Friday, April 23, 2010

Romanian Teachers Strike Over IMF - Driven Pay Cuts

BUCHAREST (Reuters) - Romanian teachers staged a one-day general strike on Thursday to protest over pay cuts and mass layoffs in the public sector needed to keep spending within terms of an IMF-led rescue deal.

The government of Romania, the European Union's second poorest country, put a vital 20-billion-euro (18 billion pounds) International Monetary Fund aid deal back on course earlier this year by promising to cut spending, including axing tens of thousands of public sector jobs.

An IMF mission will be in Bucharest from April 27 to May 7 to review the aid package.

Education unions, which threaten to launch an indefinite strike from later this year, say 15,000 jobs are to be chopped from the sector, which is seen as inefficient and outdated.

"If our demands will not be met, we will hold a national strike for an unlimited period starting the first half of June," Marius Nistor of the Spiru Haret union told Reuters.

"The ones who believe they will get more money by going on strike are wrong," Prime Minister Emil Boc said. "The government holds on to its stance of rationalising public spending."

Public workers have said they plan a series of strikes, piling pressure on the four-month-old centrist government trying to claw its way out of recession with painful cuts.

But analysts warn mounting social unrest at times of painful recession could make Bucharest more prone to making concessions that may restrain any financial reforms.

The country's public sector employs 1.3 million workers, a third of all jobs. Its payroll swallows 9 percent of GDP and analysts say the cost is twice as high as it should be.

The IMF has revised a previous 2010 growth estimate for Romania of 1.3 percent to 0.8 percent. The economy contracted by 7.1 percent in 2009, one of the worst declines in the EU.

Romania is under pressure from lenders to carry out long delayed reforms regarded by analysts as critical to chances of convergence with fellow EU members.

(Reporting by Ioana Patran; Editing by Mark Heinrich)

No comments: