Greek PM vows to cut budget deficit
Published 10/02/2010 | 14:42
Greek Prime Minister George Papandreou has vowed to "take any necessary measures" to reduce the country's deficit.
Papandreou said "the stability programme will be implemented in every measure".
His comments came as a strike by civil servants grounded all flights and shut down public services across Greece, as unions mounted their first major challenge to the austerity measures.
Air traffic controllers, customs and tax officials, hospital doctors and schoolteachers walked off the job for 24 hours to protest against sweeping government spending cuts.
Papandreou was speaking in Paris on Wednesday following a meeting with French President Nicolas Sarkozy. European Union leaders are to discuss Greek's economic woes during a summit on Thursday in Brussels.
Greece's largest labour organisation - the umbrella GSEE union - is planning another strike on February 24.
However it remained unclear whether the protests represent the start of a serious labour backlash against the urgent reforms or a demonstration of union dissatisfaction in a country where strikes are common.
Unions ended weeks of caution after Greece's new Socialist government deepened cuts - slashing bonuses and early retirement rights, and even tapping the country's powerful Orthodox Church for more taxes.
Greece is under European Union pressure to cut spending drastically after revealing a massive undeclared budget shortfall last year which continues to rattle the euro and financial markets.
Wealthy European countries appear closer to rescuing Greece, and stocks in Europe and the United States rose on expectations of some kind of decisive action to prevent a Greek debt default which could spread to other countries, undermining Europe's hesitant economic recovery.