ECONOMY

Greeks take to euros naturally

A week after the roll-out of euro coins and notes in their physical form, the overwhelming majority of Greeks have taken to the new currency like ducks to water, according to polls conducted by the Economy and Finance Ministry. Eight in 10 Greeks have stocked up on euros while seven in 10 have already conducted at least one transaction with the new currency, Economy and Finance Minister Nikos Christodoulakis said yesterday, underlining the growing acceptance of the euro among the local population. Greeks’ willingness to abandon the drachma for the new currency was already evident just four days after the introduction of the euro. According to the European Commission, Greece and the Netherlands led the eurozone in the high usage of the currency over the four-day period. It said that euro-denominated transactions in the two countries exceeded 80 percent against 50-65 percent in six countries and 25-50 percent in other member states. The smooth conversion process contradicted earlier concerns that Greeks could be less than ready for the switchover to the euro on January 1 this year. Nineteen days before the launch, a Eurobarometer survey found that Greeks were one of the least informed peoples in the eurozone on the new currency. Despite the relative smooth changeover, there are still some minor problems, Christodoulakis said, one being the disproportionate demand for coins in certain districts with the bulk of the requests coming from small and medium-sized enterprises (SMEs). The problem, however, was only to be expected in view of the procrastination among SMEs in equipping themselves with the euro. Ministry statistics showed that just five days before the circulation of the new currency, only a fifth of SMEs had obtained starter kits, unlike Greeks who had rushed to purchase the euro packs when they were offered to the public in mid-December. In the meantime, the drachma could disappear into history faster than expected as to date, the Bank of Greece has taken in 600 billion drachmas, corresponding to 20 percent of the Greek currency circulating in the country. BoG Governor Lucas Papademos told the online site of Flash radio over the weekend that some 500 billion drachmas had been withdrawn from circulation, leading to speculation that the national currency could vanish by the end of the month, a month earlier than had been anticipated. Like the majority of countries in the eurozone, Greece has set a February 28 deadline for the national currency as legal tender, after which the euro will be the sole currency in use. The new currency, however, could stoke up inflationary pressures, already expected to flare up following soaring vegetable and fruit prices in the wake of the unprecedented bad weather of last week. November prices fell to a year-low of 2.4 percent while December figures are due to be released on Thursday. Referring to instances of unwarranted price increases and retailers rounding off their euro prices, Christodoulakis said that such cases were isolated. He said that Greece was not alone in facing this problem as other eurozone countries have reported similar experiences.