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Greek protesters clash with police at US Embassy

By Nicholas Paphitis

Associated Press

Published: Thursday, Nov. 17 2011 12:20 p.m. MST

Protesters use burning trash bins as barricade during minor clashes in Athens, Thursday, Nov. 17, 2011. Masked youths clashed with riot police outside Greece's parliament and the U.S. embassy in Athens Thursday as some 28,000 austerity-weary Greeks marched in an annual commemoration of a bloody student uprising in the 1970s. Seven thousand officers were monitoring the crowd.

Thanassis Stavrakis, Associated Press

ATHENS, Greece — Masked youths clashed with riot police outside Greece's parliament and the U.S. embassy Thursday as thousands of austerity-weary Greeks marched through Athens in an annual commemoration of a bloody student uprising in the 1970s.

Police fired tear gas and stun grenades to disperse the rioters, and some 78 people were detained for questioning. Eleven people were arrested. Police also reported four injured police officers. A young protester was reportedly hospitalized after injuring both legs in an attempt to evade police.

Some 28,000 people took part in the march, according to police estimates, making it one of the biggest Nov. 17 protests in years. Seven thousand officers were monitoring the crowd.

With loan-dependent Greece heading for its fourth year of recession and saddled with record unemployment, the demonstration was the first test of public sentiment for the new coalition government of Lucas Papademos, a technocrat enjoying widespread popularity, according to polls.

Thursday's annual protest commemorates the squashing of a pro-democracy student uprising in 1973 by the military dictatorship that ruled Greece from 1967-74 — and whose backing from the U.S. still rankles in the country. But the embassy march has traditionally served as a vent for anti-government protests that often turn violent.

About 15,000 people took part in a similar protest in the northern city of Thessaloniki that turned violent when a couple of hundred anarchists threw projectiles and petrol bombs at police, who responded with tear gas. No injuries have been reported.

The clashes come a day after Papademos, a 64-year-old former central banker, easily won a confidence vote in parliament.

Papademos heads a coalition of the majority Socialists, conservative New Democracy and the small right-wing populist LAOS party, which has nationalist and anti-immigration roots.

He faces a daunting task in the 100 days until early elections in February. As well as staving off looming bankruptcy by securing the country's next rescue loan installment, his government must pass a new austerity budget — to be tabled in parliament Friday — and transform paper pledges of sweeping public sector reform into action.

After its borrowing costs ballooned in 2010, Greece turned to its European partners and the International Monetary Fund, winning a €110 billion ($148 billion) bailout in return for deeply resented austerity measures to cut deficits bloated by years of government overspending.

But it became clear that the rescue loans were not enough, and European leaders agreed on a second €130 billion ($175 billion) bailout last month with an additional €100 billion ($135 billion) debt writedown by banks and other holders of Greek government bonds. Complex talks with the Institute of International Finance, a global bank lobbying group, on the writedown started in Athens Wednesday and will continue over the days and weeks ahead.

The details of the bond swap will determine how much the deal will actually help Greece in getting its debt down to a sustainable level.

"Our goal is to structure a transaction that will attract the broadest possible support from the bondholder community," Finance Minister Evangelos Venizelos said. "To this end, we will be listening to the IIF, other industry bodies and individual creditors' ideas about how best to design this transaction."

IIF officials said that they were committed to the 50 percent writedown on the face value of the Greek bonds, but much depends on the rate of interest Athens will have to pay on the remaining debt.

IIF managing director Charles Dallara said the creditors who met in the headquarters of Deutsche Bank in Frankfurt on Thursday included big banks, insurers, asset managers and hedge funds, representing some 70 to 80 percent of Greek debt that is still in private hands. Making the terms of the bond swap attractive enough will help get participation up to the promised 90 percent, he added.

The Greek government's most pressing task is to secure the release of an €8 billion ($11 billion) loan installment — frozen by the EU as it awaits written commitments from all parties in the new coalition that they will honor the terms of the new debt agreement after the next election.

Greek conservatives have balked at the demand, despite warnings the country will default before Christmas without the money, leaving Papademos to seek a compromise with the European Union.

He will meet with top EU officials in Brussels on Monday, a day before flying to Luxembourg to meet Prime Minister Jean-Claude Juncker, who chairs meetings of eurozone finance ministers.

Gabriele Steinhauser in Brussels, Demetris Nellas in Athens and Costas Kantouris in Thessaloniki contributed to this report.

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