Greek industry savaged by economic crisis

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Greek industry savaged by economic crisis

Greek industry savaged by economic crisis
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It is the story of an economic crisis which can be told not just in numbers but also by the millions who have seen their lives turned upside down.

Head out 70 kilometres from Athens and you will find a cement factory in Chalkida, city of the sacred fountain of Arethousa. It is despair which now flows through the lives of the people who used to work here.

Stelios Fotias, an employee of the cement factory, told of their despair: “There were massive layoffs of 226 employees here. They didn’t ask for 50,60,70 or 80 people to go. It’s just a matter of time and we will all be gone. We are just waiting – this month, the next, or the month after. Sooner or later we will all be finished.”

The factory opened in 1926, but two years ago the management decided to close it down. Orders were dwindling, there was not sufficient demand.

Euronews business reporters in Greece, Symela Touchtidou, takes up the story: “Up until four years ago this region of Evia thrived as one of the industrial centres of Greece. Now it is an area savaged by unemployment which is running at more than 35 percent.”

Under Greek law no company can lay of its workers “en masse”. Many still have to turn up at the factory and wait their turn to go. The country’s gross domestic product has shrunk by 26 percent in the past six years, figures which reflect the size of the problem.

Maria Smirneou, Secretary General of the Labour Centre of Evia, told euronews: “Since 2010 we have seen constant de-industrialisation of the region, a constant closures of the big factories which used to be powerful employing hundreds of people and which had a great impact in the region.”

To survive one company decided to fight fire with fire. Cigarette maker Papastratos opened in 1932. It has invested heavily in the hope that when the crisis is over it will be in a prime position in the market.

No salaries have been cut, no workers laid off. But taxes mean a formerly profitable company is now loss making.

Nikitas Theophilopoulos, chief executive of Papastratos, said: “We have had seven tax increases in five years. Today, 90 percent of the price of our products is taxes. So that leaves just 10 percent for the industry and for wholesale and retail. Furthermore the decline of purchasing power has been a big problem. The consequence of these two factors has been a rise in smuggled products.”

Sunshine and culture are two aspects of tourism in Greece, the rock on which last year’s return to growth was built. Across the board price cuts helped pull in visitors. But two words could halt that trend “Greek crisis”. The fear is that they will return to the headlines and scare the tourists away.

Yiannis Retsos, president of the Hellenic Federation of Hoteliers, explained: “We had a record year with 24 million visiting in 2014. You understand the last thing we want is the picture of Greece in decline returning to the international media headlines because Greece is not in decline. So, from the outset, we asked all parties to show restraint and to run calm elections.

The Greek business community will tell you that what is at stake in these elections for them is stability, political stability. Many say they do not care which party wins, just that there is a stable government which will not jeopardise Greece’s relations with its European partners.