EU says Greece making progress, must stick to bailout

(BRUSSELS) - As Greece was hit Tuesday by yet more public sector strikes against government austerity, the EU insisted the unpopular policy is showing results and must be pursued to the end.

European Commission President Jose Manuel Barroso said that after huge sacrifices, there is "light at the end of the tunnel," with twice-bailed out Greece set to return to growth next year.

"This is no time to take our hands off the wheel, full implementation is essential," Barroso said alongside visiting Greek Prime Minister Antonis Samaras.

Greek doctors joined the latest wave of strikes Tuesday, with thousands of public sector workers protesting against government plans for job cuts and redeployments.

Teachers from schools and universities, civil servants and lawyers are also on strike in protest at reforms Samaras has pushed through as part of the country's bailout programme.

All of Greece's other public sector unions will embark on a two-day strike Wednesday and Thursday.

Overall, Greece has pledged to axe 4,000 state jobs and redeploy 25,000 public sector workers by the end of the year, in return for its much-needed rescue loans.

Samaras said that after six years in a deep and damaging recession, Greece was finally turning the corner, with public finances set to show a primary surplus if debt and interest payments are excluded.

"Today there is no more talk about the infamous 'Grexit,'" Samaras said, referring to the possibility the country would leave the eurozone as it failed to meet its bailout targets.

First rescued in 2010 by the Troika of the European Union, the European Central and International Monetary Fund, Athens soon needed a second, bigger bailout which included a controversial write-down of some 100 billion euros in private creditor debt.

Asked about widespread speculation Athens will need a third rescue, Barroso said "it is no secret we have to look again at Greece's financial needs," estimated by the IMF at another 11 billion euros in 2014 and 2015.

Barroso said maintaining confidence in Greece was vital to success, adding he could not comment in detail until a Troika review team reports back on the state of the economy.

He said he recognised the pain caused by the austerity policy which had to be "front-loaded" in bailed-out countries because they "were very close to insolvency."

Now the emphasis should be on "growth friendly" structural reforms," he said, arguing that reducing a bloated public sector or ensuring an equitable tax system were justified in the cause of "social fairness."

Neither Samaras nor Barroso directly referred to the strikes in Greece.