Winners and losers

imageEach crisis has its casualties, but you may be surprised to know that some have benefitted from the capital controls that have otherwise paralysed the Greek economy since the banks closed on the 29th June.

Overall, the damage is expected to be pretty catastrophic. The tab has not yet closed, but already some first assessments are being produced by retailers and other market participants.

Below I have compiled a list of the winners and losers of the capital controls, lest we forget what a topsy turvy world we have been living in:

The losers:

  • Anyone without a cashpoint card or credit card: cash withdrawals are limited to €60 (effectively €50 as the ATMs ran out of €20 notes within a few days), but anyone with a card can use it within Greece. Only pensioners without cards have been allowed limited counter service at selected bank branches.
  • Pensioners without ATM cards: these were given more limited access to their bank accounts, permitting €120 per week, compared to 5x€60, until the banks were able to issue new cards; given the high rate of unemployment, it is not uncommon for pensioners to have a large number of dependents, creating a ripple effect.
  • Import reliant businesses, including many manufacturing and exporting businesses which rely on imported equipment or raw materials.
  • Retailers of clothes, shoes, toys and other low-value non-essentials have seen sales fall off sharply as purchases are postponed.
  • Anyone reliant on foreign services, e.g. foreign airlines, iCloud and cloud applications: foreign payments and transfers have been frozen, so subscriptions have been suspended. Apple has given free iCloud access to Greek users until further notice.
  • Anyone reliant on drugs and medical supplies, with the exception of certain essential prescription drugs which like other imports, are starting to run short in pharmacies and hospitals.
  • … and of course tourism, accounting for 6.5% of Greece’s GDP: while tourists have continued to arrive at Greek destinations, future bookings reduced and cancellations increased.

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The winners:

  • Supermarkets: turnover increased by 30-40% as households topped up their regular shop with a few more essentials, though there has not yet been full-blown panic-buying.
  • Petrol stations: most drivers made sure they were topped up with fuel in the event of a supply squeeze, though queueing has not been as widespread as news reports implied
  • Consumer electrical and electronic goods retailers and car dealerships: many consumers fearing that a Cyprus-style bank bail-in my result in haircuts to bank accounts well below the nominal €100,000 threshold decided to sink disposable cash into flat screen TVs, cookers, fridges and electronics “while they still have it”. One UK-owned chain boosted it’s parent company’s profits by 21%.
  • Working parents (at least temporarily): banks were on a “holiday” and many businesses sensing a slowdown and unable to meet payroll demands put employees on unpaid leave; parents and toddlers have been enjoying the parks and beaches mid-week.
  • The Greek state (paradoxically): the fear of a deposit haircut on bank accounts also prompted may taxpayers (businesses in particular) with access to e-banking to expedite payment of their taxes.
  • Visa and Mastercard: credit and debit card use has not been widespread in Greece, especially for small amounts; but as card payments within Greece have been exempt from the capital controls, their uptake has been rapid.
  • Private security firms: workload for firms offering secure storage and armoured transport took off, as a number of private companies opted to pay their employees in cash. Electrical goods retailers experiencing a spike in sales but unable to bank their daily cash takings also required daily transport and secure storage.

Some more detailed examples, mainly of losers can be found here.

Photos by Atlantis Host. Street market and white goods delivery in a middle class neighbourhood of Athens, two weeks into capital controls.

Winners and losers

One thought on “Winners and losers

  1. Dionyssis Dimitrakopoulos says:

    Hello. I like the focus on practical things and the clarity of the writing. The former is likely to be popular with non-Greeks who do not know much about this kind of stuff. Keep it up (and thank you)!


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