The situation in Greece has stabilized as the banks reopened and the country started to settle its debt obligations to the international creditors.
The circumstances in the country are still not of the easiest. The capital controls such as transferring money abroad, have not been lifted still. The only adjustment which was made is changing the limits on cash withdrawals to 420 euro per week, replacing the previous measure of 60 euro daily.
The Endeavour Greece, non-profit entrepreneurship support organization, has presented the research on the new settings of the business environment in the country, based on the survey made among 300 Greek companies. The report suggests, 58% of the enterprises were negatively influenced by the lately imposed restrictions due to inability to pay for the row materials to suppliers as well as customer restrained ability to pay because of the cash withdrawals limitations.
Furthermore, 69% of the businesses suffered significant sales decline, 18% of which the decrease was more than 50%. Around 45% of the companies were forced to postpone payments to suppliers, which affected the businesses further, pushing them to use overseas accounts instead. In the fear of further deterioration of the economic conditions, many companies have been reducing their operations costs. Nearly the quarter of the Greek companies, 23% are planning to transfer their headquarters abroad so to be able to ensure safety, liquidity and stability of their ventures.
The biggest challenge for the Greek government now is to implement the new reforms agreed in the recently signed deal, which is projected to be quite challenging. Unless it is successful however, it might lead the left led coalition to dissolve. The talks of the early elections are gaining the strength. Nikos Kotzias, the Greece foreign minister, believes that the new elections are inevitable in the early autumn because the government cannot rely on the packing by the opposition parties. There is a possibility the measures to be rejected by the objectors, which would possibly lead to the government collapse.
Last week Syriza saw its support decreasing from 149 to 123 MPs, as the new aid package of 86 billion euro had being agreed on. The reforms will see changes mainly in the country’s pension system and VAT structure. Alexis Tsipras, the Greek Prime Minister, therefore faces the double challenge, as from one side he has to push the new reforms through and on the other to convince the opposition to support the deal.