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Greece: strikes, austerity & low GDP

Friday, June 10, 2011 - 01:47

June 9 - More gloom for Greece as new figures show Greece's economy has shrunk far more than expected, signalling a second wave of austerity measures demanded by the EU/IMF will pile more pain on society. Sonia Legg reports.

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Another strike cripples Athens. Employees from state companies threatened with privatisation take to the streets, alongside other union workers. The demonstrations took place as Greece's government considered the next round of cuts. The new economic plan will impose years more austerity and Greek unions say it will do more harm than good. (SOUNDBITE)(Greek) ADEDY TRADE UNION PRESIDENT SPIROS PAPASPIROS SAYING: "Privatisations, closures, mergers, and layoffs will burden the people, who will have to pay more for state services, services which today are providing a lifeline and are free." New economic data shows Greece's economy has shrunk far more than expected. Gross domestic product tumbled five and half per cent in the first three months of the year. International lenders who bailed out Greece last year with a 110 billion euro loan had expected a 3.8 percent contraction. The figures suggest Greece will now find it even harder to cut its budget deficit and keep to the terms of the bailout. A second package to top it up is still being discussed. Germany estimates Greece will need a loan bigger than the first one if its to avoid defaulting on its debt. But it wants private investors to take up much of the strain. Simon Smollett from Credit Agricole says that's fine up to a point. (SOUNDBITE) (English): SIMON SMOLLETT, CREDIT AGRICOLE, SAYING: "The problem for the market is that it is a good idea if it is voluntary but if there is any sense of compulsion then we immediately start thinking about the risks for Ireland, for Portugal and ultimately maybe even Spain." International markets maybe getting used to Greek tragedies. But it's clear many Greeks are not. Sonia Legg, Reuters

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Greece: strikes, austerity & low GDP

Friday, June 10, 2011 - 01:47