Two more Greek ministers resign

11 Feb 2012, 2:03 pm   -   Source: AAP
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A protester throws a stone in front of graffiti that says 'cops you will be eaten by your kids' during a large demonstration in Athens (Getty)

A protester throws a stone in front of graffiti that says 'cops you will be eaten by your kids' during a large demonstration in Athens (Getty)

Two more deputy ministers have resigned from Greece's coalition government over new austerity measures, as protesters vent their anger in Athens.

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Two more deputy ministers have resigned from Greece's coalition government over new austerity measures being imposed on the country by international lenders.

A total of four deputy ministers, all belonging to the small LAOS party that is supporting the coalition government, have now resigned since Thursday.

Greek news reports said Prime Minister Lucas Papademos may go ahead with a cabinet reshuffle later in the day.

VIOLENCE ON THE STREETS

Greece's future in the euro appeared precarious on Friday as violence erupted on the streets of Athens after European leaders demanded that they deliver even deeper austerity.

A day after Greece claimed it had reached an agreement among its squabbling party leaders on new cutbacks, European officials dashed any hopes that the country is out of danger.

Finance ministers said more needs to be done and set a deadline for the middle of next week.

If Greece's government fails to meet Europe's demands, the debt-ridden country faces a chaotic debt default next month that would send shockwaves around the world economy and could doom a generation of Greeks to even deeper hardship.

If it does deliver those demands, Europe has committed to give it a 130 billion euro ($A160.76 billion) lifeline that would at least postpone Greece's day of reckoning.

"No disbursement without implementation," Jean-Claude Juncker, the Luxembourg premier who also chairs the eurozone's finance ministers' meetings, said on Thursday after they declined to fully back the deal Greek leaders had agreed.

EUROZONE WANTS DEEPER SAVINGS

The eurozone finance ministers want Greece to find another 325 million euros in savings and say parliament must to vote the austerity through.

Worried that Greek political leaders could later renege on the austerity promises, they also requested that the party heads commit to the measures even after general elections in April.

The fallout from the eurozone's demands was immediate in Athens.

Thousands of protesters marched through the streets to protest cuts including a 22 per cent reduction in the minimum wage.

George Karatzaferis, leader of the rightist LAOS party that is backing the government coalition, said he was withdrawing support for the measures agreed a day earlier, describing the country's treatment by its European partners as "humiliating".

Though LAOS is a small party, its action comes amid growing discontent country suffering a fifth year of recession and mired by frequent strikes and mass unemployment - nearly one in two young people are out of work.

POLTICAL UNCERTAINTY

LAOS has 16 deputies in the 300-seat parliament in a coalition backed by 252 MPs, posing no direct threat to the measures that are due to be voted late on Sunday and backed by the two major coalition parties, the Socialists and conservatives.

Faced with growing dissent, the Socialists and conservatives have both called emergency meetings of their parliament members following a cabinet meeting scheduled for 1600 GMT (0300 AEDT).

Karatzaferis insisted it was not his intention to withdraw from the government, and urged other countries in the European Union to challenge what he described as Germany's domination of the union.

"Of course we do not want to be outside the EU, but we can get by without being under the German jackboot," he told a news conference.

"Like all Greeks, I am very irritated ... by this humiliation."

HOODED YOUTHS

In central Athens, clashes erupted outside parliament, as dozens of hooded youths threw fire bombs and stones at police, who responded with tear gas.

Three people were hurt, police said.

The violence broke out as thousands took to the streets of the capital after unions launched a two-day general strike against the planned austerity measures.

Police said some 7000 people took part in the demonstration.

Another 10,000 Communist supporters held a separate, peaceful march.

Scores of youths, in hoods and gas masks, used sledge hammers to smash up marble paving stones in Athens' main Syntagma Square before hurling the rubble at riot police.

The country's two biggest labour unions stopped railway, ferry and public transport schedules, and hospitals worked on skeleton staff while most public services were disrupted.

Unions were planning protests in Athens and other cities around midday.

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