– The head of Greece’s financial institution affiliation says round forty billion euros have been withdrawn from Greek banks since December. Greeks will be able to deposit checks but not cash, pay bills as well as have access to safety deposit boxes and withdraw money without an ATM card.
In downtown Athens, people queued up in an orderly fashion as the banks unlocked their doors at 8 a.m., taking a number and reading the paper as they waited for their turn at the till.
The reopening of banks has reportedly gone smoothly without incident.
The changes aim to restore trust inside and outside the country after eurozone leaders agreed to a third bailout in exchange for reforms.
Sales taxes have risen from 13 percent to 23 percent on many basic goods – including some meats, cooking oils, coffee, tea, cocoa, vinegar, salt, flowers, firewood, fertilizer, insecticides, sanitary towels and condoms.
Limits on withdrawals will remain, however – at €420 per week instead of €60 per day previously – and payments and transfers overseas will still not be possible, a situation German Chancellor Angela Merkel said on Sunday was “not a normal life” and warranted swift negotiations on a new bailout, worth up to €86bn. “The new increases will be the death of small businesses, including taxi drivers”, he told Xinhua.
The draconian agreement – accepted by a party that came to power in January promising to end austerity – came after more than 61 per cent of Greeks rejected further cuts in a July 5 referendum called by Tsipras himself. This was done to aid reforms last week, which could avert the nation’s bankruptcy.
However, a new heavy blow to the government’s parliamentary majority could cause political uncertainty at a critical period for Greece, analysts warned.
“As we have said, the fund stands ready to continue assisting Greece in its efforts to return to financial stability and growth”, said IMF spokesman Gerry Rice.
With the re-opening of Greece’s banks, the struggling country has started its long trek to achieving “normalcy” after the recent bailout package.
But the vote paved the way for Greece to receive a bridging loan, which enables the reopening of the banks and for Athens to repay debts to its creditors yesterday.
The loan will also allow the debt-crippled Greek government to make payments to the worldwide Monetary Fund (IMF) outstanding since June.
“I can’t put up my prices because I’ll have no customers at all“, he said.
“We can only give debt relief, we can’t write it off under European rules”.
Her vice-chancellor Sigmar Gabriel, who is also economy minister and leader of the Social Democrats (SPD), coalition partner to Ms Merkel’s conservatives, broke ranks and criticised finance minister Wolfgang Schaeuble for raising the prospect of a Greek exit from the eurozone in the rescue talks.