Greeks strike over new austerity measures

In Greece, taxi drivers, bus and tram operators and tax collectors prepared to strike for a second day on Wednesday, and rail and metro workers promised to join them.

Lawmakers opened the way to the troika visit on Tuesday by passing a property tax bill. That piles the pressure on Greeks suffering from several waves of belt-tightening and deepens an economic downturn heading into its fourth year.

Prime Minister George Papandreou's 154 Socialist deputies forced the measure through in the 300-seat parliament.

Police dispersed thousands of protesters with tear gas in Athens's Syntagma Square, centre of anti-austerity protests that culminated in bloody clashes with police in June.

"I've been trying to find a job for a year now and it's impossible," said Maria Kappa, a graduate of the School of Philosophy in Athens. "I don't see the rich people hurt by this austerity, it's always the poor who have to pay."

Inertia in implementing the bailout deal coupled with European leaders' inability to erect a wider safety net stoked fears a Greek default could bring down other euro zone states such as Italy and Spain and trigger a new global recession.

Angry at the Greek government's slowness in starting reforms, the troika quit talks with Athens this month and threatened to shut off funding unless it mended its ways.

Finance Minister Evangelos Venizelos has since drafted a plan to catch up on the delays, which have put the government behind on a goal to cut the budget shortfall to 7.6 percent of gross domestic product this year.

In the accelerated strategy, the government will cut the 730,000 public workforce by a fifth, reduce the public wage bill by 20 percent, as well as lower overall pensions by 4 percent in addition to a 10 percent cut already agreed in previous plans.

It will also now extend the new real estate tax until 2014, two years longer than originally planned, after the troika judged Greece's estimate that it would raise 2 billion euros a year to be two times too high.

The EU and the IMF say Greece has been focusing too much on one-off tax measures to plug its budget gap rather than streamlining the administration and cutting spending.

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