Lisbon Protests: More Than 100,000 Rally Against Austerity In Portugal

More Than 100,000 People Protest Against Austerity In Portugal

* Organisers claim 300,000 took part

* More protests against bailout austerity on Feb. 29

* EU/IMF inspectors arrive on Wednesday

By Andrei Khalip

LISBON, Feb 11 (Reuters) - More than 100,000 people packed Lisbon's vast Palace Square on Saturday in the largest rally against austerity and economic hardships since the country resorted to an EU/IMF bailout last May, and organisers vowed to step up protests and labour action.

The mass rally occurred just four days before Portugal's international lenders were due to start the quarterly evaluation of the bailout implementation on Wednesday in the finance ministry building which overlooks the square by the river Tagus. They come amid concerns Portugal may need more bailout funds, if not a debt restructuring like Greece.

"We take this opportunity here to make our own evaluation on behalf of those who suffer daily," Armenio Carlos, head of the country's largest union, CGTP, told supporters as the crowd chanted: "IMF doesn't call the shots here!"

"We have to step up the struggle," he said. Carlos promised the next wave of rallies across Portugal as soon as on Feb. 29.

"The country needs to remove the rope from around its neck," he said, saying that Portugal should try to renegotiate its debt rather than impose more austerity, an argument he has made consistently.

The peaceful rally under the banners of the 750,000-strong CGTP, which last month refused to sign a pact with the government on labour market reform, showed that social strife is running strong and likely to grow even though other unions agreed to the reforms demanded by the bailout terms.

Spending cuts and tax hikes needed to meet the fiscal terms of the bailout have caused the worst recession in Portugal since the few turbulent years that followed the 1974 return to democracy. Unemployment is at a record of around 13 percent.

"The bailout is good for the creditors who get billions in interest and commissions, good for the banks ... But the measures are really bad for the workers, youths, pensioners, for 2.7 million Portuguese on the verge of poverty and those already below the poverty line," he said.

CGTP said the rally was the largest in the past 30 years and brought together some 300,000 people, but it is not unusual for the unions to exaggerate the numbers. Police would not provide estimates. Many of the protesters came from other cities in dozens of buses organised by CGTP.

Some of the placards carried by demonstrators read: "Against exploitation and impoverishment! Another policy is possible and necessary!"

"They are stealing the salaries and the rights we had. They are stealing from the poor to give to the rich. I'm poor and I have to protest. The more we stay quiet, the more they rob," said Jorge, one of the protesters in his twenties.

Portugal's debt crisis has so far failed to provoke the scale of labour protests seen in Greece. There have been two general strikes in the past two years and workers in transport and other sectors have staged regular stoppages.

Compared to some other European countries, protest rallies have been few and peaceful, though large in numbers.

But analysts say there could be more unrest as some of the government's most stringent austerity measures come into effect this year. Tax hikes and cuts, including the elimination of two months' of civil servants' wages, have already sent the country into its deepest recession since the 1970s.

Still, the head of the second-largest union, which signed the labour reform pact, said at the time it would significantly decrease the likelihood of social strife spiralling out of control in Portugal.

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