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Mon, 20 Jul, 2015 12:03:12 AM FTimes – STT Report, July 20  Vesa Vihriälä, the Managing director at the Research Institute of the Finnish Economy, ETLA. File Photo Lehtikuva. Closure of banks as well as restrictions placed on withdrawal and movement of capital has hampered the Greek economy substantially, said Vesa Vihriälä, the managing director at the Research Institute of the Finnish Economy, ETLA.
According to Vihriälä, the withdrawal limit is set to remain in place until a deal on the third bailout for Greece is struck.
“Withdrawals may be restricted even afterwards. Greece is troubled by uncertainty, hence there is still the fear concerning the continuation of movement of capital from banks,” said Vihriälä.
The daily withdrawal limit in Greece is currently at 60 euros. The situation will be slightly eased next week, when it becomes possible to make all the week’s withdrawal at once.
Nordea bank chief economist, Aki Kangasharju. File Photo Lehtikuva. The bank closure has already lasted for three weeks, but they do not apply to visiting tourists. The banks are scheduled to open the doors today.
According to the Nordea bank chief economist, Aki Kangasharju, the Greek economy has taken a huge plunge.
“This is not a matter of normal citizens not accessing cash. The problem is that all the country is stuck, when companies are not able to transact with each other,” said Kangasharju.
According to media sources, the banking closure has to this point caused a 3 billion euro loss to the Greek economy.
Both Kangasharju and Vihriälä were not able to assess how big the losses have been in terms of euros.
“Nonetheless, I believe the losses to run by several percentage points in relation to the gross domestic product,” said Kangasharju.
Greeks queue to withdraw cash from an Alpha Bank ATM in Athens, Greece on July 6, 2015. Over 61 percent of Greek voters rejected fresh austerity demands on Sunday's referendum. File Photo AFP-Lehtikuva. The Greek government decided to open the banks after the European Central Bank (ECB) had raised Greece’s emergency liquidity assistance by 900 million euros. In practice, the assistance will help Greek banks remain afloat.
According to Kangasharju and Vihriälä, the banks will be congested immediately upon their opening.
“Probably, the ECB will be raising the level of the emergency funding immediately on Tuesday morning as the capital flees from the banks,” said Kangasharju.
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