Business World

Tuesday 24 April 2018

Greeks pull €800m a day from banks and stock up on food ahead of election

Supporters of the Socialist PASOK party raise flares during a pre-election rally at Korydallos suburb near Athens. Photo: Reuters
Supporters of the Socialist PASOK party raise flares during a pre-election rally at Korydallos suburb near Athens. Photo: Reuters

Dina Kyriakidou and George Georgiopoulos

GREEKS are pulling their cash out of the banks and stocking up with food ahead of a cliffhanger election this Sunday that many fear will result in the country being forced out of the euro.

Bankers said up to €800m was leaving major banks daily and retailers said some of the money was being used to buy pasta and canned goods, as fears of returning to the drachma were fanned by rumours that a radical leftist leader may win the election.

The last published opinion polls showed the conservative New Democracy party -- led by Antonis Samaras -- which backs the €130bn bailout that is keeping Greece afloat, running neck and neck with the leftist SYRIZA party -- led by Alexis Tsipras -- which wants to cancel the rescue deal.

As the election approaches, publishing polls is now legally banned and in the ensuing information vacuum, party officials have been leaking contradictory "secret polls".

On Tuesday, one rumour making the rounds was that SYRIZA was leading by a wide margin.

"This is nonsense," one reputable Greek pollster said on condition of anonymity. "Our polls show the picture has not changed much since the last polls were published. Parties may be leaking these numbers on purpose to boost their standing."

The pollster said there was some consolidation, with voters turning to New Democracy and SYRIZA from smaller parties, but the pool of undecided voters remained unusually large so close to the election.

Both parties say they want Greece to remain in the single currency but SYRIZA has pledged to scrap the bailout agreement signed in March, which has imposed some of the toughest austerity measures seen in Europe in decades.

The European Union and International Monetary Fund have warned that Greece, which has only enough cash to last until July, must stick to the conditions of the bailout deal or risk seeing funds cut off.

Fears that Greece will collapse financially and leave the euro have slowly drained Greek banks over the last two years.

Deposits

Central bank figures show that deposits shrank by about 17pc, or €35.4bn in 2011 and stood at €165.9bn at end-April.

Bankers said the pace was picking up ahead of the vote, with combined daily deposit outflows from the major banks at €500-€800m over the past few days, and €10-€30m at smaller banks.

Retailers said consumers were stocking up on non-perishable food.

"People are terrified by the prospect of returning to the drachma and some believe it's good to fill their cupboard with food products," said Vassilis Korkidis, head of the ESEE retail federation. (Reuters)

Euro crisis

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