Greek ministers quit as protesters clash with police

Feb 10, 2012, 17:25 GMT

Athens - The Greek government was rocked by a series of defections Friday as thousands of demonstrators took to the streets of Athens in protest at austerity measures being imposed by international lender, casting doubts over the country's future in the eurozone.

Hours after hundreds of angry rioters broke away from a peaceful demonstration involving more than 11,000 people, five Greek cabinet members, including the transport minister and the deputy foreign minister, a member of the Socialist PASOK party, handed in their resignations.

A total of six members of the 48-strong cabinet have now quit in the past two-days alone. In addition, George Karatzaferis, leader of the right-wing LAOS party that is backing the three-party ruling coalition, said he would withhold his support for the new measures.

The wave of resignations came a day after international lenders refused to agree to a second bailout for Greece, saying the country had not yet met all of their demands. They have given Athens until next week to provide guarantees on the austerity measures and on the economic reforms that Greek leaders had promised in return for funding.

If the Greek government continues to fail to satisfy its international creditors, it will not receive a 130-billion-euro (172-billion-dollar) aid package, risking a chaotic default when it faces a bond repayment in March.

Parliament is due to vote on the proposed austerity measures on Sunday. The proposals include private sector wage cuts, a 22-per cent reduction on the minimum wage, public sector layoffs and spending cuts to health, social security and defence budgets.

Faced with rising dissent, Prime Minister Lucas Papademos was reported to be considering a cabinet reshuffle, replacing his ministers with technocrats, as Italy has done.

Meanwhile, the anger on the streets of the Greek capital grew to alarming levels.

Workers went on strike and riot police clashed with hundreds of black hooded rioters, with the demonstrations expected to continue until Sunday.

In Germany, Chancellor Angela Merkel defended the costly bailout plans for Greece in a meeting with parliamentary leaders, saying it was the 'path of the least damage,' since default scenarios had 'uncontrollable' risks attached.

German Finance Minister Wolfgang Schaeuble defended the decision to withhold a decision on Greek aid for another week. 'It is not about torturing the Greeks,' he told legislators. Rather, the aim is to return Athens to a course offering the euro partners an 'adequate life.'

Two thirds of Germans doubt that Greece is serious about budget cuts, according to a survey published Friday by public broadcaster ZDF.

Just 27 per cent of those asked thought that Greece was seriously trying to implement promised austerity measures, while 66 per cent expressed doubt.

The demonstrations in Athens coincided with a 48-hour nationwide strike by Greek public and private sector workers. The walkout paralyzed public transport and forced ferries to remain moored at ports around the country.

Government offices, banks, schools, courtrooms, museums and archaeological sites remained closed, while hospitals operated with emergency staff.

The austerity measures being forced upon Greece by the European Union and the International Monetary Fund (IMF) have sparked widespread anger throughout the country, which is currently facing a fifth consecutive year of recession and posted an unemployment rate of 21 per cent for November.

Highlighting the anger, Greece's police union said in a letter that it was seeking an arrest warrant for the country's international lenders.

'You are jeopardizing Greece's democracy and the survival of its people,' the letter said. Reports said the union was seeking the arrest warrant from the Greek state attorney.

Thousands of 'Wanted' flyers were also distributed around the Greek capital, offering an award of 1 euro to anyone who apprehends officials from the EU, the IMF and the European Central Bank.