The Greek parliament has approved the first step in sweeping new austerity measures aimed at securing international financing for the debt-ridden nation.

Socialist Prime Minister George Papandreou won passage Wednesday of his $40 billion plan to increase taxes, cut spending and sell state-owned assets. The plan was approved on a 155-to-138 vote, a wider than expected margin.

Lawmakers voted to pass the legislation as thousands of rock-throwing protesters opposed to the deal clashed with police for a second day in the streets outside the parliament building in central Athens. Police fired tear gas at the protesters and white smoke filled the square outside parliament.

One group of protesters set fire to a post office on the ground floor of the nearby finance ministry. Demonstrators threw water bottles and taunted one Socialist lawmaker who said he would vote against the austerity measure but then did not.

With the austerity measure approved, Greece moved closer to collecting a $17 billion share of last year's $156 billion bailout from the International Monetary Fund and the European Union. Without passage, Greece likely would have defaulted on its financial obligations as early as July, which could have, in turn, led to calamity on European and world financial markets.

As the lawmakers neared a vote, Mr. Papandreou made a last-minute appeal for support. He implored parliament to do everything to avoid default. Lawmakers will next vote Thursday on the details of the austerity plan, some of which could be opposed even by those who voted Wednesday to approve the overall plan.

Key European leaders praised the Greek legislative action, calling it a vote of “national responsibility.” The president of the European Council, Herman Van Rompuy, and the president of the European Commission, Jose Manuel Barroso, said a second favorable vote Thursday would lead to disbursement of the $17 billion from last year's bailout.

Even if the IMF and EU release the $17 billion, Greece plans to seek more international assistance, a second bailout about the same size as last year's.

Workers in Greece are in the second day of a 48-hour general strike, and the country is all but shut down by the protest action against the new round of austerity reforms.

Some 20,000 demonstrators gathered in Athens on the first day of the general strike Tuesday. Initially peaceful, the protest turned violent. At least 4,000 police officers armed with stun guns, tear gas and batons fought protesters who hurled rocks and firebombs.

Many protesters feel the $40 billion austerity plan will impose harsh penalties on workers and pensioners, while sparing the wealthy.

EU officials had warned that Greece had no choice but to adopt the austerity plan.