Remember that Sunday, on June 28th, a year ago? Remember the queues outside ATMs growing in a quick and non-stop pace? It was a day after Prime Minister Alexis Tsipras had announced a Referendum amid suffocating pressure from the European Union, financial dry out by the European Central Bank and a climate of scaremongering, fear and insecurity among citizens.
In a dramatic appeal to Greeks, Tsipras urged Greeks to “calm down!” and said
“the EUrogroup’s decision to not extend Program and the ECB decision tp not increase the ELA forced the Bank of Greece to propose capital controls.”
Warning signs that Banks would go on extended bank holiday had been rumored since Friday afternoon and had Greeks rushing to ATMs to withdraw as much money as they could from their deposits. Rumor had it that a specific Greek bank had limited cash withdrawals from ATMs.
When Tsipras announced the Referendum at 1 o’ clock in the morning, some Greeks went to withdraw money even at 3 a.m.
Then Sunday afternoon the official announcement: The Greek Systemic Stability Council had to impose capital controls and close the banks as of Monday, 29th June 2015.
The long queues outside the ATMs continued over night.
Monday found half of Greeks at the ATMs and the other half at petrol stations for full tank and supermarkets grabbing staples like rice, pasta, flour and oil.
Outside a bank branch
Inside a supermarket.
In the following days and under the extreme financial insecurity, Greeks were exposed to an unbelievable campaign to Vote YES in the Referendum and accept Juncker’s bailout austerity. The EC President even addressed Greeks saying he unbelievable phrase “Tsipras lied to you, vote YES.”
Especially,German officials were hidden inside the ATMS to scare the hell of Greeks and have them vote YES! —- OK, that’s a caricature 🙂
On 5. July 2015, the Referendum took place with 61.31% of Greek to have voted NO and rejected the bailout conditions, an austerity measures plan tabled by the EC and the Eurogroup but clearly written by the German Finance Ministry that gave the tune and every other European followed.
The Referendum result was simply ignored by the Prime Minister. He continued bailout negotiations with the EU and the Eurogroup.
Neither the European Commission nor the European Parliament President nor the 6 founding members of EU came out to urge Tsipras to “respect the will of the people” as they did with the Brexit Vote.
That’s bitter. And dishonest. “Democratic” double-standards. But that’s the EU’s development in the last couple of years.
A year after, on June 28th 2016, capital controls remain in position and thus with the same daily withdrawal cap as on June 29th 2015. Sixty euro per day or 420 per week. Some restrictions have been relaxed.
In the meantime, the government signed a new, the third bailout agreement for 86 billion euro and brought additional austerity measures.
It was the price for remain in the euro zone.
“Was it worth it?” somebody asked me on Twitter. I answered: ” if you had enough deposit in the bank and you have been able to withdraw 365 days x 60 euro = €21,900 in a year without having to see your 21,900 euro violently converted into a devalued Drachmas … it was.
My point was and remains for the time being that
the momentum for Greece to leave the eurozone area was in before May 2010, before the first Memorandum of Understanding, Loan Agreement and Austerity.
I doubt that the damage of the capital controls to real economy has been recorded yet. Or better say: attempts to records are not trustworthy.
Several big company owners have made it into tradition to blame the capital controls for their bankruptcy, but we all know that they were in trouble long before the capital controls due to mismanagement and loans that they could not service while the banks have been demanding repayments.
The banks were rescued with the capital controls and the EU’s bailout money. But confidence to banks and the system has been destroyed. And this confidence hasn’t been restored yet. The shock sits still deep in the Greek soul.
The dramatic June of 2015 here via KTG’s posts
PS some Greeks are relieved to see in today’s EU Summit it’s not Greece high on the European partners bullying agenda but another EU member country – for a change…