As Greek crisis continues, the prime minister offers to step down | Europe | News and current affairs from around the continent | DW | 15.06.2011

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As Greek crisis continues, the prime minister offers to step down

Clashes broke out in the Greek capital as thousands protested newly proposed tax hikes and spending cuts. Greece is straining under a mountain of debt, with unemployment at 16 percent and a three-year-long recession.

A protest in Athens

Protesters faced police at demonstrations in Athens

Clashes between police and protesters were reported in the Greek capital, Athens, on Wednesday as thousands gathered for nationwide strikes against government reforms, tax hikes and spending cuts.

Police fired teargas to break up the mass demonstration in front of parliament, where lawmakers were debating the cost-cutting proposals.

Protestors had said they would form a human ring around the parliament building, but some 1,500 police earlier descended on the building, blocking access using water cannon and barricades.

Transport and public services were crippled by the nationwide walk outs, as were been banks, government offices and schools. Hospitals were said to be operating with skeleton staff.

Greek journalists also walked off the job for 24 hours causing a domestic media blackout. Flights, however, were believed to be running according to schedule after the air traffic controllers' union called off their participation in the strike.

Tough task

The Socialist government of Prime Minister George Papandreou aims to push the controversial austerity measures worth some 28 billion euros ($41 billion) through parliament by the end of the month. To the chagrin of most Greeks, the package involves spending cuts and tax hikes worth 6.5 billion euros.

George Papandreou

Papandreou has seen his popularity dive in recent months

Greece needs to pass the package in order to receive the latest installment of a 110 billion-euro aid deal agreed with the European Union and the International Monetary Fund to avoid a default on its mountain of debt.

A further condition of obtaining the funding is that Greece undergoes a four-year privatization program worth 50 billion euros.

The latest strikes come a day after eurozone finance ministers held two days of inconclusive talks in Brussels aimed at solving the Greek debt crisis, which threatens to drag the euro single currency into unstable waters.

Many in the 17-member eurozone feel Greece may need a second bailout - in addition to the 110-billion-euros already agreed upon - to avoid an economically devastating default.

There were hopes after the Brussels meeting that the bones of a new deal could be agreed by the end of this month.

Later on Wednesday, the Greek prime minister was reported to have offered to step down to facilitate the formation of a national unity government.

Author: Darren Mara (AFP, Reuters, dpa)
Editor: Susan Houlton

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