- Title: EUROZONE-GREECE/BUSINESS Greek businesses fear 'Grexit', urge PM to secure a deal
- Date: 8th July 2015
- Summary: ATHENS, GREECE (JULY 8, 2015) (REUTERS) PEOPLE WALKING PAST SHOP
- Embargoed: 23rd July 2015 13:00
- Keywords:
- Location: Greece
- Country: Greece
- Topics: General
- Reuters ID: LVABL7XQFT4Y8AIA8EOK6J5UZHIN
- Aspect Ratio: 16:9
- Story Text: The president of the Hellenic Confederation of Commerce and Entrepreneurship (HCCE) said on Wednesday (July 8) the group had sent a letter to Prime Minister Alexis Tsipras urging him to agree to a deal with international creditors now to save the country from economic collapse.
Representing small businesses, Vassilis Korkidis said five years of austerity have crushed SMEs in Greece. Capital controls imposed on June 29 are killing them off fast, he said.
In the letter to Tsipras, he said: "The damage that has been done with the closure of banks is immeasurable, since all commercial credit has been lost. There is no more time to waste with statements that failed to materialise."
The private sector representatives of industry, commerce, tourism and industry have also sent a letter to Tsipras voicing "deep concern about the state and potential deadlock of the negotiations between the Greek government and our partners" adding that "without agreement and therefore without investments, the unemployed are not going to find work".
Eurozone members have given Greece until the end of the week to come up with fresh proposals in return for loans that will keep the country from crashing out of Europe's currency bloc.
The European Commission chief Jean Claude Juncker said the bloc's 19 eurozone countries had made provisions for 'Grexit'. His preference was for Greece to stay in the eurozone but that may not be possible.
The situation in Greece has worsened with banks closed for a second week, limited cash withdrawals and businesses feeling the crunch of demands from vendors for cash payments.
"I would say that the entrepreneurship in Greece is in an asphyxiation condition and this will not change for a long time . Even if we have an agreement on Sunday, the market will require at least 2 months in order to recover," Korkidis told Reuters in an interview.
Greece has lodged a formal request for a bailout loan with the eurozone's special support fund, a spokesman for the European Stability Mechanism (ESM) said on Wednesday.
In a letter sent to the ESM, Greece promised to implement pension and tax reforms as early as next week as the first step to securing a three-year rescue loan to cover debt obligations.
Greece also pledged to honour its financial obligations and to detail, by Thursday (July 9), reforms proposals for evaluation by the creditors.
The Eurogroup of finance ministers is due to consider the application, which is formally addressed to its chairman Jeroen Dijsselbloem on Thursday.
"We trust Member States appreciate the urgency of our Loan request at this time given the fragility of our banking system, our shortage of available liquidity, our upcoming obligations, our build-up of internal arrears, and our expressed desire to clear our outstanding arrears with the IMF and the Bank of Greece," the letter from the Greek finance minister said.
Korkidis said the joint letter from the business leaders and employers to Tsipras made it clear would accept "over-taxation" as a fair price to pay to stay in the euro and save the country from collapse.
"The priority of all of us and especially the SMEs is not to allow our country to bankrupt. A cross default would be a disaster. Therefore we sent a letter, a joint letter, we made a joint statement, all the big organisations of employers in Greece requiring from the prime minister to go to this agreement that we know is going to be for the salvation of the country and we accepted that we are prepared to take this burden of over taxation in order to save Greece," he said.
In the streets of Athens, shop owner Sifis Sakalak blamed the government for ruining small businesses.
Sakalak owns a wool shop which has been in his family for four generations.
He said he wanted the government to play by the eurozone rules.
"Europe has rules, there must be rules in life. If we want to play a game without rules - with the only rule being the lack of rules, then I am sorry to say that we are wrong. The people who are ruling Greece must understand that life requires rules and dignity and not just in meaningless words, but also in actions. So let's act and let us finally be judged on our actions," he said.
A government official said on Wednesday that Greece would issue a ministerial decree later in the day to extend the bank holiday.
Figures from the HCCE show that in 2014 Greece imported 22 percent of its meat products, 17 percent of dairy and 13 percent of fruit and vegetables.
Korkidis said Greece was so import-dependent, the country will soon see shortages if the situation goes on.
"52 (percent) of the essentials, 52 of the food products, 52 of the, 52 percent of the medicines they are imported. Therefore the problem is going to be multiplied in the next couple of weeks. If this isolation, this capital controls will not allow us to pre pay in order to get certain goods imported in Greece then we will have shortages," he said.
International businesses were already starting to fret on Wednesday.
Emirates airline said it had stopped selling tickets via travel agents and tour operators in Greece for now due to concerns over the financial crisis in Greece. - Copyright Holder: REUTERS
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