By Harry Papachristou
THESSALONIKI, Greece (Reuters) - Prime Minister George Papandreou offered no handouts to austerity-weary Greeks but gave some relief to companies struggling with recession in a speech on the economy on Saturday.
Tied by the conditions of a 110-billion-euro (90.0 billion pound) EU/IMF bailout deal to rescue Greece from bankruptcy, his Socialist government has imposed tax rises and draconian salary and pension cuts to fight deficits, prompting strikes and protests.
"We are fighting for the survival of Greece," Papandreou said in his annual economic policy speech at a trade fair in the northern city of Thessaloniki. "Either we'll win together, or we'll sink together."
About 20,000 protesters marched through the city to protest belt-tightening measures. A group of a few hundred youths tried to break through police lines cordoning off the venue and were pushed back with tear gas in clashes that lasted a few minutes.
Papandreou said his government will continue pushing reforms and opening up sectors of the economy such as electricity and freight transport and also overhaul loss-making state firms including Hellenic Railways (OSE).
"I ask all the country's productive forces to join us, to support this great change," he said.
He announced speeding up relief for corporations buckling under a deepening recession, bringing forward planned cuts in retained earnings tax to 20 from 24 percent in 2011 instead of 2014.
Opinion polls show his Socialist party ahead of the conservative opposition despite the harsh measures. A poll by Kappa Research for To Vima on Sunday, showed the Socialists would win 29.1 percent of the vote versus 21.3 percent for the conservatives if elections were held now.
(Additional reporting by George Georgiopoulos; Writing by Dina Kyriakidou; Editing by Janet Lawrence)
