Europe

Nervous Greeks worry Brexit may lead to Grexit

Greek rally against austerity in Athens, 8 May 16 Image copyright AFP
Image caption Last month Greek trade unions rallied against cuts to jobs and welfare - as they have done repeatedly

In many respects Greece has more reason than the UK to be angry with the European Union, and to want to leave.

Its people and government are embittered by the imposition of harsh austerity measures by the EU and IMF.

Those bailout conditions have brought years of deep recession and high unemployment, but have done little to reduce Greece's huge debt burden.

And as a frontline country in the migrant crisis, Greece feels let down by Brussels and EU member states, in its struggle to cope with the arrival of more than a million refugees and migrants over the past 18 months.

The anger shows in a pan-European survey published by the Pew Research Center earlier this month, in which Greeks top the table in their response to many of the questions asked.

For example, 71% of those who took part had an unfavourable view of the EU - far higher than in the UK.

More than 90% disapproved of the way the EU was handling economic issues and the migrant crisis.

Image copyright AP
Image caption The Greek islands were ill-equipped to handle the influx of migrants like these Afghans

And now with the UK having voted to become the first member state to leave the EU, an important precedent has been set.

Spectre of Grexit

So could Brexit be followed by Grexit?

On the streets of Athens, it's not hard to find people delighted by the British vote to quit the EU.

"I think the decision is very good, I think they did well," says Ionna Kokka.

"It is something we and all the other countries should also have done, because the situation is unbearable for everybody.

"There are no jobs, households are on their knees and we're being suffocated from all directions."

But these are the views of the minority, with most Greeks, like the government, still in favour of being part of the EU.

Image copyright AFP
Image caption Left-wing Prime Minister Alexis Tsipras reluctantly agreed to more painful austerity demanded by the EU

Market jitters

And yet, the risk remains of Brexit precipitating the departure of Greece from the eurozone and therefore possibly the EU.

Immediately after the UK referendum result was announced on Friday, stock markets around the world plunged, as did the value of the pound.

The Athens stock exchange was particularly hard hit, with foreign investors pulling out of some of their riskier investments in Greece.

"It's going to be a turbulent summer," says the stockbroker Nikos Chryssochoidis. "Greece needs foreign investment."

"The major problem is the Greek banking sector and these stocks have been really battered. As long as they remain at these very low levels, this poses [the question] again how viable they are."

The turbulence also means it will now be more expensive for the Greek government to borrow the money it needs.

Knock-on effects

And there are concerns about the impact the sharp fall in the pound's value could have on tourism, the country's most important industry.

Already one senior official has warned of a potential "wave of cancellations" by British holidaymakers, because the weak pound will make Greece a more expensive destination.

Around two million British tourists visit the country every year.

Image copyright Getty Images
Image caption Last summer Greeks faced restrictions on cash withdrawals amid Grexit fears

With the Greek economy already fragile, some commentators here are pessimistic.

'I think that Greece, because of the difficulties it has faced and the challenges of the (austerity) programme it has signed, will be a prime candidate for an exit from the eurozone," says the journalist and author Yannis Palaiologos.

But the stockbroker Nikos Chryssochoidis believes it's too early to evaluate the situation.

And he argues the shock of the UK departure from the EU, and the concern other countries might follow, could help Greece, because Brussels will now feel the need to tread more softly.

"Maybe you'd be more inclined to listen to what Greece has to say about the current (austerity) programme, which is very strict," he says.

"And maybe you'd be more comfortable to alleviate Greece from the burdens."

That is certainly the hope of the government here and the Greek people.

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