Protesters clash with police in Athens after vote in favor of austerity bill | Europe| News and current affairs from around the continent | DW | 30.06.2011
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Protesters clash with police in Athens after vote in favor of austerity bill

Protests turned ugly in Greece after lawmakers approved a contentious austerity bill that includes spending cuts, tax hikes and privatizations. A second key vote on the details of the austerity comes Thursday.

Riot police turn away from flying rocks

Police in riot gear were out in full force in the Greek capital

Greek lawmakers are set to hold a second vote on a fierce package of austerity measures Thursday, as scores of mostly young people continue their protests outside parliament in Athens.

The Greek government passed the austerity measures in a 155-138 vote on Wednesday, but the second vote will focus more on the details of their implementation. The market outlook was optimistic on Thursday after trading in Asia and North America boosted the euro against the dollar.

Meanwhile, police and protesters battled in the streets of Athens with rocks and tear gas into Thursday morning after the first vote, which the European Union had demanded in exchange for a desperately needed installment of an emergency loan package. Tens of thousands of people had gathered outside parliament ahead of the vote.

Outside parliament, Syntagma Square came to resemble a war zone with clouds of tear gas and flying rocks. Medical workers said some 500 people sought treatment for heart and respiratory problems stemming from the tear gas and for blows to the head. About 30 people were arrested.

One group of anarchists armed with Molotov cocktails and iron bars attacked the Finance Ministry building near Syntagma Square, breaking windows and at one point setting fire to the building.

Police said one lawmaker with the governing party who had vowed to vote against the bill but ultimately supported it was attacked for his change of heart. Local TV footage from a mobile phone video showed Alexandros Athanassiadis being taunted, and police said protesters threw water bottles at him.

Prime Minister George Papandreou has a slim majority in parliament, but a small number of lawmakers from the ruling Socialist party had threatened to vote against the measure, which includes 28 billion ($40 billion) euros in cuts and 50 billion euros in privatizations.

Protestor throws a table against police in Syntagma Square in front of the Greek Parliament

Some 500 people sought medical treatment as police and protesters battled in the streets of Athens

Welcomed abroad

While the vote was met with anger at home, the response was much more positive among key European leaders.

German Chancellor Angela Merkel, whose country is a major contributor to the Greek bailout, said the vote was "both an important step for the future of Greece and for the stability of the euro. We, the European Union, stand ready to help."

The EU's top officials said if the second bill is passed on Thursday as expected, it would pave the way for the disbursement of the next tranche of financial assistance and allow work to begin on a second assistance package later this year.

"The country has taken an important step forward along the necessary path of fiscal consolidation and growth-enhancing structural reform," said European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy in a joint statement.

"But it has also taken a vital step back - from the very grave scenarios of default. This was a vote of national responsibility."

Greek Prime Minister George Papandreou

Papandreou has struggled with party revolt and opposition to austerity measures

An uncertain future

Following the vote, oil prices surged and world stocks rose, with the bill's passage soothing - at least temporarily - investors nervous about the possibility of Greece becoming the first eurozone country to default on its loans. A Greek default could have global implications and there was concern of a potential slashing of demand for energy.

"The fact that the Greek parliament has passed the government's medium-term fiscal plan clearly reduces the chances of near-term disaster," said Ben May, an economist from Capital Economics in London. "But there are major challenges still ahead. The next is to reach agreement on a second bailout package, the crux of which will be the plans for some form of debt rollover."

Many economists remained concerned that Greece could still default and that the government may not be able to fulfill all of the strict fiscal requirements required by the EU and the International Monetary Fund for their bailout of the troubled nation.

A crucial cash injection of 12 billion euros could, however, soon be on its way. Eurozone finance ministers are set to meet this Sunday.

Author: Holly Fox, Andrew Bowen (AFP, AP, dpa, Reuters)
Editor: Martin Kuebler

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