Wave of protests in northern Greece

Greek authorities yesterday braced for trouble in the northern city of Thessaloniki where separate waves of protests were due as the prime minister prepared to defend his austerity drive.

Some 4,000 police including backup from Athens and other cities have enforced a security clampdown in the city ahead of a keynote speech by Prime Minister George Papandreou on his policy priorities in coming months.

A tense atmosphere reigned on the streets of Greece’s second city as unions got ready to lead the main protest – one of five demonstrations – and one person was arrested for trying to throw a shoe at Papandreou.

Unions accuse Papandreou’s Socialist government of seeking to “overthrow” worker rights on top of a spate of wage and pension cuts enacted earlier this year as the country faced default on its debts.

Freight truckers kicked off the protests in Thessaloniki with a march to vent their anger at efforts to pry open their sector to competition.

The head of their union, Apostolos Kenanidis, said the truckers decided before the march to launch a new strike tomorrow after a week-long protest in July stranded travellers and crimped fuel supplies at the peak of the busy tourism season.

After the protests, Papandreou was to map out his economic priorities in a speech at Thessaloniki’s annual international fair, which traditionally marks the end of summer for the Greek political class.

The demos are a foretaste of labour unrest that unions have pledged to organise this autumn after six general strikes already this year against the Socialists’ tough reforms, adopted in return for a huge EU-IMF bailout loan.

The government agreed on the austerity programme in May in return for a €110 billion bailout from the EU and the International Monetary Fund.

That became necessary after the Socialists announced that the public finances were crippled with debt approaching €300 billion – estimated at 13.6 per cent of GDP. The IMF said last Friday it would provide Greece with a further €2.57 billion in its second instalment of the rescue package after Athens met tough demands to cut public spending.

In the face of strong resistance to the cuts, some of the protests have turned violent: in May, three people died after the bank they worked in was fire-bombed.

Last Friday, a group of rail unionists on motorbikes held a protest ride in Thessaloniki after communist activists had unfurled a banner on the White Tower – the city’s main landmark – calling for a fight against the measures.

Minor scuffles broke out between a small group of protesters and police outside a converted warehouse where Papandreou convened a special meeting of the cabinet that was recently reshuffled.

Finance Minister George Papaconstantinou remained at his post, but Papandreou sharpened the government’s economic focus by appointing his former anti-terrorism czar to boost development and revitalise the ailing economy.

The Greek economy is mired deep in its worst recession in years and the government’s spending cuts coupled with tax hikes are exacerbating the problem.

Official figures last week showed the economic contraction is accelerating with Greek output expected to shrink by four per cent this year while inflation is at a decade high of 5.5 per cent and half a million people are out of work.

The latest instalment of IMF cash comes on top of €20 billion in EU-IMF loans Athens had already received and more money is due to be released this month.

An audit of Greek finances beginning this week will determine whether a tranche of nine billion euros will be extended in December.