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Portuguese transport workers strike over austerity

November 8, 2011

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LISBON, Portugal—A strike by Portuguese public transport workers shut down national train services and the Lisbon subway Tuesday in the latest major protest against austerity measures designed to reduce the country's crippling debt burden.

Staff at the state-owned rail company Comboios de Portugal and the Lisbon subway walked off the job during the morning rush-hour. Bus and ferry workers were also due to stop work later in the day.

The center-right government is locked into a program of pay cuts and tax hikes in return for a euro78 billion ($107 billion) bailout Portugal needed earlier this year to avoid bankruptcy.

The government is also curtailing workers' entitlements in an effort to make the economy more competitive. The country went into a double-dip recession this year, and the economy is forecast to keep contracting through 2012 when the unemployment rate is predicted to reach a record 13.4 percent.

The austerity measures, and plans to rationalize loss-making public transport companies, have angered trade unions. Portugal's two main trade union confederations also plan a general strike Nov. 24.

The government says public transport companies together have debts amounting to euro17 billion -- around 10 percent of annual gross domestic product -- and are on the verge of financial collapse.

Public transport has long been heavily subsidized in Portugal, one of western Europe's poorest countries where the average monthly salary is around euro900 a month before tax.