Economics... it’s all Greek to us?

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SPIROS Sellas is investing in an extension at his Layton bistro Go Greek, on Westcliffe Drive. Business is picking up nicely, he says, certainly sufficient to justify adding a few extra tables.

Son Jason – and, yes, he’s heard all the Argonaut jokes – is helping out while mum Glenda stocks up on provisions. Jason, 15, wants to be a commercial pilot. Nothing would please him more than ferrying Brits back to the place dad still calls home after 20 or so years living here. Athens.

But times are tougher there than here right now, and that’s saying something, in a week when long established department store chain TJ Hughes (which has a branch in Blackpool) fell into administration, chocolatier Thorntons (which also has branches across the Fylde) announced store closures, and shares in high street giants Marks and Spencer, B&Q parent Kingfisher, and Next all dropped.

Now London’s blue chips are praying Greece’s austerity measures, approved late yesterday afternoon, will ease concerns over an immediate debt default, which could drive the rest of the eurozone, Ireland included, to despair, and knock about 10 per cent off European stock markets.

The unrest on the streets of Athens seem worlds removed from the financial hell on the British high streets right now – but the Stock Exchange is an extended international financial family and any blow to one is felt by all.

If you doubt that, remember the fall-out from Iceland’s financial meltdown.

The Bank of England’s new financial watchdog, the Financial Policy Committee, has already warned this week that the eurozone’s debt crisis poses the greatest single threat to UK financial stability.

There are fewer direct ties between banks, or investors, than as in Iceland’s financial collapse, but the impact on nations such as Germany and France, with closer links, would have a knock-on effect, and lead to a tightening of bank funding conditions, who are advised to retain even more of their profits, at a time when British businesses are fighting to secure loans or extensions or more favourable lending rates.

Spiros warns: “What’s happening in Greece has implications for us all. If Greece falls, it’s like dominoes. The rest of Europe falls down too. Ireland, Spain, Portugal, Italy – they all worry. Britain too.”

With Greece at the very brink of bankruptcy, economists banked on yesterday’s Greek parliament vote on a £28bn euro (£25bn) plan to get the country back on its feet.

It was a close call, 155-138 in favour of an austerity package which pushes through tax increases and spending cuts and speeds up the hiving off of state assets under a £50bn privatisation programme.

UK Independence Party leader Nigel Farage has declared Greek democracy dead.

“The vote is a real life Greek tragedy, keeping the country imprisoned inside an unsuitable currency union and with unserviceable debts. Don’t be surprised if increasing numbers of Greek people take matters into their own hands.”

Spiros agrees: “Greece is being used like an experiment by Europe, a test case. They are making an example of us. There is a lot of anger and fear there. Things were better under the drachma, but now it is too late to turn back the clock.”

He is from Athens and fears for family and friends living there and on Corfu.

“My own brother had a good business, but not now. He’s been to Athens for work. What’s happening is very frightening, and will affect us all. You only have to turn on the television to see the riots there. I hope things calm down.

“It is not just Greece which should worry, but all of Europe. These are nervous times.”

German finance ministers had warned the Greeks to toe the line – otherwise miss out on the next tranche of aid from Europe and the International Monetary Fund to stay solvent.

The Brits had already refused to bail out Greece with a further loan.

The economic woes there, combined with fears over global economic recovery, sent the FTSE 100 Index plunging nearly 300 points this month, and wiped more than £75bn from the value of Britain’s top companies. It’s feared that if the crisis worsened, it would spread to the rest of the eurozone.

The vote went through against a backdrop of rioting, police using stun gas to quell crowds, clashing with protesters opposing more tax hikes, spending cuts and the sell-off demanded by international creditors.

Award-winning language tutor Karen Rich, also of Westcliffe Drive, works as an interpreter and teaches Greek locally and online, including courses for army wives at Weeton, due to posted to Cyprus soon. She urges local Grecophiles to “keep the faith”.

Karen, who helped co-write the BBC’s Talk Greek course, concludes: “This is the cradle of civilisation so no matter how tough times get Greece will survive. But it needs tourists and businesses to support it through the tough times.”