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Greek store closures spike as recession, austerity return

A man stands next to Greek national flag at a kiosk in central Athens, Greece, July 20, 2015. Greece reopened its banks and started the process of paying off billions of euros owed to international creditors on Monday in the first signs of a return to normal after a deal to agree a new package of bailout reforms. Increases in value added tax agreed under the bailout terms also took effect, with VAT on food and public transport jumping to 23 percent from 13 percent. The stock market remained closed until further notice. REUTERS/Yiannis Kourtoglou

Thursday, 23 July,Athens:Running a business in Koukaki is becoming a struggle.

Shop-owners in the central Athens neighbourhood, one of the capital city’s most financially diverse, are finding it a lot more difficult to get by.

They could be cutting hair or selling extra-large shirts, it makes no difference.

Their tales of hardship can be repeated up and down the country of nearly 11 million people.

Empty storefronts are again a feature of Greece’s towns and cities amid a crisis that put Greece’s future in the euro in doubt.

The downturn worsened after the late-June decision by the Greek government to impose a series of strict controls on the free flow of money, with a paltry 60-euro a day limit on daily withdrawals from ATMs.

Though banks reopened this week for the first time in more than three weeks, the ATM withdrawal limit is unchanged and cash is becoming scarce.

For an economy where cash payments are the norm, that’s a problem.

In Koukaki, about 2 kilometers south of downtown Athens, 65-year-old mechanic Giorgos Prasinoudis is angry.

His wife and 11-year-old daughter have already moved to Germany, the country that’s ironically blamed for many of the economic and social problems afflicting Greece.

He sat drinking coffee on the sidewalk outside his motorcycle repair shop yesterday, with posters of bikes and children’s drawings pinned to the wall.

He’s closed the store after 32 years. A “For Sale” sign is taped to the window.

“It’s over for Greece. We won’t recover for another 50 years,” he said. “The country borrowed so much money, those who benefited left the country, and ordinary people have been handed the bill … I hope my daughter learns

German and doesn’t come back. Not even for a holiday.” Prasinoudis is one of the countless victims of Greece’s economic crisis. Locked out of international bond markets in the spring of 2010, the country has relied on foreign rescue money to pay its debts — on condition that tough austerity measures, such as cuts to spending and increases in taxes were imposed.

The cost has been huge.

A million jobs, mostly in the private sector, have been lost since then, around a fifth of the country’s workforce.

But after appearing to stabilise last year, the Greek economy has gone into reverse but unemployment remains high. At last count, unemployment was still over 25% and more than 50% for the under-25s.

Alongside the capital controls, the government imposed a new round of austerity, raising sales taxes and levies on businesses, while maintaining emergency taxes on households that have eaten up disposable incomes.