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Berlusconi, Sarkozy Discuss Italian Austerity Plan

Italy's Prime Minister Silvio Berlusconi reacts during a news conference at Chigi Palace in Rome on August 4, when he met with unions and employers to discuss his plans.
Italy's Prime Minister Silvio Berlusconi has outlined his government's austerity program, adopted to tackle the debt crisis facing the euro zone's third-largest economy, to French President Nicolas Sarkozy.

Berlusconi's office said in a statement that the Italian leader "explained to his counterpart the substance of the austerity plan approved August 12 by the cabinet and in particular underscored the manner in which the adopted measures will allow for the achievement of a balanced budget by 2013."

Meanwhile, the leader of Italy's largest union is threatening to hold a general strike in protest against the plan.

Susanna Camusso, the leader of the CGIL labor union, said a strike was the only way to "change the inequity" of the austerity measures.

The austerity measures -- a mix of spending cuts, job cuts, and tax increases -- were pushed through in response to demands made by the European Central Bank as Italy faced a looming debt crisis.

compiled from agency reports