THESSALONIKI - Greek Prime Minister Alexis Tsipras on Saturday vowed to lead his country to a post-bailout "rebirth" after eight years of cuts, offering millions of euros in handouts and promising to cut taxes and raise the minimum wage to bolster economic recovery.

"We know we have the strength and the knowledge to envisage, plan and accomplish our country's rebirth," Tsipras said in a broad speech at the Thessaloniki International Fair, where economic policy for the coming year is traditionally announced. "Higher wages, labour market regulation and respect for labour rights...are a prerequisite for growth," the leftist leader said. "The Greek economy is stabilised...we are a normal country now," he said.

With "at least" 3.5 billion euros ($4.1 billion) in fiscal room, Tsipras pledged to cut property and sales tax, boost the income of hundreds of thousands of farmers and middle-class Greeks and reconsider a planned 2019 pension cut agreed with Greece's creditors earlier this year.

Greece is committed to a primary budget surplus -- not counting debt repayments -- of 3.5 percent of GDP through 2022, and 2.2 percent through 2060, with average economic growth of three percent a year. Tsipras on Saturday said his administration was "absolutely certain" that the 2019 target can be achieved without the unpopular pension cut.

Once the data is verified for the October budget "we will explain to our European peers...that this measure is not only fiscally unnecessary. It is not structural and impairs growth," the PM said. Business tax will also gradually be scaled back from 29 percent to 25 percent by 2022, he said.

"It is the least we can do to mend wounds, reduce great burdens and create a growth dynamic in the Greek economy," Tsipras said, stressing that the handouts were "within the framework" agreed with creditors.

The 44-year-old is trying to bounce back from his lowest ratings since coming to power which have been exacerbated by Greece's worst fire tragedy in July in which nearly 100 people died near Athens.

Elections are not scheduled for another year but there is speculation a snap ballot could be held by May.

Ahead of Tsipras' speech, more than 16,000 people demonstrated against the government's economic policies and in opposition to a controversial planned name deal with neighbouring Macedonia. Riot police fired tear gas at around 100 flare and stone throwing demonstrators.

'Austerity is not over'

The protesters, many of whom were waving Greek flags, were shouting "Greece, Greece, Macedonia" and "traitors". They also hurled insults at Tsipras and demanded he resign. Opposition parties and unions dispute that the end of Greece's third bailout last month leaves much cause for celebration. "(Greeks) believe that austerity is not over.

All that has ended is the obligation of creditors to give the country money... and a tough tutelage remains," said Yiannis Panagopoulos, head of Greece's leading union GSEE.

Unemployment has fallen below 20 percent for the first time since 2011, but most Greeks continue to struggle under heavy taxation and drastically reduced income.

The preliminary agreement with Macedonia in June, to be confirmed by a referendum by Skopje later this month and a Greek parliamentary vote early in 2019, will see the Balkan state renamed North Macedonia.

The tiny landlocked country had joined the United Nations in 1993 as the Former Yugoslav Republic of Macedonia.

Greece also has a northern province named Macedonia, the heart of Alexander the Great's ancient kingdom, and many Greeks fear the deal will officially enable Skopje to lay claim to their cultural heritage.

Tsipras on Saturday insisted that Thessaloniki should act as a "cultural bridge, not a fence."

"Thessaloniki does not deserve misery, intolerance, fear, hatred and discord," he said as he promised to donate state land for a new stadium for PAOK, the city's most popular sports club.