PHILIP PANGALOS, ATHENS From: The Times
IN a sign of the increasingly gloomy times in austerity-stricken Greece there was no traditional Christmas tree in the heart of Athens this year.
The decision not to have a tree in Syntagma Square, across from the neoclassical parliament building, was taken by the mayor in an attempt to save money as the country grapples with its worst recession in nearly four decades.
Instead, lights were thrown over a number of existing trees, while children from schools across the capital made decorations from recycled drinks cans and hung on them.
It wasn’t just the Christmas tree that was missing. There was no brightly lit carousel or the coloured little festive houses selling sweets that had adorned the square in past Christmases.
There was also a distinct absence of Christmas shoppers. Even Ermou Street, the capital’s equivalent of London’s Oxford Street, was much quieter than in past years. Those who did shop were reportedly spending much less than usual, seeking bargains or lower ticket items.
The omens are not good.
The Athens Shopkeepers’ Association expects Christmas sales to decline by 30 per cent this year to about E9.25 billion ($12bn). At the same time, “for sale” or “for rent” signs are peppered around most streets across the commercial district of Athens and in shopping streets in the suburbs.
“Sales have collapsed and the recession is deepening, while a growing number of businesses are failing. Sales this Christmas are down by between 30 and 50 per cent at most shops, while fashion retailers are down by about 60 per cent,” Giorgos Zissimatos, president of the Piraeus Traders’ Chambers, said. He said that more than 440 shops had closed so far this year in the Athens port city.
“The Greek economy is falling apart and this has an effect on society. People are losing their jobs and homes, while more and more businesses are closing. It’s like we have been carpet bombed,” Mr Zissimatos said.
Most public and many private sector workers have seen their income cut by more than a third as a result of draconian austerity measures, pay and bonus cuts, as well as a series of tax hikes over the past two years in an attempt to restore fiscal order to the country, where public debt is about 160 per cent of gross domestic product.
The economy is expected to contract by nearly 6 per cent this year as a whole after GDP shrank by 5 per cent year-on-year in the third quarter, 7.4 per cent in the second quarter and a huge 8.3 per cent in the first quarter.
GDP is expected to contract by a further 3.5 per cent next year as the country enters its fifth straight year of recession, with no upturn predicted before 2013 at best.
Meanwhile, the jobless rate recently hit a record high of 18.4 per cent at a time when youth unemployment (those aged 15-25) is above 40 per cent, prompting fears of growing social unrest.
The IMF sees unemployment peaking at 19.5 per cent in 2013.
The number of people turning to soup kitchens, many of them run by charities or the Greek Orthodox Church, has spiralled.
“For some time now, thousands of people gather (at soup kitchens) on a daily basis,” said Archbishop of Athens and All Greece Ieronimos during a visit to an Athens. “This is sad. It’s sad that people crowd here for a plate of food. It’s sad that the number of those in need is growing.”