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Greek police battled demonstrators on Thursday as the country ground to a halt in the latest protest strike against government austerity measures aiming to end a crippling debt crisis.

Violence erupted in the capital with riot police firing tear gas at hooded youths who hurled firebombs and vandalised stores near parliament.

There were clashes in other parts of Athens where masked youths threw firebombs and stones at police and burned a car, before security forces fired back more tear gas.

Youths from a 300-strong anarchist group attacked police and vandalised a dozen stores in the area near the Athens Polytechnic, police said.

Small groups smash store windows in the main Omonia Square after the end of two demonstrations that drew many thousand participants. Five people were detained, a police source said.

In the northern city of Thessaloniki, protesters threw eggs and yoghurt cartons stolen from a supermarket at a government building, police said.

Unions called out more than one million people on strike in the latest challenge to draconian spending cuts by the Socialist government aiming to reduce the public deficit of 12.7 percent of output and a debt mountain of nearly 300 billion euros (410 billion dollars).

The stoppage crippled public transport and closed schools, hospitals and government offices in the capital.

Several thousand gathered in the separate demonstrations, holding banners blasting the socialist government and the European Union, which is pressing for even tougher measures.

"Even if they terrorise us, the measures will not pass through," one banner proclaimed. Another said: "We are men, not numbers."

The strikers shouted: "Europe must change or it will sink" and "War with capitalists, that's the response of the workers."

No buses or trams ran and only one underground train line was operational in the capital. Health centres treated only emergencies.

Air traffic controllers walked off the job at midnight and ships were anchored as port workers joined the strike call by two powerful unions.

The national news agency ANA stopped its tickers and newspaper staff stopped work. Tax collectors have been on strike all this week.

Christos Fotopoulos, head of a police union, told AFP officers were taking part in rallies in uniform as "the governmental measures are painful and they erase bonuses which account for 50 percent of our salary."

Uniformed police and firefighters won sustained applause from bystanders.

Similar protests last Friday, as parliament pushed through the latest 4.8 billion euro austerity package, also degenerated into clashes between police and demonstrators.

A one-day general strike on February 24 shut schools, government offices and courthouses, also causing major disruption to public transport, banks, hospitals and state-owned companies.

Prime Minister George Papandreou received support from an unexpected source Wednesday when the head of the country's employers federation came out in support of the austerity measures.

"Between bankruptcy and recession, between the devil and the deep blue sea, there is no other alternative to the abyss," employers chief Dimitris Daskalopoulos told reporters.

Tax hikes and spending cuts were "inevitable after many years of negligence," he said, denouncing protesters who he said were protecting their own interests at the country's expense.

In Washington on Tuesday, Papandreou called on US President Barack Obama to crack down on speculators he said were trying to undermine Greece's battle out of the debt crisis.

The Greek economy, which is mired in a recession, ran into more trouble on Tuesday when the national statistics agency reported the annual inflation rate jumped to 2.8 percent in February.

But there was better news from the central bank which reported Wednesday that budget receipts rose for the second straight month in February.

AFP