt (Part 1): Creating a Monster
- Europe In Debt (Part 3): Exit On Main Street
Related Articles:
- Clashes erupt amid Greece strike (bbc.co.uk)
- Athens riots erupts as Greek protesters set policemen on fire (dailymail.co.uk)
- Greek protesters clash with police during strike (cbc.ca)
- Greek strike disrupts flights, cripples services (seattletimes.nwsource.com)
- Greek riot police, protesters clash during strike (sfgate.com)
- Economists Warn Greece May Have to Quit Euro (jamblemag.com)
Ireland Applies For Bailout – IMF Plans Dramatic Spending Cuts
The Irish government will Sunday ask for the Cabinet’s approval of a financial bailout from the EU and the IMF, according to finance minister Brian Lenihan. The size of the emergency loan is still unknown. Irish financial politician Michael Noonan predict a dramatic call for spending cuts – all over the board – from the IMF.
“They’ll be looking for the dropping of programmes and a totally new way of delivering services to the public which will cost less with fewer people.”
Michael Noonan
Prime Minister Brian Cowen of Ireland
As the second EU member now prepares to be bailed out of its financial problems by the European Union and the International Monetary Fund, the IMF is getting more worried than ever and are planning a total spending overhaul.
Irish finance minister Brian Lenihan confirms that a formal application for an emergency loan from the EU/IMF is being drawn up.
The Irish Times reports that the Irish government will seek the Cabinet’s approval for the loan today, Sunday.
Following several days of negotiations with IMF/EU officials in Dublin, Mr. Lenihan says he would recommend that Ireland applies for an unspecified bailout loan.
Brian Lenihan
The minister also says he reviewed the negotiations last night and decided that the time was right to make an application for loans for both the State and the banking system.
In an interview with RTÉ Radio Brian Lenihan says: “I will be recommending to the Government that we should apply for a program and start formal applications.”
He declined to be drawn on the exact size of the loan. When asked about the scale of the loan, Mr Lenihan confirm that the figures would be “tens of billions,” however “nowhere near” the EUR 70 – 80 billion as indicated by economists and commentators.
The Irish minister points out that the interest rate charged on the loan has yet to be agreed on, but it will be signficantly lower than the rate currently available to the Government on international bond markets.
Mr. Lenihan also admits for the first time that the nation’s banks has become a too big a problem for the country to resolve on its own.
“The key issue all the time for the Government is to ensure that we do not have a collapse of the banking sector,” he says.
The euro zone finance ministers will conduct an emergency conference call Sunday evening to consider the Irish finance minister’s declaration.
According to The Irish Times, things are now moving quickly, and some believe the European authorities may seek to finalize a decision before the markets opens on Monday morning.
Predict Dramatic IMF Reform
In an interview with the broadcaster RTÉ’ earlier this week, Fine Gael finance spokesman Michael Noonan, said that the IMF is planning a “fundamental restructuring of expenditure.”
The International Monetary Fund want “fundamental restructuring of expenditure and that’s where they’ll dictate, rather than on the specifics of the cuts”, the Fine Gael finance spokesman says.
“It’s not like slicing a salami or cutting the end off a cucumber,” Noonan says, adding that the IMF “wouldn’t probably specify a cut in the minimum wage but they’d say you have to get your labour market working properly.“
“You have to do like they’re doing in the UK and ensure that work is always more valuable than welfare. And by setting the headlines and by indicating serious expenditure restructuring in a certain area the Government implementing has very few options.”
He believe a similar approach will be chosen to reform the public service sector.
The IMF had no interest in “taking a few civil servants out” here and there. “They’ll be looking for the dropping of programmes and a totally new way of delivering services to the public which will cost less with fewer people,” he says.
Mr. Noonan also predicated a “very dramatic” announcement shortly by the IMF, based on the way they operated in other countries.
He believe the first line of intervention by the IMF and other EU institutions would be the banking system rather than the government’s four-year budgetary plan and restructuring, “which could be done very quickly,” and will be dealt with before anything else, The Irish Times writes.
He suggest the IMF might follow the “good bank/bad bank” formula used in the US where the good bank traded and took deposits and bad bank took the liabilities.
“It also took the creditors who had lent them money with senior debt and they had to work out their situation over years to get what they could out of it,” Noonan points out.
Last week Michael Noonan made the following statement in the Irish Dãli (parliament/House of Representatives):
Related by The Swapper:
Related Articles:
2 Comments
Filed under International Econnomic Politics, National Economic Politics, Philosophy
Tagged as Bailout, Brian Cowen, Brian Lenihan Jnr, European Union, Financial Markets, Fine Gael, Government of Ireland, Health and Environment, International Econnomic Politics, International Monetary Fund, Irish government, Irish Times, Law & Regulations, Michael Noonan, Philosophy, Quantitative Finance, Views, commentaries and opinions