Demonstration as millions of striking Greek workers prepare to pour on to the streets tomorrow to protest against austerity measures aimed at ending a debt crisis

This article is more than 10 years old

This article is more than 10 years old

Militant trade unionists blockaded the entrance to the Athens stock exchange today as millions of striking Greek workers prepared to pour on to the streets to protest against austerity measures aimed at ending a debt crisis that has sent tremors through the eurozone.

The demonstration, by protesters affiliated to the communist party, came on the eve of a 24-hour general strike that is expected to bring Greece to a standstill.

Unions described it as yet another sign of the labour unrest the socialist government can expect from spending cuts they fear will deepen the country's recession.

"The measures call for low-income Greeks to carry the burden and no one else," said Giorgos Perros, one of the protest leaders. "We believe that stock market indices – gauges of wealth – should halt for a day."

The action coincided with a further blow for the Greek economy as the credit agency Fitch downgraded the ratings of the nation's four largest banks a notch from BBB+ to BBB.

It warned that the outlook for National Bank, Alpha Bank, EFG Eurobank and Pireaus Bank remained negative.

Explaining its decision, Fitch said the measures – announced in a bid to contain the crisis – would inevitably affect customer appetite for loans and hurt the banks' profits.

"[They] will have a significant effect on the real economy, affecting loan demand and putting additional pressure on asset quality," the agency said.

Analysts said the downgrade would make it harder for the banks to borrow money, and more expensive for the government to access loans.

Under pressure from markets and eurozone peers, prime minister George Papandreou has announced an ambitious program to slash the country's ballooning public sector deficit from 12.7% to just under the permitted EU level of 3% of GDP by 2012.

The deficit-cutting policies include a freeze on public sector salaries, a rise in the retirement age to 63 by 2015, the slashing of state bonuses, controls to tame widespread tax evasion and higher levies on fuel, alcohol and luxury goods.

Greece has been given until mid-March by the EU to prove the measures are effective. Eurozone finance ministers have already warned that tougher austerity measures may have to be taken if progress is deemed insufficient.

In an indication of the close monitoring Athens can expect, a team of officials from the European commission, European Central Bank and the IMF arrived in the Greek capital today to start a three-day surveillance tour.

The visit came as Olivier Blanchard, the head of the IMF, warned that Greece was among the European countries that faced up to 20 years of "extremely painful" belt-tightening.