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ECB besieged by protests as Draghi fetes US$1.4b tower

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Anti-austerity protesters seeking to spoil the inauguration of the European Central Bank's new headquarters in Frankfurt's east end set vehicles alight, erected barricades and left a trail of destruction across the city.

[FRANKFURT] Anti-austerity protesters seeking to spoil the inauguration of the European Central Bank's new headquarters in Frankfurt's east end set vehicles alight, erected barricades and left a trail of destruction across the city.

Police deployed water cannons to restore calm and keep the demonstrators at bay in the area surrounding the 1.3 billion- euro (US$1.9 billion) tower, after setting up barbed wire and road blocks.

"European unity is being strained," ECB president Mario Draghi said at the inauguration ceremony on Wednesday. "The ECB has become a focal point for those frustrated with this situation. This may not be a fair charge - our action has been aimed precisely at cushioning the shocks suffered by the economy - but as the central bank of the whole euro area, we must listen very carefully."

The police estimated about 10,000 protesters would descend on the currency bloc's financial capital and home of the common currency under the Blockupy banner, and several thousand police officers are on duty. Demonstrations and sit-ins are planned at several locations throughout the city by groups and organizations sympathizing with the plight of Greece.

The first incidents occurred "shortly after 6 am," said Claudia Rogalski, a police spokeswoman. "There have been violent outbreaks at several locations in which police have been attacked." Eight police officers were injured in the altercations, she said.

Rioters set several cars, including seven police vehicles, and garbage containers alight, set off smoke bombs and threw stones, glass and corrosive substances, police said in Twitter postings. Some arrests have been made, the police said, without providing a number, and have detained about 350 people "who prior to this rioted and committed criminal acts." Laying Blame Protesters said police deployed tear gas.

"We were moving toward the ECB and then tear gas cartridges were fired from the police lines," said Martin Dolzer, a member of the Left party from Hamburg. The smoke "spread over a broad area; it was a very strong irritant." Police are equipped with pepper spray and it's possible they used the substance in defense, said Rogalski.

Nine days after the ECB started buying sovereign debt in a 1.1 trillion-euro plan to revive inflation and rescue the economy, protesters are laying the blame for recession and unemployment in the 19-nation euro area at the doors of Draghi and German Chancellor Angela Merkel.

A new government in Greece, led by the leftist Syriza party, is preparing emergency measures to raise cash as the country braces for more than 2 billion euros in debt payments on Friday. The country is unable to access bailout funds as it haggles with euro-area governments over the terms of its aid program. Its lenders have been cut off from regular ECB finance lines and pushed onto emergency credit from the Greek central bank.

"In the past, we protested against things like the rescue of the banks in Europe," Werner Renz, a representative of protest group Attac, said on Tuesday. "The focus of our protests this year is on Greece. We need more of Athens in Europe and less of Berlin. There is no way Greece can repay all its debt. The situation can't be solved by austerity alone." The inauguration ceremony includes guests such as Frankfurt Mayor Peter Feldmann and Tarek Al-Wazir, economy minister of the German state of Hesse. The ECB's 25-member Governing Council is also scheduled to hold a non-monetary policy meeting where Greece will be on the agenda. The central bank plans to be fully operational, a spokesman reiterated on Wednesday.

Draghi said that with some protesters arguing that Europe is doing too little and populist parties saying it is doing too much, the answer lies in further, though pragmatic, integration.

"The answer is not to unwind integration, nor is it to hold out an unattainable vision of where integration should lead," he said. "It is to complete our monetary union in the areas where it can and needs to be completed." Dozens of groups, including Syriza followers, are joining in the rally. The demonstrators was planned to blockade the area around the ECB in "transnational actions of civil disobedience," Blockupy said on its website. The ECB issued guidance to staff on dressing to avoid drawing attention.

"Expansive monetary policy serves the financial markets and the wealthy first and foremost," Sahra Wagenknecht, a lawmaker for the Left party in the Bundestag in Berlin who will address the crowds, said in an e-mail. "The money doesn't reach the real economy as investment." A rally outside the city hall at the Roemerberg, Frankfurt's medieval square, is scheduled to run from 2 pm to 5 pm, ending with a march through the city to the Alte Oper near Deutsche Bank AG's headquarters into the evening. Some public transport services will be disrupted or diverted, and traffic will be rerouted.

"We are monitoring the situation and are informing our employees," Klaus Thoma, a Deutsche Bank spokesman, said by phone from Frankfurt on Tuesday.

Protesters in November scaled fencing at the ECB's headquarters and hurled paint bombs at the glass facade while trying to gain entrance to the building after a small group of about 2,000 demonstrators taking part in an organized rally broke away. The organizers called an end to that march after the incident.

While social unrest is relatively rare in Germany, Europe's biggest economy has been the scene of several mass protests in recent months as a wave of anti-immigration sentiment sparked demonstrations by the Pegida movement opposing what it calls the Islamization of Europe. The biggest of these attracted as many as 25,000 people in the eastern city of Dresden in January.

In October, more than 4,000 soccer hooligans and neo-Nazis raged through the streets of Cologne, hurling bottles and stones at police, in a protest rally that spiraled out of control. Traditional May Day protests, to mark the May 1 Labor Day, frequently erupt in violence.

The police are required to strike a balance between protecting citizens and upholding the freedom of assembly rights anchored in Germany's constitution.

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