LIMA, Peru (Reuters) -- Hundreds of striking workers broke through the
                  main gates of Peru's presidential palace on Wednesday and stormed the
                  parade ground, where they clashed with police and soldiers, witnesses said.

                  In Peru's most violent protest in years, at least 300 workers, demonstrating
                  against President Alberto Fujimori's possible re-election bid and demanding
                  more jobs, smashed palace windows and raided a basement storage room
                  during three hours of violence that rocked the city center.

                  In a 30-minute battle, dozens of police and soldiers, who burst from the
                  palace's main entrance door, fired shots in the air and pushed the protesters
                  from the parade area back into Lima's main square.

                  Government Palace and its parade area, where the president holds martial
                  ceremonies to welcome visitors, is a symbol of Fujimori's statesmanship and
                  was believed by Peruvians to be one of the most heavily guarded sites in the
                  country.

                  Fujimori inspects the damage

                  During the battle, Fujimori remained inside the palace. He later inspected
                  the battle ground -- littered with glass, banners and sticks -- from an
                  upper-story window.

                  In the disturbances, which also included clashes with police outside
                  Congress and the looting of several downtown shops, at least a dozen
                  people were injured and about 20 were arrested, authorities and
                  witnesses said.

                  The palace incident, which was the worst bout of violence in the protest,
                  appeared to erupt spontaneously. It mainly involved teen-agers.

                  Brandishing sticks and iron bars, the teens congregated outside Government
                  Palace and, as they pressed against the iron railings, the gates broke open,
                  allowing them to flood onto the parade ground.

                  Strikers protest congressional vote

                  About 5,000 workers, obeying a nationwide strike call by Peru's largest
                  unions, marched in Lima to protest a congressional vote that quashed calls
                  for a referendum over whether Fujimori could run for re-election.

                  The strike was partially obeyed in Lima and several other cities, where
                  workers marked the protest with peaceful marches, union leaders said.

                  The protesters at Government Palace initially crowded onto the parade
                  ground -- the size of a small soccer field -- without encountering
                  opposition.

                  They spent about 15 minutes breaking palace windows with sticks and
                  smashing furniture inside the store, where they helped themselves to
                  ceremonial uniforms and swords. They daubed a side wall of the presidential
                  palace with graffiti labeling Fujimori a "dictator."

                  About 50 soldiers and police with riot shields burst out of the palace and
                  threw tear gas canisters, forcing the workers back into the main square.
                  Other police fired shots in the air from a nearby roof, witnesses said.

                  A Machiavellian plot?

                  Political analysts and local media commentators questioned how the security
                  forces, which usually keep a tight control on protests in Lima, allowed
                  Wednesday's march to become so violent. Some suspected a Machiavellian
                  plot.

                  "The government has permitted these incidents to happen. It would not
                  surprise me that they themselves provoked it to justify criticizing the march
                  and avoiding new protests in the future," sociologist Juan Osio said.

                  Fujimori's popularity dropped sharply after last month's vote in Congress
                  quashing any referendum bid. While his economic policies are popular with
                  foreign investors, they have failed to reduce unemployment.

                  Peruvian law does not make clear whether Fujimori can serve more than
                  two terms -- a legal loophole that has caused huge controversy since
                  Congress passed a 1996 bill interpreting the constitution to allow him a
                  possible third bid.

                  Copyright 1998 Reuters Limited.