A ray of light in the gloom...

The news from Greece is not good this week, to say the very least. An estimated 100,000 people took part in the march in central Athens to protest austerity measures being pushed through by the government and sadly three people died in the ensuing mayhem.

The measures were instituted at the insistence of the EU and the IMF (International Monetary Fund). Greece's inability to keep borrowing at exorbitant rates, coupled with the delay in decisive action to remedy the situation, led to the rapid collapse of the Greek bond market. This in turn affected Portugal and Spain, driving the euro lower against the dollar and sterling and prompting losses on all Western European stock markets and Wall Street.

There is a great deal of bitterness in Greece as people feel that the man in the street will have to pay for years of corruption and prevarication by greedy and/or incompetent politicians. Prime Minister George Papandreou talks of the need for ‘decisive’ action as Greece earns an 11th-hour respite with EU-IMF aid package set at 120 billion euros over three ‘harsh’ years - but will he have the guts to push unpopular legislation through? Will the opposition put petty politics aside and put the country first? It remains to be seen…

What we sometimes lose sight of is how the economy is tied up with politics. As an example, close to 1,000 tourists on a cruise ship were stopped from disembarking in Piraeus by Greek unionists, protesting planned legislation that will allow cruise ships with foreign crews to dock in Greek ports. This prompted the cruise company to warn that it may suspend visits to Piraeus.

You don’t have to be Einstein to work out that, if this occurs, at least 1,000 tourists per week will no longer visit Athens as part of their Mediterranean cruise, and that’s just one cruise liner. It means that the alighting passengers will not eat at restaurants, visit museums or buy souvenirs – and bear in mind that tourism forms the backbone of Greece’s economy.

It does seem that there is a singular lack of forethought as to how strike action and protest marches will effect the economy – mind you, I suppose the same could be said about the BA strikes at a time when BA is struggling to keep afloat. Add to this the natural disaster of volcanic ash making tourists wary of travelling to Europe and it really does seem a recipe for financial disaster when Greece relies so heavily on turism.

All this would seem to be unremittingly gloomy, but interestingly enough, if you are in the process of buying property abroad right now it may not be.

On Wednesday sterling hit €1.16/£1 against the euro. If there is one single thing that you can do right now to protect yourself, it is to sign up with a reputable currency company like Smart Currency and consider ‘forward buying’ your currency. As Smart mentioned in an email sent out to all clients, and I quote: ” Even though the European Central Bank and the IMF say they have agreed a debt rescue package for the Greeks the markets remain unconvinced. And problems are spreading to other European countries such as Spain and Portugal, whose debts are much greater than the Greeks.”

You can buy currency at today’s rate for up to a year in the future. This means effectively that you will know in advance exactly how much your currency transfers will cost you. You will not have to be in the hands of whatever financial disaster may arise, and that includes any problems that may hit the UK. Frankly, the wisest course of action would be to pick up the phone and have a chat to a currency expert about this. Right now! Go to www.smartcurrencyexchange.com

Let me know how your plans to visit or buy in Greece are going. I am planning a visit in August and I can’t wait! Any ideas out there – what’s your favourite place? I’m toying with the idea of Hydra, Evia or perhaps Corfu…?

Take care…bye for now!

Carol.
www.greecebuyingguide.com