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Last Updated: Thursday, 17 March, 2005, 09:57 GMT
Greek economic woes spark strike
By Richard Galpin
BBC News, Athens

Train tracks in Athens in February
Rail workers are among those joining industrial action
Trade unions across Greece have started a 24-hour strike against rising unemployment and high inflation.

They say the conservative government has failed to fulfil financial pledges made during last year's election.

It follows a government warning that Greece faces a difficult period as it struggles to control a budget deficit above limits set for euro states.

Teachers, bank employees, railway staff and postal workers are just some of those taking part in the stoppage.

The industrial action is expected to be the most serious challenge from the trade unions since the conservative New Democracy party was elected almost exactly a year ago.

There will also be rallies and demonstrations in the capital, Athens.

Brussels pressure

A spokeswoman for the General Confederation of Greek Labour told the BBC the strike was a warning to the government that it must take action to tackle rising unemployment, inflation and to improve pensions and social security.

But the government is under pressure from Brussels to cut public spending to ensure the ballooning budget deficit is brought under control within the next two years.

The deficit is currently running at almost twice the level permitted under the stability pact for countries within the euro zone.

In a surprisingly frank speech last week, Prime Minister Costas Karamanlis gave a very downbeat assessment of the national economy, saying it was obvious it was not functioning as it should. And he warned that reducing the budget deficit over the next two years, although feasible, would be very difficult.

On Wednesday, the prime minister held talks in Brussels with the President of the European Commission, Jose Manuel Barroso, about the deficit as well as fears that EU funding for Greece could be cut by billions of euros from 2007.

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