“The adverse repercussions of the virus on the economy will not be bearable for long”, the president of Caritas Greece has alerted the EU.
– Virus could cost Greece up to €5 billion euros a month
Though Greece has been spared the worst of the virus, with 2,626 infections and 143 deaths as of May 3, the pandemic has sparked fears of a new recession in the country, Father Antonio Voutsinos warned SIR in an interview May 4.
“The closure of so many businesses has resulted in thousands of job losses and a drop in consumption”, the priest lamented.
“The State is helping those who have lost their jobs with monthly 800 euro subsidies. These are significant amounts, for some even higher than the salary they received when they still had a job.
“But how are we going to pay back this money?”, Voutsinos asked.
That question is especially pointed given that even conservative estimates suggest that the virus will cost Greece between €3-5 billion euros a month.
It’s a figure that will have to be revised upwards, given the projected losses in Greece’s tourism sector, which in 2019 injected some €18 billion into the economy, or 20% of the country’s GDP.
As Stamatis Vlachos, the director of the social economy and solidarity programs of Caritas Greece recognised, the epidemic “occurred precisely during the period of bookings for the next summer season”.
“Nowadays there is hardly a single tourism enterprise or project that hasn’t been forced to close down, as all bookings have been cancelled, and nobody knows when, and under which conditions, travel and tourism will be resumed. Already a whole year has been lost, not just a few weeks”, Vlachos lamented.
– “Europe cannot and must not ignore this. It must do its part, its history is at stake”
Those dire unemployment and tourism numbers are ringing alarm bells for priest Voutsinos, who revealed his concern for how the eleven million people in Greece will be able to respond to a new downturn when they’re still trying to recover from a decade of financial austerity imposed by the ‘troika’ of the European Union, the European Central Bank and the International Monetary Fund after the 2008 global financial crisis.
“The COVID-19 pandemic threatens to nullify all efforts made so far” in getting Greece’s head back above water, “and above all the major sacrifices of the past years that offered a glimpse of hope for the future”, Voutsinos told SIR.
The Caritas president expressed his appreciation to the government for the “prompt action” it took to halt the spread of the virus especially in the nation’s refugee camps, home to over 100,000 asylum seekers.
He also voiced his gratitude to the Greek people for displaying in their observance of social distancing measures the “resilience” they learned “during the hard years of the financial crisis”.
But Voutsinos warned his fellow citizens that Europe will be expecting further “sacrifices” from them, for which reason he called politicians, too, to “unity and solidarity”, so that those sacrifices of the people are not in vain.
“Europe cannot and must not ignore this. It must do its part, its history is at stake”, the priest alerted Brussels, adding that “now more than ever we need a Europe that shows solidarity and unity when taking decisions”.
The lack of EU solidarity has been one of the talking points of the virus crisis.
Although Brussels and the EU member states have agreed to a €540 billion rescue package, those funds are to be made available to countries in need as loans, not transfers, leading to concerns of a new sovereign debt crisis.
Moreover, just €125 billion of the EU rescue funds – or just 1% of euro-zone GDP – represents new spending on top of that of existing solidarity mechanisms.