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Friday 9 December 2016

Athens passes harsh austerity bill as protests rage on streets

Greek lawmakers today voted overwhelmingly to approve a harsh austerity bill demanded by bailout creditors, despite significant dissent from members of Prime Minister Alexis Tsipras' own left-wing party.

The bill, which imposes sweeping tax hikes and spending cuts, fuelled anger in the governing Syriza party and led to a revolt against Tsipras. He had insisted the deal forged after a marathon weekend eurozone summit was the best he could do to prevent Greece from catastrophically crashing out of the euro.

The legislation was approved with 229 votes in favour, 64 against and six abstentions - and won the support of three pro-European opposition parties. Among Syriza's 38 dissenters were prominent party members, including former finance minister Yanis Varoufakis.

The post-midnight vote might not pose an immediate threat to Tsipras' government, but it raised more doubts over whether it could implement the harsh new austerity program demanded by rescue lenders.

The vote came after an anti-austerity demonstration by about 12,000 protesters outside parliament degenerated into violence as the debate was getting under way yesterday night. Riot police battled youths who hurled petrol bombs for about an hour.

The bill was the first step Greece must take in order to begin negotiations with creditors on a new bailout - its third in five years - of about €85bn in loans over three years.

Poverty

Dissenters argued that Greeks could not face any further cuts after six years of recession that saw poverty and unemployment skyrocket and wiped out a quarter of the country's economy.

Tsipras has been battling all week to persuade party hard-liners to back the deal. He has acknowledged the agreement reached with creditors was far from what he wanted and trampled on his pre-election promises of repealing austerity, but insisted the alternative would have been far worse for the country.

"We had a very specific choice: A deal we largely disagreed with, or a chaotic default," he told parliament ahead of the vote.

Tsipras had urged Syriza members to back the bill despite having urged voters to reject earlier, milder creditor demands in a July 5 referendum. Greeks voted overwhelmingly to reject those proposals.

Finance Minister Euclid Tsakalotos said the deal Greece reached with its creditors on Monday was the only possible choice.

"I don't know if we did the right thing. But I know we did something with the sense that we had no choice. Nothing was certain and nothing is," he told parliament.

High-ranking dissenters included Alternate Finance Minister Nadia Valavani, who resigned from her post earlier Wednesday, saying she could not vote in favour of the bill.

She said she believed "dominant circles in Germany" were intent on "the full humiliation of the government and the country".

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