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Media Reports Hurting Greek Tourism
July 11, 2012 02:49 PM
LETTER FROM EUROPE
Greece has been close to my heart since my first visit over 20 years ago. My friend Petra and I, fresh out of college, decided to backpack across Europe. After several uncomfortable nights on the open decks of ferries, hopping between Greek islands, we finally landed on the island of Crete. We made our way to Matala, a tiny village you might know from the Joni Mitchell song “Carey,” which she wrote about her experience living
there in the late 1960s. There is something magical about Matala, with its turquoise bay and warm, easy-going generosity, and over the years that is the place I return to again and again when I need a break from the world. So in the midst of the Greek crisis, I naturally wondered how the people of Matala are weathering the storm. Last week, I decided to hop on a plane and find out for myself.
First, some facts about tourism in Greece: Tourism is about 17% of Greece’s GDP, accounting for nearly 20% of jobs. Around 65% of the tourists are from Europe, with the largest portion coming from Germany, followed by the British. It is absolutely vital for the Greek economy that this industry holds up. In recent months, however, Germans have been staying away from Greece. The Germans are afraid of the riots seen in the news, and afraid of an anti-German sentiment blaming them for the austerity measures. According to the Bank of Greece, tourism revenues for the early part of this year fell 44.7% from last year.
When I arrived at the bed and breakfast where I normally stay, Princess Europa, which has been in the Kyprakis family for generations, I asked its owner how he has been faring. “What is definitely missing is the Germans,” he said. He claims business is down 20%-30% and he is bitter. He blames the media for blowing up the extent of the rioting, which is really limited to government workers around Syntagma Square in Athens and has not been spreading out to the islands. “You see, everything here is normal. There are no riots here. We might not like what the German government does, but no one hates the German people. It’s the propaganda in the media that is hurting our business,” he complained.
To fill his hotel, he has dropped prices, hoping to make money from guests who order food and drinks. The plan seems to have backfired though; it has been attracting customers who have very little money to spend. He said many of the guests are making sandwiches in their rooms.
In the village, I immediately noticed further evidence of missing tourists: The shops were empty. On a Saturday night, during the high season in July, my daughter and I were the only people in the restaurant “Die Zwei Brüder.” Last year at the same time, we had to wait for a table. I asked the restaurant owner Manolis Mathaiakis how he is doing. He sat down and quietly said, “Look around you. The restaurant is empty. That’s how I am doing.” His business is down 50% this year.
Manolis’ entire extended family relies on this business. His parents have a combined retirement income of 600 euros a month. The health care system has broken down to the point where medication is only being given out in return for cash. “My parents' entire income now goes for medicine for my father. He has a bad heart,” he explained, his eyes welling with tears.
But what really worries Manolis is the situation in the cities. Half of Greece’s population lives in Athens. His cousin’s salary was recently cut from 1200 euros to 700 euros. He can no longer pay his rent. My taxi driver said the same thing. He has two small children to take care of -- but despite working longer hours, he can no longer afford electricity. “On Crete, we will be alright,” Manolis explained. “We are farmers. At home, I have tomatoes and watermelon. We will survive, but what about those in the city? I am very worried about what will happen in the next month or two.”
Is he bitter? How does he feel about the austerity measures and political changes? “I really don’t know,” he said. “It's all very complicated and I don’t know what’s best for us. I’m just trying to run my restaurant. I know what they say about us -- that we are lazy and don’t pay our taxes. But we are such a small country. How did we get to be the black sheep so that the entire world hates now? The government borrowed money, but where did it go? I didn’t see any of it. Crete didn’t see any of it. I work very hard, that’s all I can do.” He is angry about the corruption in his government and knows that something needs to change. But like so many of us, he feels powerless.
On the subject of working hard, my hotel host was a bit more indignant. “I dare anyone to follow me around for a week!” he said, his finger close to my nose. And he is right. Statistics from the Organization for Economic Cooperation and Development
show the Greeks worked 2,116 hours in 2008, while the average German worked 1,426 hours. As one example, Vasilis Papamihelakis, who provides fishing excursions (which I highly recommend) for tourists in the nearby village of Agia Galini told me he gets up every morning at 4 a.m. to go fishing. At 10:30 a.m., he picks up tourists to take them on his boat to a secluded beach where he makes a fantastic lunch of fresh fish, salad, watermelon, and wine, and then he drives them back by 5 p.m. Afterwards he works in his family olive grove until dark. Seven days a week.
The subject of taxes was also touchy. When I asked Manolis about the Greeks and tax evasion, he smiled sheepishly. “Well, that might be a bit true.” Mr. Kyprakis back at the hotel however, was again indignant. “The Germans have just as much going under the table! If a German keeps 30% under the table, that’s not so different from the Greeks keeping 50%!” A near confession? In fact, statistics say that Greece's "shadow economy" is 24% of GDP. In Germany, it is 14%.
Another source of Mr. Kyprakis’ resentment is the presence of
reports that Germany is making a lot of money off of the crisis. According to Re-Define, an economic research institute in Brussels, Germany saved around 20 billion euros in borrowing costs from 2009 to 2011, with an additional 20 billion euros in savings locked in for the future. The crisis has caused Greek bonds to skyrocket while German bonds have even dipped into negative territory. German exporters are also benefitting from a weaker euro. So for many Greeks like Mr. Kyprakis, there’s a lot of suspicion that there might not be a lot of German motivation to really solve this crisis completely. What they aren’t seeing is that Germany is providing the largest guarantee to the eurozone’s bailout fund, so while they are insulated in terms of interest rates, liabilities are high.
The people of Crete are proud and have a long history. The first human settlement in Crete dates back 130,000 years. Crete was the center of Europe's first advanced civilization. This crisis won’t destroy them. When I asked Nikos and his wife, who have been selling homemade Cretan Raki (spirits made from grapes that tastes a lot like airplane fuel) from their one-room house for as long as I can remember, how they are doing, they both just laughed. “Hard times come. Hard times go. That’s life.”
If there is one message that everyone wanted to pass on to you readers, though, it was to please come visit. “Please tell everyone that we are peaceful people on Crete, and they are always welcome. Don’t believe everything in the media,” Mr. Kyprakis said. Manolis asked, “Please tell everyone we aren’t angry; we are just really sad.”
And as the taxi driver said, “We don’t see Americans, Belgians, Dutch, and Germans. We only see guests. And we need you desperately.”
Editor's Note: The author has previously written about the German point of view of the euro crisis in
5 Reasons Why the Americans Are More Worried About Europe Than the Europeans
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