By Yiannis Papadoyiannis

The role of the credit system in the consumer model that came to dominate Greece in recent years, at the expense of production and the real economy, is revealed by the details of loans issued.

The sum of the banking sector’s loans to economic domains such as agriculture (1.5 billion euros), tourism (7.3 billion) and shipping (14.2 billion), where the country holds a comparative advantage, comes to just 23 billion euros, while consumer loans in the same years exceeded 32 billion euros, according to official figures.

In fact, the consumer loans issued are 45 percent higher than those provided to the industrial sector and a staggering 215 percent more than those to the construction sector. Loans to mass media companies were twice as high as those issued for agricultural development, and loans for the acquisition of cars are estimated at 5 billion euros.

The above does not include non-performing loans that banks have now written off, many of which concerned credit provided to friends, relatives and other such recipients.

The picture painted by the structure of loan portfolios clarifies the general responsibility of the political and economic system in the expansion of the model of overconsumption. Some 14 percent of all loans today (which add up to 231.8 billion euros) concern consumer credit, while another 75 billion euros (or 32.4 percent of the whole) has been given to households to cover housing needs. Combined with Greeks’ traditional affinity for homeownership, this massive transfer of funds led to huge expansion in housing development – in Attica in particular – and to a rise in prices even in areas that had no access to modern public transport means or green spaces.

Bank officials tell Kathimerini that the credit sector clearly carries a share of the responsibility in the emphasis placed on issuing consumer loans. However they note that banks are not responsible for drafting policies or for the quality of business initiatives, saying that creditable borrowers are also largely to blame. “It’s not the banks’ fault if the average Greek has abandoned agriculture in favor of opening cafes and so on,” one source said.