HONG KONG: Asian shares were mostly higher Monday after Greek lawmakers approved a package of drastic austerity measures amid violent street battles between police and protesters in the streets of Athens.
The vote, which came as tens of thousands demonstrated against the unpopular cuts, was a key chapter in Greece's fiscal saga with lawmakers racing to secure a second bailout package, and avoid defaulting on its massive debt.
Tokyo was 0.18 percent higher in morning trade, Sydney climbed 0.34 percent, while Seoul jumped 0.49 percent.
Hong Kong also moved into positive territory, up 0.27 percent, as Shanghai shares drifted down 0.32 percent.
The euro rose on the budget cut deal reached early Monday, but the single currency's rise was tempered by uncertainty over implementing the austerity plan and ongoing talks between Athens and its private creditors.
"Greece's approval of austerity measures will bode well for markets but the tough stance of EU officials towards Greek austerity implementation means that focus will turn to yet another extraordinary meeting of European officials on Wednesday," said Mitul Kotecha, strategist at Credit Agricole.
"Even assuming that some form of a debt deal and second bailout package is ironed out, it is questionable how much the euro will rally as so much good news is already in the price," he told Dow Jones Newswires.
Eurozone finance ministers will meet Wednesday in Brussels to sign off on the deal necessary to a Europe-sponsored rescue package, followed by an offer to private sector holders of Greek government bonds.
The debtholders will be asked to exchange their existing bonds for new bonds with half the face value, chopping about 100 billion euros off Greece's 350 billion euro ($463 billion) debt mountain.
Greece must make the offer by Friday at the latest to complete its debt writedown -- and receive the fresh bailout package -- before a looming March 20 bond redemption, when the government must repay 14.5 billion euros.
Greek premier Lucas Papademos said that the deeply unpopular cuts must go ahead as the country races to pay its bills.
"A disorderly default would throw the country into a disastrous adventure. It would create conditions of uncontrollable economic chaos and social eruption," the prime minister said, as he appealed for calm.
Meanwhile, some protesters brandished homemade flame throwers, in addition to petrol bombs, as storefronts burned, with masked protesters trying to break through the riot police cordon around parliament where lawmakers were voting.
The civil protection ministry counted about 40 fires in Athens, while authorities said 54 people were injured in the day's events.
The austerity cuts include a 22-percent reduction in the minimum wage, labour market deregulation which would make it easier to lay off workers, and a package of tax and pension reforms.
In Tokyo, the government said Japan's economy shrank by an annualised 2.3 percent in the October to December quarter, weaker than analysts had expected, as exports faltered amid weak overseas demand, the strong yen and record flooding in Thailand.
In currency markets, the euro rose to $1.3230, from $1.3181 late Friday in New York, and to 102.72 yen from 102.47 yen.
The dollar bought 77.64 yen, edging up from 77.59 yen.
New York's main oil contract, light sweet crude for delivery in March, gained 70 cents to $99.37 a barrel. Brent North Sea crude for March delivery added 79 cents to $118.10.
Gold was at $1,725.60 an ounce at 0250 GMT, against $1,722.10 late Friday.
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