Papandreaou will not budge despite violent protests over austerity measures

Greek Prime Minister George Papandreou vowed to press ahead with austerity measures on Saturday as protestors clashed violently with police in the country’s second city Thessaloniki. 

Reuters/Grigoris Siamidis

In a speech at a political gathering, Papandreou reiterated his government's commitment to speeding up privatisation and shrinking the public sector, as demanded by the European Union and the International Monetary Fund.

"At the point where the eurozone is now ... every delay, every hesitation, every option other than strict compliance with our commitments ... is dangerous for the country and its citizens," he said as about 25,000 anti-austerity protesters took to the streets nearby.

Eurozone leaders announced a 159-billion-euro rescue package for the country in July, but Athens is having difficulty meeting the conditions to receive its next instalment of funding, with sufficient cash in reserve for only a few weeks.

Greeks fear that the state sell-off will be too cheap, and complain that some 20,000 state employees will be laid off and many others will have their wages cut amid unemployment that reached 16 per cent in June.

Meanwhile, anti-riot police used teargas to push back about 3,000 taxi owners among the protesters, picketing over liberalisation of their industry, one of the many reforms announced by the government to achieve savings.

The protests were organised by an "indignant" group named after a similar youth protest movement in Spain.

Members of Greece's private and public sector unions were also out in force, along with supporters of the local Heraklis football club protesting against their exclusion from the first division.

A record 7,000 police were on duty to prevent an estimated 25,000 demonstrators surrounding the congress hall where the prime minister was speaking.