Spanish unions condemn new austerity measures

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Major unions in Spain condemned tough new austerity measures announced Wednesday by the Socialist government, which they charged had "folded" under pressure from the markets and the EU.

Prime Minister Jose Luis Rodriguez Zapatero ordered a five percent pay cut for public workers and said pensions except for the poorest will also be frozen in 2011, as part of the moves aimed at slashing the public deficit.

The measures mark "a major change of attitude by the government" in confronting the economic crisis, said the secretary general of the CCOO union, Ignacio Fernandez Toxo.

"The EU has forced the government to fold in the face of a speculative financial market which has got us in a vise and (the government) has not been able to react with more decisive measures" in time, he told Radio Cadena Ser.

Asked about a possible general strike, he said he had "not excluded this hypothesis," but added he would study the measures and speak with the other major union, the UGT.

Candido Mendez, the head of the UGT, which is close to the governing Socialist Party, said the measures "indicate a change in the dynamic of relations with union organisations."

In January, Spain introduced a 50-billion-euro (63-billion-dollar) austerity package designed to slash the deficit to three percent of GDP by 2013 from 11.2 percent last year.

But it moved to introduce additional measures worth 15 billion euros over two years following speculative attacks on the euro last week.

Spain's credit rating was cut by Standard and Poor's last month and it has been named along with Portugal as possible new weak links in the euro zone as Greece battles its debt crisis.

The pay cut announcement came as Spain became the last of Europe's big economies to emerge from recession, with the government announcing fragile growth of 0.1 percent in the first quarter.

© 2010 AFP

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