The Greek debt crisis isn’t scaring off sun-hungry Norwegian tourists. They’re more worried about a cold and wet summer at home and are flocking to Greece like never before, likely armed with some extra cash.
The runs on Greek banks in recent days have set off warnings that it may be difficult to withdraw cash from automated teller machines in Greece. The thousands of Norwegians set to fly off on Greek holidays have thus been advised to have extra supplies of euros in cash with them, in case the banking system breaks down.
Greek businesses and households have been emptying their bank accouts as their country’s debt crisis reaches a new climax. Banks may impose more limits on withdrawals “to prevent the banks from running out of money in a panic situation,” Øystein Dørum, chief economist at Norway’s biggest bank, DNB, told Norwegian Broadcasting (NRK). “Then there would be a risk that the Greek banking sector could collapse, and the consequence is that it would be impossible to get money out of the bank machines. I don’t think that will happen any time soon, but capital controls may be imposed. There is a real risk that the banking system won’t function as normal, so folks should take more cash with them than they otherwise would.”
Even if Greece were to pull out of the euro zone, though, Dørum said Greece would “probably continue to use the euro” until a new Greek currency could be introduced. Norwegian and other tourists will thus likely be able to keep using euros in Greece through the summer, even if the country is declared bankrupt.
Magne Gundersen, consumer economist at SpareBank 1, downplayed the euro risk, claiming that Greek authorities would only add to their economic woes if they pulled out of the euro zone during the important summer tourism season. Tourists “can certainly take extra cash with them, but I don’t think it’s necessary. The country isn’t going to collapse during the seven- to 14 days you’re on holiday.”
Norway’s largest tourist destination
Charter tour operators have been reporting record numbers of Norwegians heading for Greece this year, not least after the cold spring and early summer in Norway. NRK reported that around 275,000 charter tourists are expected to travel to Greece this summer, making Greece this summer’s largest tourist destination for Norwegians. Four out of 10 who travel on packages that include flights and hotels choose a Greek holiday.
“We’ve seen enormous demand,” Tonje Fossum of charter tour operator Ving told NRK “It seems like the weather in Norway scares Norwegians more than any Greek unrest.” She said that Ving hadn’t experienced any cancellations of trips to Greece because of the economic uncertainty.
Fossum is also advising Norwegians to travel with “a bit extra cash, not piles of money, but I would take more, leave it in a safe and pay with cash where you can.” Those traveling with charter operators already have paid for their hotels and often many meals and even rental cars, though, so face mostly incidental expenses while actually on holiday. Both Ving and Star Tour said they had “good contact” with Greek tourism authorities and reported that in tourist areas, banks and automated teller machines were operating as normal.
That was confirmed by Jo Fjær, a Norwegian who owns and runs an independent hotel on Crete. He told newspaper Dagens Næringsliv (DN) on Monday that he had no problem filling his rooms but did face new taxes that had doubled his costs. He said hotels that don’t have agreements with charter operators were suffering because of a fall-off in tourists from other countries, whereas his Norwegian market was still strong. He stressed that banks on Crete were functioning as normal, that pharmacies are private and wouldn’t run out of medicine and that “there’s food in the grocery stores.”