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Austere times

December 23, 2010

Greece's parliament has approved a tough austerity budget despite opposition from left and right. The vote was accompanied by strikes and protests due to wage cuts and tax hikes.

Riot police guard the Greek parliament
Police were prepared for violent protestsImage: AP

Greek lawmakers approved a tough austerity budget early on Thursday to comply with the demands imposed as part of an international bailout to the debt-ridden country.

The new budget for 2011 was debated for five days before being adopted by 156 votes to 142. The ruling Socialist party backed the measures in the face of opposition from the right and left.

Some 6 billion euros ($7.9 billion) will be cut from the government budget in an attempt to reduce Greece's deficit from 15.4 percent of gross domestic product in 2009 to 7.4 percent. This follows austerity measures introduced earlier this year.

Greek Prime Minister George Papandreou said that the country was in the grip of a "deep crisis," and urged the opposition to join with his party in the "race" to save the nation for future generations. "I am more determined than ever to change Greece," Papandreou said. "We will not go bankrupt."

George Papandreou
Papandreou narrowly got his spending cuts through parliamentImage: AP

Conservative opposition leader Antonis Samaras argued that austerity - and taxes - were crippling the Greek economy. "The way out of this crisis lies in growth," said Samaras.

Some 3,000 union members and communists staged separate demonstrations on Wednesday to call for the budget to be rejected.

Bus and subway drivers in Athens staged their fourth strike this month against wage cuts. The cuts are one aspect of the austerity measures that Greece put in place as a condition for receiving a 110-billion-euro bailout from the IMF and EU.

Author: Richard Connor (AP, AFP, Reuters)
Editor: Nancy Isenson