Each Day Without Debt Deal Costs Greek Economy €22 Million And 613 Full-Time Jobs

Tyler Durden's picture

It’s no secret that the protracted negotiations between Athens and its creditors are taking a toll on the Greek economy in general, on the Greek banking sector more specifically, and on Greek citizens most tragically. 

For banks, each day without a deal is one day closer to outright insolvency. Even if the ECB continues to raise the ELA ceiling and refrains from raising the haircut on the assets Greek banks pledge for emergency liquidity, the banking sector will run out of collateral by the end of next month. 

As for Greek citizens, there are likely days when mental exhaustion sets in amid the constant stream of contradictory headlines and incessant media coverage, but any feelings of indifference are inevitably interrupted by stark reminders of a grim economic reality such as empty pensioner bank accounts and looped video clips of the Nazi occupation meant to rally the country behind a desperate war reparations claim on Berlin.

Now, thanks to a new report from the Hellenic Confederation of Commerce and Enterprises, we can quantify the daily economic toll of failed negotiations. Here’s more from Kathimerini:

An average of 59 enterprises close every day of the working week and 613 jobs are lost, while every day, with the market facing a cash crunch, the economy loses 22.3 million euros from its gross domestic product, according to a report published by the Hellenic Confederation of Commerce and Enterprises (ESEE).

The country reportedly needs billions in new financing...  

A deal with the country’s creditors is more urgent than ever, ESEE stressed, but the economy would need as much as 25 billion euros in financing in order to restart, as losses from the first five months will be hard to cover over the rest of the year, argued ESEE.


This uncertainty has hit the local economy after five years of crisis, during which retail commerce turnover shrank by 26.2 percent. Things were worse for wholesale commerce, with turnover dropping 37.1 percent, while the car market crumbled by 61.9 percent in the same period, the confederation’s data show.

...and the banking sector is simply unable to make loans...

Liquidity is becoming an unfamiliar term in the market as 95 percent of applications for loans are rejected every day by commercial banks, while only one in 10 enterprises dares to ask for funding from the country’s four systemic lenders, the ESEE report showed. The absorption of funding tools for business liquidity stands at 40 percent, while in the funding of commerce the rate does not exceed 12 percent.

...meaning it may be time for Syriza to realize that giving up on campaign promises is preferable to forcing citizens to confront an economic situation which is quite literally getting worse by the day...

ESEE is urging the government in dramatic terms to reach a deal with Greece’s creditors even if it’s not a great deal.


“A final agreement, even if it is mediocre or below expectations, is certain to allow the Greek economy to feel free at last to operate for the remainder of 2015,” read Monday’s ESEE statement. “Financial and political time are running dangerously short, and reaching a sustainable agreement with our partners is vital as it is directly associated with the country’s capacity to draw liquidity from the European funding tools,” it added.

And meanwhile, support for the government which just four months ago was billed as the savior that would lead the Greek people out from under the thumb of overbearing EU creditors on the way to restoring a sense of Hellenic pride, is now seeing support for its mandate dwindle, suggesting that if a deal isn’t struck soon, Syriza may find itself facing pressure to cede power. 

Via Bloomberg:

Support for Greek govt’s negotiating strategy in bailout talks with creditors falls to 35% in University of Macedonia poll, broadcast on Skai TV, from 72% in Feb. survey by same pollster, 45.5% in April.

*  *  *

Full text from ESEE (Google translated)

The ESEE hopes that still remain a few days, until, at least as prevalent last view in the debate, an "honorable" agreement with creditors. The final agreement, even "moderate" to qualify or below expectations be, it is certain that will allow the Greek economy to function as a "spring", as the market will finally left free to work, the remaining months of 2015.

Until then, every day that passes, lost 22.3 mil. € of the GDP Country, every 24 hours closed 59 businesses and full-time employment decreased by 613 jobs. The market is at a standstill and has literally "dry" and liquidity injections are not able to revive. Now wants "blood transfusion" at least 25 billion euros to reboot after losses in the first five months will hardly replenish in 2015. Typically, mention that the last five years, there was a fall in turnover in retail trade -26.2% wholesale -37.1% and -61.9% in cars. The current account surplus was marginally by 0.9% of GDP in 2014, imports and exports of goods to show a rise of 4.7% and 4.9% respectively.   Regarding the liquidity in the market, 95% of loan requests rejected daily by commercial banks, on mandates and rules of the ECB in T.t.E. Now only 1 in 10, SME asks disappointed lending systemic banks. The absorption of financial tools for business liquidity does not exceed 40% and trade finance only 12%!

The deposits in Greek banks is around 138 billion €, almost 58% of total loans loans totaling € 219 billion. At least 1/8 of deposits banks have borrowed to the State, for the renewal of Treasury bills. The deposits are gone, calculated from December until today to 35 billion €, of which € 4 billion in April. Banks are their limits and available are not adequate due to shifting commitments. Liquidity no more than 2.5 billion €, while the daily needs of the systemic banks covered with the dropper by ELA. In addition, recorded negative credit growth over 52 months, with current levels at -2.5%. Since last year's corresponding March, less by 639 million. €, provided by the banks to the real economy. Also there was an increase of loans in the "red" in the years 2013-14 by 32%, while the € 77 billion at the end of 2014, now stand at € 80-82 billion, of which € 42 billion is business loans, € 28bn mortgages and the remaining € 12 billion consumer. Of the € 23 billion of loans in the media, the € 10 billion are in the red, with a repayment delay rate to 43%. In the first four months of the year, the budget shows surprisingly, primary surplus amounting to € 2,16 billion, when the forecasts were to form a primary deficit of the order of 287 mil. EUR. Expenditure is approximately EUR 2 billion below the target, confirming that the government has moved to "internal default", but which has resulted in a "suffocating" the domestic economy. Moreover, the public debt rose to 177.1% of GDP 2014 and reducing the budget deficit to 3.5% of GDP from 15.6% in 2009. We have revised the growth estimate for 2015 from 2.5% to 0.5% or 0.2% and estimates of reduction in the primary surplus by 50% from € 2,4 billion in 2014 to € 1,2 billion. The overdue obligations amounted to € 4,4 billion, with € 688 m. For outstanding tax returns, while the deficit in the pension funds amounted to € 349 m. In 2015 from a surplus of € 798 m. In 2014. In the period from 2009 to 2014 the decrease of GDP It reached 24.6% and is estimated at around € 179 billion in 2014. With regard to deflation, for more than two years, stood at around -2.1% in April 2015, compared with -1.3% in 2014. Specifically, deflationary trends are due to decreases recorded in a series of individual indicators: -6.8% in Housing, Transport -4.0%, -3.3% on other goods and services -3.1% Education, -2.1% in Health, -2.0% in Clothing and footwear, -1.8% in Durable goods - household goods and services, 1.8% in Recreation - Cultural activities, -0, 5% on Hotel-Cafe-Restaurant. Conversely, upward trends were recorded in other indicators: 1.9% in Alcoholic beverages and tobacco 0.9% in Food and non-alcoholic drinks. These indicators will certainly altered by the changes brought about by the implementation of the single VAT rate since September 2015. Based on the above data, the chairman of EERA Mr. Vasilis Korkidis, has repeatedly stressed that both the economic as and political time ends and dangerous to reach a viable agreement with our partners is a key challenge, as it is directly linked to the country's ability to raise funds from the European financial tools. The real challenge, however, for the market, but for the majority of Greek society, is what developmental conditions will be created. The position of the representatives of the productive world, on this, it is clear, as we look forward for the country, to go directly to the necessary development reforms, in partnership with the healthy elements of the economy in order to provide new, quality jobs, promoting Greece creation, innovation and openness, rather than recession, austerity and exclusion. The official position of the Greek trade and SME business is to finish the four-month standstill of the market status "No Deal, No Grexit", replacing the content of the original agreement "money for debt and thanks for the Country" in the economic strategy "Money for the purchase and development of Country" .

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HedgeAccordingly's picture


“It does look as though

we’re getting towards an ultimatum which perhaps will force the issue as far as the two sides are concerned,” said head of strategy at CIB, Jeremy Stretch.


Haus-Targaryen's picture

There are still 613 full time jobs in Greece!? 

Looney's picture

Doesn’t Greece remind you of Whitney Houston’s brain-dead daughter kept alive because of lots and lots of money involved?

Strange and sick times we live in. Hmmm…


macholatte's picture


Seriously... is there any upside anywhere for the Greeks?


Budnacho's picture

Only when they are lying face-down....

Nussi34's picture

That is what it is like getting sober after a debt financed party!

Wolferl's picture

Throw those pathetic Greeks out of Europe already.

Vampyroteuthis infernalis's picture

Seriously... is there any upside anywhere for the Greeks?

For wealthy Greeks yes, for rest of the unwashed masses NO.

Perimetr's picture

The jobs of concern are those of the banksters . . .

which produces these kind of reports

Horror of horrors, default and lose the iron yolk of the banksters who are looting Greece.

Time for Greece to sign off the EU and sign on with BRICS.

KnuckleDragger-X's picture

Making a deal won't make anything better, it'll just re-arrange the deck chairs a bit. It's hard to blame anybody because everybody fucked up by the numbers and the best thing is for Greece to drop out of the EU, but that's not in the script for this little farce.....

LawsofPhysics's picture

Sure, but the question is, will this trigger a "CDS event" or not?

Fuck the useless paper-pushers.

williambanzai7's picture

Is that the Greek version of the American Chamber of Con Artists?

jomama's picture

sooo.... bullish?

Dr. Engali's picture

It's a good thing Greece never defaulted five years ago when they first got into trouble. Can you imagine how bad it would be if they didn't have all this debt hanging over them? It would be just terrible knowing that the bankers aren''t going to get their money plus plenty of interest back. Good job Greece, you're doing the right thing.

nicxios's picture

But if Greece takes on more loans to pay off old loans and in the meantime cuts wages further, everything will be magically good. ESEE please change acronym to FOS FULL OF SHIT.

SpanishGoop's picture

ESEE is urging the government in dramatic terms to reach a deal with Greece’s creditors even if it’s not a great deal.


“A final agreement, even if it is mediocre or below expectations, is certain to allow the Greek economy to feel free at last to operate for the remainder of 2015,” read Monday’s ESEE statement. “Financial and pol.."


The ESEE is right, that is what Greece needs, short term thinking.



walküre's picture

Translation: Greece, just hold on until September 2015 when SHTF and the casino is dealing with a new deck of cards.

Kreditanstalt's picture

If the 613 "jobs" are dependent on a 'debt deal' (MOAR DEBT) how can they be "jobs"?


Sound more like "misallocations of capital" to me...

LawsofPhysics's picture

Bingo, eCONomies have become inefficient, period.  Far too many useless overcompensated fucking paper-pushers standing between the printer/computer and the producer/consumer in the real econony.

Fuck em.

Joebloinvestor's picture

Expect Greece to promise anything and implement nothing.

Notice no announcement of a hiring freeze in government?

In fact, they announced a RE-HIRING, but I guess they forgot to tell the new employees that paychecks are going to be delayed or siezed.

Greece, the lamprey eel of the EU.

Kirk2NCC1701's picture

Given yesterday's ZH article on national debts, I am puzzled as to why we aren't talking about Ireland or Singapore, where the Per Capita and % of GDP is waaay higher than that of Greece. 

walküre's picture

Ireland and Singapore can service their debts. Tax avoidance is not an Olympic discipline in either Ireland or Singapore. Greeks don't pay taxes. There is no money in the government unless that money comes from 3rd party sources (international debt) or from a mafia like oligarchy which runs the country.

Greece has run out of other people's money and is now broke. The creditors know this and just have to come to terms of how badly they've been fucked by Greek governments.

Greek history shows that there's never been a vast effort to collecting taxes which is why maintaining a 1st rate welfare state is completely out of the question for this country.

Comte d'herblay's picture

Budgie Twitters, Math genius extraordinaire says, it's 612 jobs. 

LawsofPhysics's picture

LOL!  In the "official" market perhaps.  On the other hand, the black market is booming!

Free_Spirit's picture

Yet they are still trawling every bin for whatever cash they have left to hand back to the IMF and ECB, instead of burying it for when they need hard currency and the drachma is establishing a level. This country actually wants bankruptcy. Its like the deranged cult minister who insists on his cult destroying everything before committing suicide.

wmbz's picture

Banksters Inc. must smell a few more coins to be bilked from the Greeks. 

What a pathetic mess, but they will keep right on digging, perhaps until they get to China!

DaveA's picture

For what purpose does Greece need all this financing? So it can continue to enjoy a first-world lifestyle on a third-world income?

Tear gas and burning tires, I love the smell democratic welfare states give off when their fundamental contradictions are exposed.

falak pema's picture

the Grapes of Wrath will hit the streets of Athens  as the frothy waves of sterile debate engulf those behind the Troika in stalemate.

A life for a dime vs a million privations to save banksters' crimes. That's the new face of reality in the mad race to define Greece's date with destiny. 

Fate has no compassion for human collateral anywhere. Blink or sink !

are we there yet's picture

Greece is boring now. Their leaders have run out of greater fools to dupe and are just making noises.