Greek Bailout 3.0? It's All Russia's Fault

Tyler Durden's picture

Despite 30% general unemployment, the majority of youths jobless, GDP forecasts already disappointing, and government asset sales at rock-bottom prices, Greek leaders are preparing to blame any missed growth expectations on Russia. As Bloomberg reports, hopes of a 2014 exit from its deepest recession in a half-century may hit a stumbling block after Russian sanctions last week. "The impact could be quite damaging for industries such as tourism and agriculture amid the fragility of a slowly recovering economy," warns one think-tank as tourist arrivals from Ukraine are expected to drop by 50% and the 'fruit-and-vegetable' embargo will "send prices falling across Europe, hitting both the volume and value of Greek exports towards other countries." Is it any wonder the Greeks are so vociferously slamming "blind obedience to the Cold War strategies of Brussels and Washington."

Russia is Greece’s biggest trading partner, according to data compiled by Bloomberg. The value of total trade between the two nations reached 9.3 billion euros ($12.5 billion) in 2013, surpassing trade flows between Greece and fellow EU-member Germany. As Bloomberg reports,

“The estimated total cost of Russian counter-sanctions for the Greek economy may look tolerable, but the impact could be quite damaging for industries such as tourism and agriculture amid the fragility of a slowly recovering economy,” said Thanos Dokos, director-general of the Hellenic Foundation for European and Foreign Policy, a Greek think-tank. “It also raises questions about energy security in the coming autumn and winter.”




“Arrivals from Ukraine will drop by 50 percent and arrivals from Russia are expected to reach 1.1 million, instead of 1.3 million,” Petropoulos said.


Tourism contributes more than 16 percent to Greek gross domestic product, according to SETE data, and Russia has been the fastest growing source market for visitors to Greece. Tourism revenues from Russia increased 42 percent last year to 1.34 billion euros, according to Bank of Greece data.




“The biggest impact from the Russian embargo will be from the indirect fallout as Russia’s ban on EU fruit and vegetables means that large quantities of fresh produce suddenly become available, swamping the market,” he said. This will “send prices falling across Europe, hitting both the volume and value of Greek exports towards other countries,” Polyhronakis said.

As we noted previously, the Greeks are not happy at the "Stop Putin" Coalition's blowback...

the moment Russia retaliated, the grand alliance started to crack. Enter Greece which has hundreds of millions in food exports to Russia, and which was the first country to hint that it may splinter from the western "pro-sanctions" alliance. According to Bloomberg, earlier today the Greek foreign minister and former PM said that "we are in continuous deliberations in order to have the smallest possible consequences, and if possible no significant impact whatsoever."




And making it very clear that this will be a major political issue was a statement by the main opposition party Syriza which today said that the Greek government's "blind obedience to the Cold War strategies of Brussels and Washington will be disastrous for country’s agriculture." In a moment of surprising clarity, Syriza asked govt to immediately lift all sanctions to Russia, as they don’t contribute to a solution of the Ukrainian crisis, and "instead fuel an economic and trade war, in which Greece has unfortunately become involved." Syriza concluded that the government hasn’t weighted Greece’s special interests and bilateral relations with Russia.

*  *  *

Of course, despite the absence of TROIKA, we are sure whatever Greece needs, Greece will get from its trading-above-par banking bondholder overlords to keep the dream alive.

And sure enough, not minutes after we posted this, the EU comes to the rescue... (as Bloomberg reports).

A European-wide solution to tackle the problems caused by the Russian ban on food imports, using EU crisis response funds, is “under way,” Greece’s Finance Ministry says in statement.


Greek govt’s goal is to supplement EU funds with other tools, including national means, if necessary, in order to advance a timely and comprehensive solution: ministry


First priority is to assess damage to Greek exporters, work to begin immediately


Govt will support farmers hit by ban: ministry

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Anusocracy's picture

Name, shame, and blame.

It's the only game Greece and the West have.

They need to look in a mirror.

hobopants's picture

I wouldn't be a bit suprised to see them drop out of the union. There is no way they can repay their debt, and now they have lost their biggest trade partner because of it, why stay?

schatzi's picture

I'd be surprised if they did drop out of the "union". I'm guessing you're referring to the € currency union. The vast majority of Greeks want to keep the € and for good reason - even if the currency is contributing to the country's demise. As long as they're in the € currency, bailouts are guaranteed. The only issue they have, is a troika telling the government to adhere to pro-cyclical "austerity" - even if only enough to keep the farce alive. The € is like a drug for them. It's destroying them, it's making them completely dependent while their economy withers away. But they can't live without the bailout fix. I'm assuming the political decision makers are the first at the trough of every bailout, so expect no other path but the € path.


If you're referring to the EU, then I completely contradict your assumption. The EU is economically by and large actually a good thing (if keeping the problematic and undemocratic political development out of the discussion). I'd recommend the Greeks to stay within the EU. Their economy is specialised on tourism and select crops that rely heavily on foreign consumption (mainly European). The EU allows for much easier market access in addition to the benefit of massive infrastructure and agriculture subsidies. Without the EU they'd have to compete against other heavily subsidied European agriculture, which would be of a crippling disadvantage and place them far away from a level playing field.

doctor10's picture

the biggest problem the Greeks have  is they let Brussels and the Eurons take away their Drachma.

jarana's picture

The biggest problem Greece and all south EU countries have is their sistemic bad-investment caused by the artificial low interest rates they were forced to impose as a condition to enter the union, administrated by a bunch of corrupt and keynesian geniuses.

Their biggest threat, a "populist" goverment with drachma, peseta or lira printers.

Look at Venezuela. They are going through the same path by "popular acclaim".

Don't give advises you wouldn't take by yourself.


free_lunch's picture
John Perkins "Confessions of an Economic Hitman"Extended Interview 2008:
valley chick's picture

Greece is so 2013....they had their chance to get out of the EU but they opted to sell their soul to the devil. Screw them.

Jack Sheet's picture

The political and corporate elites will still get their payoffs from the EU and keep their complement of sinecures in the monstrous bloodsucking bureaucracy in Brussels. It's the common people who are fucked.

Anarchy 99's picture

actually the people tried, but their gov stomped them down,  eventually they and the Italians, Spaniards, French and so on will try again, and eventually succeed. 

But lot's of people must die first.

knukles's picture

Wait?  Russia? 
Oh come on, people!

You've got to be kidding me.
The last time I tried "It's Russia's fault" I got laughed out of the bond market for a month ...

Bioscale's picture

Govt will support farmers hit by ban: ministry

Regulating the farmers' business will be a big fail.

Rompoculos's picture

When you read "think-tank" think "piss-tank"

NOZZLE's picture

What fucking agriculture does Grease have?  The whole place is either rocks or the occasional olive grove that was not burned down in 2006 to make room for the housing boom that never came.

Tourism?? you mean where you rent out rooms in your kinda seaside house to strangers for 9EU per night? 

RaceToTheBottom's picture

They mine Oligarchs financials.


Anarchy 99's picture

@ noz.

shame on you as you are ignorant of the real facts.

NOZZLE's picture

What facts are those?


know-zilch's picture

About that 9 euro per night thing in Greece...are you on drugs mate? for 9 phucking euros in Greece you can't even rent a bathroom stall to take a dump you moron.

Check your facts nozzle head

JustObserving's picture
Greek Bailout 3.0? It's All Russia's Fault

Everything is Putin's fault including the shoot down of MH17 and Obama being habitually late for his press conferences:

Since the beginning of the week, the three most influential mass circulation newsmagazines of the United States, Britain, and Germany—Time, The Economist, and Der Spiegel—have published cover stories that combine wild accusations against Vladimir Putin with demands for a showdown with Russia.

The most striking and obvious characteristic of these cover stories is that they are virtually identical. The CIA has scripted them all. The stories employ the same insults and the same fabrications. They denounce Putin’s “web of lies.” The Russian president is portrayed as a “depraved” mass murderer.

whoflungdung's picture

Handelsblatt, one of the best papers in Germany, writes:


The West on the wrong path

In view of the events in Ukraine, the government and many media have switched from level-headed to agitated. The spectrum of opinions has been narrowed to the width of a sniper scope. The politics of escalation does not have a realistic goal – and harms German interests.

loregnum's picture

Putin's fault. He should sit back and let the west try and kick him in the balls. 

I'm just so stunned that sanctions actually affect more than the country being sanctioned in such a globally connected world and I am also stunned that someone who is being kicked in the balls would actually do something about it.


Anusocracy's picture

It's the Broken Window Sanctions Fallacy.

Rainman's picture

All the Grreeks care about is the Eurozone banker suckerz making their credit line payments on time.

Irishcyclist's picture

Greece wasn't too enthusiastic about EU sanctions against Russia last week

Anarchy 99's picture

It's a shame that some here are condemning the Greek population, a country of 8 million people and maybe up to 10% took to the streets, and MANY died, protesting their countrys demise under Brussels.

in the US 10% would have been 33 million hitting the streets in protest, WHERE ARE THEY, the big fucking bloated wallmarters, as their leaders inflict genoside on people that cannot defend themselves, fucking US has fear of North Korea a country of 20 million.

disclosure I am not Greek but I am European.

Coletrane's picture

the planet will be burning before you see those self-obsessed bastards get off the couch.

TheSecondLaw's picture

Second the motion!  Well put.

earleflorida's picture

as the #8 economy in the world... california, wants for water, in what is becoming a decade long drought.

moar corn and ethanol to subsidize farmers land using negative cost-efficient process, futher frustrating what's to come as a redux 'grapes of wrath', via a oklahoma poison'd fracking discombobulation of epic proportions.

and what about poor cyprus? as, turkey throws in the nato towel? 

goldhedge's picture

FUCK ALL Euro spongers.

UKIP is the only party for the UK now.


goldhedge's picture

FUCK ALL Euro spongers.

UKIP is the only party for the UK now.


trelokomio77's picture

I am Greek, and one of the few heroes left who actually own a business in this beautiful country filled with vermin. My business has solely to do with Russia but luckily so far my industry is not on the sanction list. If my products go on the sanction list, I am moving my factory to Albania the next day.

trelokomio77's picture

I am Greek, and one of the few heroes left who actually own a business in this beautiful country filled with vermin. My business has solely to do with Russia but luckily so far my industry is not on the sanction list. If my products go on the sanction list, I am moving my factory to Albania the next day.

22winmag's picture

Greece: another sad, defeated people squatting on the ruins of a once-great civilization.


Say what you want about America and Americans, we aren't squatting on the ruins of a formerly great civilization just yet.

BiPolarFrenchman's picture

What exactly are we going to withhold from Russia with sanctions?  


People do remember how big Russia is, right?

NoWayJose's picture

Why would tourist visits from Ukraine drop? Wouldn't they increase since the Ukies would want to help out a (soon-to-be) fellow NATO country?

Notsobadwlad's picture

I am telling you that Russia could fix a whole bunch of wrongs if they made Greece the exclusive agents for their oil and gas sales to Europe.

You want your grand daughter to not freeze this winter, you unelected little troll von Rumpoy? Let me tell you what you need to do and in what position.

shouldvekilledthem's picture

Update from europe: the sheeple just couldn't care less what their overlords do.

The end is nigh :)