Greece, Spain up for more austerity despite violence

But one of the three leaders, Fotis Kouvelis, said there were still some "outstanding issues", without giving any details. Centre-right Prime Minister Antonis Samaras has struggled to convince his two junior coalition partners from the left to agree to more wage and pension cuts.

Popular anger against the cuts turned violent on Wednesday as over 50,000 gathered in Syntagma square with riot police firing tear gas on protesters. A general strike also paralysed transportation into and throughout the country, as well as hospitals and schools.

Similar violence erupted in Spain ahead of a fresh set of spending cuts the government was set to approve later on Thursday.

Spain is under a 'light' bailout of €100bn for its banking sector but is expected to ask for more financial assistance soon, as the recession is worsening and unemployment has hit 25 percent, the highest in Europe.

"The violent images from Spain and Greece prove that this violent austerity inevitably leads to social tension," Greek leftist leader Alexis Tsipras said Thursday during a press conference in the European Parliament in Brussels.

Greece will inevitably need to have a second and possibly even a third debt restructuring, according to Tsipras, unless EU leaders agree to slash all its debt and give some "breathing space" to the economy.

Tsipras said this could be done with a "debt conference" as happened for Germany after the second World War, when 60 percent of the country's debt was pardoned and the rest had to be repaid once the economy the started growing.

He criticised the current Greek government for having promised to re-negotiate the terms of the bailout only to agree to all prescribed austerity measures a few months later.

"It is a dead end, a vicious circle of austerity, recession, deficit and debt. Greece's gross domestic product has shrunk by 20 percent from the beginning of the crisis. This is unprecedented in a country where there is no war."