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Strikes hit Athens as debt inspectors return

January 17, 2012
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ATHENS, Greece—Strikes and demonstrations over austerity measures hit the Greek capital of Athens on Tuesday, as international debt inspectors returned to resume their scrutiny of the country's reforms.

The officials from the European Union and International Monetary Fund, which are lending money to Greece to keep it from bankruptcy, are expected to press the government for faster cost-cutting reforms.

Greece's continued access to bailout loans depends not only on delivery on its austerity promises but also on negotiations with private creditors on a bond swap deal aiming to cut its debt by euro100 billion. It needs to get an agreement soon if it is to secure more rescue loans, with a bond repayment of euro14.5 billion due in late March.

Some 10,000 protesters took part in rallies in central Athens over potential pay cuts in the recession-battered private sector. Anti-austerity strikes in the capital disrupted public transport and other services. Journalist unions also launched a 48-hour strike.

Under government pressure, unions and employers are due to launch talks Wednesday to explore ways of slashing labor costs. Lower-level members of the debt of the debt inspection team started the talks in Athens on Tuesday, with the mission chiefs due Friday.

Meanwhile, Greece saw its borrowing rates ease marginally in a bill auction on Tuesday.

The public debt agency said it raised euro1.625 billion ($2.06 billion) in a sale of 13-week treasury bills, an interest rate of 4.64 percent, compared with 4.68 percent in the last such auction in December.

Demand for the bills was 2.90 times the amount on offer, roughly the same as last month.

Unable to issue long-term debt due to untenably high borrowing costs, it maintains a market presence through regular treasury bill auctions.

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