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Rioters kill three bank workers in Athens protests as EU warns Britain's debt crisis will be worse t

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Rioters kill three bank workers in Athens protests as EU warns Britain's debt crisis will be worse than Greece's



By Mail Foreign Service

Last updated at 5:50 PM on 5th May 2010




  • Europe warns UK debt is biggest challenge to general election winner

  • Greek PM brands the deaths of two women and a male worker 'murder'
  • Athens descends into anarchy as up to 100,000 take to the streets

  • Merkel calls for aid package to be cleared as 'future of EU is at stake'
  • Euro slumps and stocks slide as debt fears spread to Spain and Portugal
  • Ratings agency Moody's warns Portuguese debt may be downgraded

Three bank workers died in a blaze at their Athens office block today after violence broke out in a mass demonstration against Greece's government.

Anarchy engulfed Athens as protesters torched the bank. Up to 100,000 people took to the streets, many chanting 'Thieves, thieves!' while hurling projectiles at police and trying to storm the parliament.

Greek prime minister George Papandreou denounced what he called the 'murder' of two women and one man killed when bank was set alight as the mob protested against austerity measures imposed under Greece's international bailout package.

The spiralling crisis triggered a fall in global markets and the euro, and served as a grim reminder of the perilous state of Britain's economy as the country prepares to go to the polls tomorrow.


New figures from the European Commission revealed today that the UK budget deficit will outstrip any country in the EU this year - including Greece.



article-1273020-09711B4B000005DC-405_634x556.jpg Two employees, covered in black from the smoke, cry out in terror from the top floor of the Marfin Egnatia Bank where they were trapped



article-1273020-097103DF000005DC-899_634x417.jpg Smoke pours from the bank as the two trapped women peer desperately down from the balcony



article-1273020-09711B80000005DC-356_634x951.jpg Firemen reach the balcony and coax one of the women down on to the ladder



European Commissioner Olli Rehn warned that the UK’s ‘very high’ public debt presents ‘by far the first and foremost challenge’ to the winner of tomorrow's general election.


And David Cameron today claimed that Britain must elect a Conservative government tomorrow.

'We have just a few hours left but we've got to make these hours count because the worst thing we can have is another five years...of debt and waste and taxes,' he said.

Fears of a Greek contagion in Europe spread again today as Moody's warned Portugal's debt could be downgraded.

As the euro plunged to a 14-month low and world markets slid on the news of the violence in Athens, European Union officials tried to calm investor fears, insisting Greece was a unique case.

But Moody's Investor Services, a major ratings agency, put Portugal's bond rating on review for possible downgrade. Spanish and Portuguese bonds and stocks slumped further on the news, reflecting fears that they may likewise have trouble repaying their debt and that the eurozone would have to extend even larger bailouts to them.


Protesters clashing with police tested the Greek government's resolve in enacting deep budget cuts in return for the billions of euros in EU/IMF aid.


In the worst violence since the Socialist government came to power in October, hundreds of striking demonstrators pelted police with rocks, chunks of marble and bottles, set garbage cans on fire and tried repeatedly to storm parliament, shortly before lawmakers began a debate on the belt-tightening measures.


article-1273020-09715550000005DC-535_634x669.jpg 'Murder': A medic prepares to remove the body of a woman who perished in the bank fire today



article-1273020-0970BBF7000005DC-286_634x458.jpg Anarchy: Demonstrators wearing gas masks and bike crash helmets throw stones at police in central Athens today


article-1273020-0970B13D000005DC-416_634x399.jpg Greece ablaze: A riot policeman falls after being hit with Molotov cocktail near the Greek parliament in Athens as demonstrations turned violent today




The violent protesters were repelled by police in full riot gear hurling repeated rounds of tear gas and flash bombs, and smoke wafted through blocks of central Athens.

Masked youths threw petrol bombs, broke shop windows and shouted 'Murderers' and 'Burn the parliament', in a sign of swelling public anger at the government's plans for painful wage and pension cutbacks.







A giant plume of dark grey smoke rose over the central Stadiou Avenue where the two-storey commercial building, which houses a branch of the Marfin bank, was burning.


Officials said two other buildings in the centre of the capital had been set on fire during the protest.

Police estimated the march at about 27,000 people. But eyewitnesses said there were at least 40,000, while some estimates put the total as high as 100,000 - easily the biggest protest since Greece was first hit by a debt crisis late last year.


article-1273020-09701DCC000005DC-672_634x395.jpg Rising up: Demonstrators massing in Syntagma Square in front of the Greek parliament in Athens today


'The moment we heard that three people died, the stock market extended losses,' said Takis Zamanis, head trader at Beta Securities.


'There is fear that reactions against the austerity measures will climax.'financial crisis continued to wreak havoc on European stock markets this morning as fears that the debt problem could spread to other European countries continued.


Moody's warning over Portugal was just one factor that sent the markets plunging.


As Spain denied that it will need to an aid package similar to Greece to avoid a sovereign debt default the FTSE 100 fell by nearly 1pc to below 5,400. By 09.00 it had fallen 49.2 points to 5361.9. It later regained the lost ground and was 7.39 points higher at 5418.5.

The euro slid to a 14-month low against the dollar in early trading, standing at $1.2935. Sterling held steady against the dollar after tumbling to a five-week low yesterday, moving in tandem with the euro. The pound, however, is at a nine-month high against the euro at €1.168.

article-1273020-0970B65C000005DC-329_634x421.jpg Scene of horror: Riot police in front of the burnt-out Marfin Egnatia Bank, where three people died after it was set ablaze during the massive demonstration in Athens today



article-1273020-0970C29B000005DC-238_634x427.jpg Protesters hurl rocks and other missiles at riot police during today's clashes


EU Monetary Affairs Commissioner Olli Rehn warned that the euro zone must contain the debt crisis 'bushfire' in Greece to prevent Athens' problems spreading and threatening the economy of the whole European Union.

'In order to safeguard the economic recovery, which is still rather modest and somewhat fragile, it's absolutely essential to contain the bushfire in Greece so that it will not become a forest fire and a threat to financial stability for the European Union and its economy as a whole,' Rehn told a news conference.

'The euro area is taking care of the Greek case. I'm confident we will succeed to turn things around concerning Greece.'


article-1273020-0970B7A1000005DC-925_634x490.jpg Protesters sit on a chair in front of Greek parliament building today


Rehn criticised feverish speculation on financial markets following market rumours that Spain would need an aid mechanism similar to the one provided to Greece.

Yesterday gold hit a record £779.39 an ounce as investors sought shelter from the gravest crisis in the 11-year history of the single currency.

At the heart of the latest bout of selling are doubts that Athens has the stomach to take the necessary steps to tackle its soaring debt mountain.

article-1272750-096F83D0000005DC-90_306x375.jpg German Chancellor Angela Merkel urges the Bundestag this morning to approve the £19bn rescue package. 'Nothing less than the future of Europe, and with that the future of Germany in Europe, is at stake,' she said


Germans are outraged at signing the biggest cheque in history to save Greece - while Athens goes ahead building a new £16million embassy in the heart of Berlin.

To be completed in two years - by which time Greece will have received over 100billion euros (£85billion) of its record bailout package - the new embassy will build on the ruins of the one destroyed in World War II.

'These Greeks!' thundered the Berlin Kurier newspaper. 'Broke, but they are still building a new embassy!'

The row comes as Chancellor Angela Merkel this morning asked lawmakers to quickly approve the £19billion from Germany over three years in aid for Greece, saying that the 'future of Europe' is at stake.

'Nothing less than the future of Europe, and with that the future of Germany in Europe, is at stake,' she said. 'We are at a fork in the road.'

Flights to and from Greece were grounded today, trains and ferries suspended their routes and public services were paralysed.

The 24-hour general strike shut down schools and customs offices and left hospitals working with emergency medical staff.

The Acropolis and all other ancient sites were closed, while journalists also walked off the job, suspending television and radio news broadcasts.

Public and private sector unions concede that the cash-strapped government was forced to slash spending, including cutting salaries and pensions for civil servants, and increase consumer taxes, to secure the vital 110billion euro (£94 billion) three-year loan package from European partners and the International Monetary Fund.


article-1273020-0970B80F000005DC-327_634x443.jpg A demonstrator wearing a gas mask hurls projectiles at police during the violence today



But they say low-income Greeks will suffer disproportionately from the measures, which aim to save 30billion euro (£25 billion) - the country's current budget deficit - through until 2012.

The cuts were insisted upon by Germany, the paymaster of Europe, before it would sign off on the bailout.

Today Chancellor Merkel urged her country's lawmakers to approve the £19billion from Germany over three years in aid for Greece, saying that the 'future of Europe' is at stake.

Merkel's Cabinet agreed Monday upon the German contribution to the bailout by the European Union and International Monetary Fund.

Without the rescue package, a chain reaction threatened to destabilise the European and international financial system, she warned.

The decision to contribute to the bailout may cost Merkel in regional elections this weekend.


article-0-096CAE39000005DC-157_634x429.jpg No to austerity: Protesters clash with riot police yesterday as bout 4,000 teachers and students marched to Parliament to protest the cuts


The head of the International Monetary Fund acknowledged the risk of the debt crisis spreading from Greece to other European countries but said he saw no real threat to the big euro zone states such as France and Germany.

'There is always a risk of contagion,' Dominique Strauss-Kahn told French daily Le Parisien.


'Portugal has been mentioned, but it is already taking measures and the other countries are in a much more solid situation ... but we should remain vigilant.'

Strauss-Kahn criticised the 15 other euro zone governments for charging Greece a 5 per cent interest rate on the loans, largely at Germany's insistence.

'I think the rate at which the Europeans lent should have been equal to that of the IMF, which is lower by more than half a point,' he said.


Almost every big protest this year has been marred by violent clashes between protesters and police. Two months ago, rioters chased ceremonial guards away from the Tomb of the Unknown Soldier outside parliament.

Discontent has intensified as civil servants and pensioners face deep income cuts and consumer taxes have been increased again.

Despite the strike, the draft bill of the new austerity measures is to be discussed at committee level in parliament today, and will be voted on tomorrow.


Prime minister George Papandreou's Socialists hold a comfortable majority of 160 in the 300-seat Parliament, and with a simple majority of 151 votes needed, the bill is expected to be passed easily.


article-1273020-09709800000005DC-224_634x639.jpg Riot police are hit with more Molotov cocktails in front of the parliament today






Main opposition leader Antonis Samaras said his conservative New Democracy party would vote against the bill because it disagrees with the government's handling of the crisis.

Mr Papandreou had been hoping to bring opposition leaders on board, insisting that the measures are essential if the country is to survive.


But opposition parties have harshly criticised his handling of the crisis, and Mr Samaras's move to vote against the legislation is more a symbolic gesture.

'In any case, the government does not need our vote to have the law approved,' he acknowledged, adding that his party would respect the Socialists' commitments to the EU and IMF if elected to power.


With debts of £260 billion and a budget deficit of 13.6 per cent of gross domestic product, Greece has been struggling to pull its finances in order and was less than three weeks away from default when the eurozone finance ministers agreed on Sunday to activate the three-year £95 billion eurozone and IMF rescue.

Germany was very reluctant to help Greece, with chancellor Angela Merkel finally agreeing to give £19billion over three years as part of a wider bailout.

The German government realised that letting Greece go bankrupt could send the euro into a tailspin and hurt Germany's own economy.

Mrs Merkel said the money would not only help Greece but would help the 'stabilisation of the euro as a whole and, therefore, help the people of Germany'.

The remark was a nod to the popular discontent in Europe's biggest economy about having to pay so much to help a fellow European Union country that many Germans feel has been fast and loose with its finances for years.

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Anarchy: Demonstrators wearing gas masks and bike crash helmets throw stones at police in central Athens today


Wait, I thought Greece has a government? And wasn't the government responsible for ensuring the safety of its citizens? This seems like a failure of government rather than anarchy.

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