Greek parliament OKs bailout deal; ECB boosts funds

Dani Vergou and Eric J. Lyman | Special for USA TODAY

Show Caption Hide Caption Greek Parliament holds fate of bailout plan in vote Greek Prime Minister Alexis Tsipras faces a Parliamentary vote today on the bailout agreement reached with European leaders as the International Monetary Fund voices new concerns over Greece's future debt levels.

ATHENS — After anti-austerity protesters clashed with police nearby, Greece's parliament early Thursday accepted harsh terms demanded by creditors to receive nearly $100 billion in the country's third bailout in five years.

The measure passed overwhelmingly, 229-64, despite three dozen defections from Prime Minister Alexis Tsipras' ruling Syriza party.

The vote — cast about two hours after the midnight Wednesday deadline — will allow Athens to receive a financial lifeline from its international creditors, but comes at a significant cost of higher taxes, deep cuts in pensions and other government benefits and the sale of most state assets.

After the approval, the European Central Bank agreed to increase the limit on emergency funding to Greece, supplying much-needed funds to the debt-strapped country.

The finance ministers from the eurogroup formally announced that talks can begin on a three-year bailout of Greece from Europe's bailout fund, the .

The bailout measure was approved after at least 10 separate protests and a general strike crippled the Greek capital Wednesday as demonstrators called for the government to reject the new rescue package or try to renegotiate for better terms from international creditors that include the European Central Bank, eurozone governments and the International Monetary Fund.

Clashes erupted outside the parliament building as lawmakers started to debate the measure late Wednesday. Anti-authoritarian protesters tossed Molotov cocktails at police, who responded with tear gas. More than 15,000 demonstrators attended the rally at Syntagma Square, where only a minority of the large group participated in the brawl.

About 40 protesters were detained by police, and the clashes died down shortly after debate got underway inside, but not before demonstrators set fire to garbage cans and damaged parked cars.

Tsipras' lobbied hard for passage as the only recourse to save Greece from an economic meltdown, even though a majority of his Syriza party came out against the bailout plan Wednesday. His leftist party was elected in January on a promise to oppose further austerity measures, but European government creditors stuck to their demands, and Tsipras said he had to capitulate.

Tsipras told parliament just before the vote, "The options I had during the 17-hour hard negotiations were specific: One was to accept an agreement with which I largely disagree, or a disorderly default."

The onerous bailout measure was approved Monday by eurozone leaders in Brussels after an all-night negotiating session. Parliament's passage Thursday helps secure Greece's future in the eurozone, the 19 nations that use the euro currency.

Panagiotis Lafazanis, the Greek energy minister, said Wednesday that even after parliament passes the plan, "the people will never accept it, and they will be united in their fight against it."

The IMF called for more debt relief for Greece late Tuesday, a move European leaders rejected at their weekend summit in Brussels. The IMF said the nation needs more time to pay off its massive debts, now exceeding $300 billion, and creditors may need to accept that some of its loans may need to be written off completely because the economically distressed nation has no hope of repaying them. It's already behind on billions in payments to the IMF.

The IMF's call for debt relief clashes with an assessment of Greece's debt burden published Wednesday by the European Commission, which appeared to rule out any relief. "Greece has already received more international financing than all of Europe did from the U.S. Marshall Plan after the Second World War," Commission President Jean-Claude Juncker said.

Leaders at the Brussels summit proposed giving Greece $7.7 billion in temporary financing to keep its banks afloat while the longer, three-year bailout deal is finalized.

At one of Wednesday's demonstrations, protesters said the government was stuck between a rock and a hard place.

"People are going to pay one way or another: either by being forced from the eurozone or through the implementation of these barbaric measures," said Ilias Sioras, 62, a cardiologist who noted that health care budgets already reduced by half could face further cuts.

Athina Lykouressi, 49, a nursery school teacher, said the spending reductions in the bailout plan were "destructive" for the nation's schools. "We can't feed our students," she said. "There has been a negative effect on equipment and education trips. Parents are called on to contribute financially, even as they are experiencing the effects of austerity themselves."

Greece has been on the brink of economic collapse since missing a June 30 debt payment with the IMF. Since then, banks have been closed, account holders have been limited to taking less than $70 a day from ATMs, and foreign money transfers have been blocked. Some stores are running out of imported items, and economists say the banking system is just days from insolvency.

The situation makes the austerity plan even more difficult, said Costas Pittas, 60, a public sector engineer who participated in a Wednesday morning rally.

"The new austerity measures are more than tough," Pittas said. "They come when the Greek people have been crushed by five years of austerity on top of more austerity. Five years ago we had some money to support our country. Today, we're completely dismantled as a society. They have taken everything apart. "

Eleni Thermou, 50, a nurse, said she would like to see the bailout plan rejected. "Conflict with the EU is the way to go," she said. "We should say no to ruthless taxation and devastating pension reforms."

Lyman reported from Rome. Contributing: Kim Hjelmgaard in London.