Results from the Greek referendum on Sunday showed voters soundly rejecting the terms of an international bailout, according to the BBC and other sources. Greece's governing Syriza party encouraged its citizens to vote "No" on the bailout, saying the terms were humiliating.
The "Yes" campaign warned that rejecting the terms could see Greece ejected from the Eurozone. Some European officials had also said that a "No" would be seen as an outright rejection of talks with creditors. But Greek government officials have insisted that a "No" vote would strengthen their hand and that they could rapidly strike a deal for fresh funding in resumed negotiations. They expect Greek banks to reopen by Tuesday.
According to Al Jazeera, German Chancellor Angela Merkel and French President Francois Hollande announced after the voting had ended on Sunday that they would meet in Paris on Monday evening (local time) to discuss the results and the country's future role in the Eurozone. The New York Times is reporting that Yanis Varoufakis, Greece’s "combative" finance minister, who took a strong stand in demanding that creditors write off some of his country’s debts, abruptly resigned on Monday morning. Varoufakis had played a key role in rallying votes for a resounding “no” on the referendum, and as the paper noted, Greece’s Eurozone creditors may be more willing to continue negotiations on a further aid package without him. His departure, reportedly at the urging of Prime Minister Alexis Tsipras, could be seen as a concession to the sensibilities of other Eurozone leaders, whom Varoufakis allegedly alienated.
"I consider it my duty to help Alexis Tsipras exploit, as he sees fit, the capital that the Greek people granted us through yesterday’s referendum," Varoufakis posted in his blog. "And I shall wear the creditors’ loathing with pride."
The Impact on Travel and Hospitality
The turmoil may be good for Greece's travel and hospitality industries, however. As the Washington Post notes, the instability and the "massive" stimulus program by the region’s central bank have sent the Euro "plunging" against the dollar. The currency hit a 12-year low in March of $1.05. It began to grow again in the ensuing months, but began sliding again in mid-June as the crisis in Greece became headline news.
This means that the American dollar is now much stronger throughout Europe than it has been in years, meaning visitors may well be able to not only stay longer, but upgrade their hotel and travel experiences.
Several travel sites have advertised deals on European vacations. Orbitz touted Greece as “a world of destinations,” and Lufthansa named Athens its “pick of the week.” (The Post noted the irony in Germany's flag-carrier promoting Greece's capital, as Germany has drawn the hardest line among European nations in negotiations with Greece.)
Tourism accounted for about 16 percent of Greece’s economy in 2013 and supported 657,000 jobs, according to the World Travel and Tourism Council. The Australian Financial Review noted that international tourist arrivals to Greece rose almost 21 percent in 2014 to more than 24 million. Hotels, restaurants and bars had expected similar growth this year, but with the recent news, "many" visitors have canceled their Greek trips while others arrive with wallets "stuffed" with euros.
According to the country's ferry operators' union, bookings for journeys around the Greek islands are down 30 to 40 per cent from the same period last year, and schedules are being pared back to conserve fuel.
The Nation's Economy
According to the Washington Post, Greece's banks are at risk of collapse in the coming days, and the country could be forced to leave the historic monetary union. Investors may refuse to lend Greece money at almost any cost, as banks and the government lack essential funds to operate. Over the weekend, former U.S. Treasury Secretary Larry Summers wrote:
"Greek banks will run out of cash early in the week, probably on Monday. There will be an immediate need to either provide them with some sort of IOU scrip to meet demand for funds or to resolve them in some way, as Greece lacks the capacity to create Euro. What the Europeans do and the decisions the Greeks make will shape the future of Greece and the Euro area."
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