MADRID - The leader of Spain's largest union will call a public sector workers' strike in response to wage cuts aimed at cutting Spain's deficit back to EU guidelines and appease markets, but is likely to stop short of a full general strike.
The Comisiones Obreras union is one of Spain's main unions meeting with Prime Minister Jose Luis Rodriguez Zapatero from 1130 GMT to discuss an austerity plan announced on Tuesday and likely to worsen the climate in which crucial labour reform talks take place.
"This afternoon we will call a meeting ... which will lead to a public sector strike," said a CCOO spokesman.
Unions considered demonstrations on Tuesday after Prime Minister Jose Luis Rodriquez Zapatero told parliament the government planned to cut civil service wages by 5 percent this year and freeze them in 2011.
A wider union protest appears unlikely after remarks by Ignacio Fernandez Toxo, the general secretary of Comisiones Obreras
"It (a general strike) is the last thing this country needs at a time like this," Toxo told private broadcaster Punto Radio.
"Decisions that serious, in case they are taken, need to be carefully thought over," he added.
Talk of a general strike has threatened Zapatero's government on several occasions, although analysts question the extent to which the public would respond to such a measure.
"At most a general strike, which I don't think is probable, would be a gesture on the part of the unions to save face. But it wouldn't have massive support from the public," said a Spanish economist who declined to be quoted. "It certainly wouldn't be anything like what we have seen in Greece."
Three people were killed during protests and strikes in Greece which brought tens of thousands of people onto the streets following the announcement of tough austerity measures by the government.
Toxo said he would wait until the cabinet gave more details of the cuts at a weekly meeting on Friday.
"People may take account of the fact that proposals could have another outcome," he said.
The Madrid bourse fell 1.3 percent .IBEX amid market concern over possible delays by the government in applying the proposed austerity measures.
"Zapatero's unveiling measures was fine, but the actual situation in Spain is still difficult and foreign investors don't want to know about us, and hedge funds are very active," a trader said.
"What the market demands is that these measures take effect forthwith," she added.
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