Greek strike grounds flights, shuts ministries

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A nationwide strike grounded flights, trains and ferries in Greece on Wednesday as thousands rallied in Athens to protest austerity plans aimed at wrenching Greece out of a debt crisis that has shaken the euro zone.

Holding banners reading "Markets should pay for the crisis," protesters gathered ahead of a march to parliament against a public wage freeze, tax hikes and the raising of the retirement age.

Participation in the walkout will be a barometer for ordinary Greeks' support for government efforts to shore up deteriorating public finances that have rattled markets and worried its European Union partners.

"Today, Europe's eyes are turned on us, today we are demonstrating for hope and future…to cancel the measures," Yannis Panagopoulos, head of the private sector union GSEE, told the rally.

It is the first joint strike called by public and private unions representing half of Greece's workforce of 5 million since the Socialist government won elections in October.

Most shops were open, although some banks were shut down and the capital's chaotic traffic was quieter than usual. The Athens stock exchange was operating normally.

Crowds at bus stops downtown complained about the disruption to public transport. All but emergency flights to and from Greece were grounded and ferries were at a standstill. Monuments such as the Athens Acropolis shut down.

"I am striking against the wage cuts…because others stole the money and we are the ones who are going to pay," said 36-year old civil servant Michalis Koroleos. "They are cutting my allowances and I have two children to raise."

Greeks are prone to take to the streets in demonstrations that can turn violent, but opposition to the austerity measures has so far been largely symbolic. Opinion polls show most Greeks want to give the government time.

"EU PRESSURE"

In central Athens some said they saw no reason to strike.

"I don't want to participate in the strike," 62-year old gas station owner Dimitris Makrivellios said. "Aren't people also responsible for this situation? Our economy's problems concern us all. Why should we strike?"

The strike coincides with a visit by EU officials assessing whether Greece is on track to cut its double-digit deficit.

"The team of inspectors coming from the Commission, the ECB and the IMF … will get a taste of the dynamic reaction of the Greek workers to the huge pressures from Brussels," centre-left Eleftherotypia newspaper wrote in an editorial.

Under the scrutiny of EU policymakers and markets, the government has so far refused to give in to protesters' demands. Finance Minister George Papaconstantinou said on Tuesday the government might decide on more measures to cut the deficit after talks with the visiting EU inspectors.

In a sign of persisting jiiters on Greek markets, the premium investors demand to buy 10-year Greek government bonds rather than German benchmarks rose on Wednesday after Czech Finance Minister Eduard Janota said Greece would find it impossible to slash its budget deficit as fast as promised.

Fitch Ratings on Tuesday downgraded the ratings of Greece's four largest banks, expecting fiscal tightening to weigh on the economy and loan demand, hurting profits.

Unions say the government's plan will only burden the poor and have threatened to stage further strikes next month.

"We ask the government not to give in to the desires of the markets, to set people's needs as a priority and adopt a mix of economic and social policies that won't lead to recession but to jobs," said GSEE's Panagopoulos.

Spanish workers unhappy about plans to raise the retirement age marched on Tuesday but the main protest in Madrid seemed relatively small in a sign that the country's unions may be weakening.

Portugal's second largest union warned on Monday it would call more strikes if the government extended a public sector wage freeze beyond this year.