Greek Unions Strike as Papandreou Seeks Support

June 28, 2011

Greek unions shut down government services, halted public transport and disrupted flights as Prime Minister George Papandreou urged lawmakers to obey their “patriotic conscience” and back tougher austerity measures.

Unions began their fourth general strike of the year at midnight, protesting Papandreou’s five-year plan of budget cuts and asset sales. The 48-hour walkout will be accompanied by rallies and marches to Parliament in Athens today.

“Voting for the medium-term plan means we can close this chapter of uncertainty for the Greek people,” Papandreou told lawmakers at the start of a three-day debate late yesterday. “From the brink of catastrophe we are securing, colleagues, the great opportunity to change our country.”

Papandreou faces his second survival test in a week tomorrow when lawmakers vote on the package that’s needed before the cash-strapped nation can tap a fifth loan payment from last year’s 110 billion-euro ($157 billion) rescue. Failure to pass the government’s 78 billion-euro plan may lead to the euro area’s first sovereign default.

“I am fully aware of the reality, fully aware of the risks for the average Greek,” Finance Minister Evangelos Venizelos said in Parliament in the same debate, defending the planned tax increases and state asset sales. “We have to stabilize the situation. But we must first survive on a fiscal basis to be able to improve this situation.”

Vote Looms

With 155 votes in the 300-seat legislature, Papandreou needs to unite his lawmakers in two votes this week on budget cuts and asset sales. Two ruling-party lawmakers have said they may vote against the legislation, in part due to their opposition to plans to sell a stake in Public Power Corp. SA.

Workers at the former electricity monopoly have held rolling 48-hour strikes for the past week, leading to power cuts around the country.

Air traffic controllers will cease work for eight hours today and tomorrow, according to a statement on the union’s website, which has caused the cancellation of all flights into and out of the Athens International Airport, the country’s biggest, between 8 a.m. and midday and 6 p.m. and 10 p.m. today, according to an airport statement.

Aegean Airlines SA (AEGN) will reschedule 97 flights and cancel 26 today while Olympic Air will cancel and reschedule 52 flights.

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