The decision by conservative Prime Minister Antonis Samaras to declare ferry crews under civil mobilization came after their unions voted to extend the strike until early Friday. Seamen who refuse to comply risk arrest and jail time of up to five years—although a union leader said workers would try to defy the order.
Samaras' three-party coalition government is facing a strong backlash from unions over new austerity policies forced upon it by international creditors, whose bailout loans are shielding debt-heavy Greece from bankruptcy.
The country's main unions have called a general strike for Feb. 20.
Merchant Marine Minister Costas Mousouroulis said the government did what it could to address seamen's demands for payment of salaries more than six months in arrears and the signing of collective work contracts with ferry companies.
"Unfortunately, arteriosclerotic and petty political views prevailed, not allowing (the end of the strike) so that our islands could regain their only means of communication with each other and the mainland," Mousouroulis said.
Samaras' government had previously hinted heavily that it would mobilize the seamen unless they stopped the strike. The rarely-invoked order was also issued last month to end a protracted walkout by Athens underground rail workers.
The Merchant Marine Ministry said ferry schedules could resume later Tuesday, depending on how fast strikers are served their mobilization papers.
But seamen's union leader Yiannis Halas urged ferry crews to resist.
"(The mobilization) will solve none of our problems," he told a protest gathering of about 1,500 seamen and supporters in the capital's port of Piraeus, Greece's largest. "We ask the crews to stay away from their ships and stay here. Courage and strength to all of us."
The strike has already had an impact on islanders, many of whom rely on the mainland for basic everyday supplies. An island trade and commerce association warned that the seamen's walkout poses a substantial threat to small businesses in the archipelago, which already face severe pressure due to Greece's three-year financial crisis.
The Cyclades chamber of commerce said Tuesday that the strike had led to shortages in goods, prevented treatment of serious health cases and even stopped the transportation of dead bodies for burial.
"We demand that you understand, and this is no overstatement, that the limits of what we can bear and tolerate have been exceeded," a statement said.
In a separate statement, the country's national trade federation warned that the strike had left large numbers of trucks loaded with goods trapped in the country's main ports.
The civil mobilization law, amended in 2007 to deal with "peacetime emergencies," has now been used ten times since the 1974 collapse of a military dictatorship in Greece—three of those in anti-austerity strikes over the past two years.
Greece's biggest labor union, the GSEE, deplored the government's use of what it called an "extreme, undemocratic measure."
"Instead of trying to find a solution to seamen's problems and end shipowners' provocative intransigence, the government is making a show of strength against the wrong people," a GSEE statement said.
Main opposition Radical Left Coalition spokesman Panayiotis Lafazanis said ferry crews were left with no choice but to step up their fight.
"You cannot stop workers' protests by dressing them in army uniforms," he said.
Greek unions have held a wave of protests to protest the harsh austerity measures taken since 2010 to secure vital international rescue loans. The repeated income cuts and tax hikes deepened a recession already in its sixth year, amid soaring unemployment that has left more than 26 percent of the workforce without a job.
Resentment across Greece remains high. Farmers are threatening to block highways throughout the country to protest new tax laws, while state media have been on strike for the past two days. Brief clashes broke out with riot police in central Greece Tuesday, when farmers who have lined up some 1,500 tractors near a main highway tried to block the road on foot.
The government insists that the austerity is working, with provisional figures showing that it reduced last year's budget deficit to the targeted 6.6 percent of annual output and achieved a modest primary surplus.
Fitch ratings agency said Tuesday that the Greek economy appears to be "rebalancing," but warned that further structural reforms will be needed.
"Greece, which had the highest peak deficit of any eurozone country, has done the most to balance its books," a Fitch statement said. "However, it still has a long way to go before debt starts to fall and it complies with" European Union deficit regulations.
Meanwhile, Athens on Tuesday saw its borrowing costs dip slightly in an auction of 26-week Treasury bills. The public debt management agency said it raised (EURO)812 million ($1.1 billion) at an interest rate of 4.27 percent—compared to 4.3 percent in last month's auction.
Although unable to raise money by selling long-term debt, Greece maintains a market presence through regular short-term Treasury bill auctions.
Derek Gatopoulos in Athens and Costas Kantouris in Thessaloniki contributed.