By Timothy Spyrou
WE are now approaching the six month anniversary of the decision to adopt the language and posture of national resistance in response to the deposit-tax/bail in proposal put forward by the troika.
It is time to climb up a hill, pause, take out a pair of binoculars so that we can survey the results. I, however, can survey the results by merely stepping out my front door to take my dog for a walk. And what I see is the economic decimation of my neighbourhood.
The shopkeeper lives right below my apartment. He was a successful small businessman who had invested in three different markets. The first was the supply of discount foodstuffs and beverages to local restaurants, cafes, bars and hotels.
The second consisted of low to middle income Cypriot families who take advantage of the general store on their street. This market also served the growing population of immigrants from Eastern Europe [the owner can speak Bulgarian fluently, and knows a little bit of Russian, Romanian and a couple of other languages] as well as the Asian domestic workers doing their shopping on their days off.
The third line of trade in his operation as a sort of off-licence. The shop is actually quite big, and he has a big storeroom in the basement, as well as a couple of small trucks which he uses to deliver supplies.
Unfortunately, his business has suffered in a variety of ways. Firstly, he is struggling with suppliers.
Whether I want to buy 7 Days croissants and Snickers ice cream to indulge my sweet tooth, or I want to buy Danone’s blueberry yoghurt to live healthily [and indulge my sweet tooth], or I want to buy iced tea and turkey burgers, I often find that the goods are not in stock because the shopkeeper’s suppliers have either lost money from the Laiki bankruptcy and the BoC haircut, or their funds are tied up because of their capital controls. Some of these suppliers were in difficulty already because of providing credit to Orphanides supermarkets.
What makes it even more galling for the store owner, is that, he had often paid for the supplies in advance, meaning he is not only losing business, he is unable to search for a more secure supply line. It doesn’t help matters that he can’t use his savings because of capital controls. In acting as a supplier to a range of establishments himself, he had also often extended credit to other businesses.
He isn’t sure of the amount he’s owed, as he fears adding it all up will give him a heart attack, but, it could be anywhere between €40,000 and €60,000. There is a good chance that a significant portion will never be paid back, because some of those establishments may be closing up as we speak. My friend is currently fighting for his economic survival. Even if the landlord lowers the rent, it is still unclear whether the general store will still be open six months from now.
THE FAMILY BAKERY
This bakery has been a pillar of my neighbourhood for over two decades, and it was well known outside the area. It had a range of products that appealed to middle class families and to people who wished to pick up a snack on their way to work.
The owners saved their money and they also put three children through university in Britain, and, to the best of their ability, managed to avoid debt.
The already-year-and-a half long recession had damaged their business. However, one day, my father, whose small takeaway they had supplied got a rude shock.
He saw workmen taking down the sign, and the owner’s wife looking forlorn. My father, not believing what he was seeing, not only asked for his bread, but also asked to confirm the order for the next week. The lady looked at him and said “Next week? Don’t you see that I am closing down? You are lucky to get this week’s supply.” My father, coming home dazed, mumbled something that they found their business unviable.
Since the owners were hardly the types to opt for early retirement, and clearly enjoyed their work, it is probable that they lost their money in one of the banks, or found it too difficult to operate without their working capital. It could also be that they experienced a rapid decline in business because of the decline in the desire to indulge. Fortunately for them, they were able to recoup some of their losses by selling the business to a chain of bakeries.
However, it is a sad state of affairs to be forced to sell one’s family business because of the decisions made by a bunch of politicians “full of sound and fury, signifying nothing.” Also, already, the new bakery, in response to market conditions, has eliminated some products on offer. Oh, and my father isn’t really satisfied with the baguettes from another baker, and claims that the bread from the new baker isn’t even worth putting in his car to drive to his take away, let alone make steak sandwiches.
THE TAXI DRIVER
My old friend and taxi driver has also suffered. Actually, he hasn’t suffered directly yet, but he probably will. He has a son who had been unemployed for 13 months. He was a salesman who lost his job because his employer was one of the wholesalers who had extended credit to Orphanides, and they had to downsize.
The young man, a divorced father of one, had to move back in with his parents because he couldn’t pay the rent and provide for his kid on unemployment benefit that lasts for only six months.
His luck changed and he found another sales job and felt confident enough to move out on his own again. That was in late January. Last week, his father the taxi driver told me: “I doubt that the new job is going to last long. Since the trouble happened, he has told me that his new boss has become very demanding and rude.”
In other words, unless my friend’s son gets engaged to his more economically secure girlfriend (who may not be that economically secure at present either), he is going to be back on his father’s couch and it will be the grandfather who will be providing.
A nice lady bequeathed a cluttered and tiny Greek language bookshop and stationery store to her son. When the DVD rental outlet next door moved, the fellow decided it was a good opportunity to expand the bookshop.
A shop that was sometimes dark because it was so cluttered would expand into a nicely furnished, beautifully arranged shop that provided a welcoming atmosphere to families looking for books for their kids, educated people looking for English-language books translated into Greek, from a book about Venice to the latest John le Carré and Stephen King.
I would love going into the shop and spending time browsing. However, despite their enthusiasm, the family faced difficulty as the economy worsened over the last three years of Christofias’ term. Also, my neighbourhood’s demographics aren’t really suitable for an especially nice bookshop.
However, they carried on. That is, until the haircut. Realising that they were going to have more difficulty than before to pay back their loans having lost access to some of their capital, they decided to cut their losses.
Within 50 days, they had moved everything out of the extension, terminated the rental agreement, and, with the landlord, had rebuilt the dividing wall. Although my mom politely tried to make the bookstore owner’s mother feel better, by saying it was for the best, there was no way that the pain could be alleviated from the woman’s face and there was no way that the son could hide his humiliation.
Although his kiosk is better compared to some, people are not only buying fewer newspapers, they are also trying to make do with what they have.
When they go to the kiosk to get a newspaper, they may skip buying a couple of cans of coffee and the latest magazine editions. However, that is not the main reason why his family’s finances are worrisome. He had invested a lot of money in his children’s education. He had sent his daughter first to France, and then to Britain, to study. She couldn’t get a job in her chosen field, but eventually she managed to land on her feet at a major company.
But the business climate is so uncertain, the company, which had just moved into a brand new office building before the haircut, may decide to downsize, and she will be back working at her father’s kiosk.
The kiosk owner had sent his son to study corporate law and finance. He also encouraged his son to study Russian. Imagine his indignation, when he discovered, that, far from protecting the interests of his son’s future clients, Parliament, through their brave defiance, achieved a 47 to 90 per cent haircut for wealthy Russian depositors, because they were afraid a 10 per cent deposit tax would scare away Russian investment.
THE ALMOST CAFE
Down the other side of the street, right at the juncture, there was a budding and enthusiastic small business that promised to be nutritiously rich. According to rumour, it was going to be something like a café that would sell a range of juices, smoothies and frozen yoghurts. Previously, the space had been rented by a shoe shop.
I would pass the spot at least every couple of weeks as I went about my errands. Aside from being a better sight than a dusty and empty shop, it also added some much needed colour to the neighbourhood. However, suddenly, the work stopped. I thought that maybe they were experiencing some last minute complications, but week after week, I pass by and see absolutely no activity. It still has the delicious and healthy looking sign, but it is beginning to look dusty, empty and forlorn again. Is it possible that this would-be small business owner’s dreams too were crushed?
So there we have it. Our politicians’ combination of indecisiveness, populism and desire to play the hero has resulted in the patient having to amputate his gangrene ridden leg when he could have sought timely treatment earlier if he had been willing to pay the money. Just as that patient has been decimated physically, so have our neighbourhoods faced economic decimation. Nice work, folks.