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Greek riot police battle with austerity protestors

Greek riot police clashed with angry protestors in the early hours of Thursday night, hours after Parliament approved a harsh austerity bill designed to guarantee an international bailout.

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REUTERS - Greek police clashed with protesters outside parliament in the early hours of Thursday ahead of a vote expected to approve a final austerity bill needed to secure international aid and avert a debt default.

The government of Prime Minister George Papandreou, which won a first vote on Wednesday by 155 to 138 votes, expects to pass the second and final bill covering 28 billion euros in tax hikes, spending targets and privatisations agreed as part of an EU/IMF bailout.
 
Parliament resumes debate at 9:30 a.m. (0630 GMT) and the decisive vote is not expected before 2 p.m. (1100 GMT). Before the debate, it had not yet been decided whether more than one vote would be needed to pass it.
 
"I expect that the MPs who backed the mid-term plan will also vote for the implementation law," government spokesman Ilias Mosialos said in a television interview.
 

World stocks rallied on Thursday for the third day running and the euro rose to its highest dollar level in 20 days on relief that Greece looked set to avoid the euro zone's first debt default.

 
The optimism was mixed with concern though over whether the government will be able to implement the unpopular cuts in practice to meet a tight schedule imposed by the EU and the IMF.
 
"There are still a lot of unanswered questions about the effective implementation of austerity measures, given the backdrop of increasing public anger in Greece," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.
 
Implementing the measures will be hard for the government, which has fallen behind the opposition in opinion polls and has faced heated criticism from its own deputies during the parliament debate.
 

Unions, which paralysed the country for 48 hours earlier this week, have vowed to oppose privatisations and other austerity steps.

 
Anger among the Greek population was underlined by violence which on Syntagma Square outside parliament as Wednesday's votes on the first bill were being counted.
 
Doctors working with the demonstrators said they had treated at least 25 people for minor injuries and hundreds with respiratory problems at the adjacent Syntagma metro station. At least 40 police officers were hurt, the police union said.
 
Hooded youths and police fought battles into the night, choking the city centre with tear gas and smoke from petrol bombs. The protesters set fire to the post office in the building where the Finance Ministry is located, and tried to set ablaze a bank. Across the square, the luxury King George Hotel was evacuated.
 
Parliament must pass both bills for the European Union and International Monetary Fund to release a 12-billion-euro loan -- essential for Greece to meet debt payments in July -- under a 110-billion-euro bailout agreed in May 2010.
 
The laws are also needed for talks on a planned second and longer-term bailout of about the same size, which will include some 30 billion euros in private-sector participation. Locked out of bond markets, Greece needs the extra cash to avert default and keep the debt crisis from spilling over to the rest of the euro zone.
 

Papandreou, who reshuffled his cabinet earlier this month to secure support for the bills, said he was determined to push through reforms.

 
"Today, I am more determined than ever," Papandreou said. "Now is the time to tackle everything that is wrong, with everything that hurts us, that holds us back."
 
Thursday's vote enables individual budget measures and creates a privatisation agency. The conservative New Democracy opposition, which voted against the first bill, said it would support some of the measures in the second.
 
"We will reject it in principle. However, we will support the privatisations mechanism as well as the articles on spending," said New Democracy deputy Yannis Vroutsis.
 
Still, analysts said the real challenge will come after the bill is voted on and the international money secured.
 
"The implementation law will also pass, without problems," said Costas Panagopoulos, head of ALCO pollsters. "The real question is whether Papandreou will use this vote to move forward with these crucial reforms."

 

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