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Greek unions call 48-hour strike to protest planned cuts

By the CNN Wire Staff
STORY HIGHLIGHTS
  • NEW: Parliament vote on austerity measures pushed back to Wednesday
  • Situation in Greece expected to dominate European leaders' summit in Brussels, Belgium
  • The strike is due to take place next week, with a rally outside Parliament on the first day
  • The economic crisis has prompted rioting in the streets of Athens in recent weeks

Athens, Greece (CNN) -- Greek unions have declared a 48-hour general strike next week to protest new austerity measures set to be voted on by the Greek Parliament, one of Greece's biggest umbrella unions told CNN on Thursday.

The strike will take place Tuesday and Wednesday, the General Confederation of Workers of Greece said. A rally is planned for Tuesday that will end outside the Parliament building.

Greece's Parliament is due to vote Wednesday on a tough five-year package of tax increases and spending cuts, a day later than originally planned.

The austerity measures must be passed if Greece is to win the last $17 billion portion of a $156 billion bailout package from other European nations that was granted in 2010, and also to clear the way for another potential bailout package to keep Greece afloat going forward.

Saving Greece from financial ruin
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The unions' call for strike action comes less than two days after Prime Minister George Papandreou and his reshuffled Cabinet survived a vote of confidence amid widespread public opposition to further austerity moves.

The economic crisis has inspired rioting in the streets of Athens in recent weeks, where protesters have thrown firebombs and clashed with armored police.

The Greek crisis is expected to dominate discussions among European leaders, including Papandreou, at a summit opening in Brussels, Belgium, later Thursday.

Next week's parliamentary vote will be followed by a meeting of European Union finance ministers on July 3 to approve the final part of funding from last year's bailout.

Greece needs that money to avert a default on debt repayments that are due as soon as mid-July.

Such a default would send shock waves through the European banking sector and potentially dent global economic confidence.

Speaking at a news conference Wednesday, U.S. Federal Reserve Chairman Ben Bernanke said that while the United States had limited exposure to Europe's debts, "a disorderly default in one of those countries would no doubt roil financial markets globally."

International lenders have insisted Greece cut spending, lay off public workers, raise taxes and raise 50 billion euros ($71 billion) through selling off state-owned enterprises in exchange for a further bailout of the cash-strapped nation.

The latest demands follow austerity measures imposed last year that included pension cuts; a sales tax boost; excise taxes on fuel, cigarettes, alcohol and luxury goods; and a rise in the average retirement age to 65 from 61.

CNN's Elinda Labropoulou contributed to this report.

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