Euro zone loses patience with Greece

Sat Feb 4, 2012 6:38pm EST

BRUSSELS (Reuters) – Euro zone finance ministers told Greece on Saturday it could not go ahead with an agreed deal to restructure privately-held debt until it guaranteed it would implement reforms needed to secure a second financing package from the euro zone and the IMF.

Euro zone ministers had hoped to meet on Monday to finalize the second Greek bailout, which has to be in place by mid-March if Athens is to avoid a chaotic default. But the meeting was postponed because of Greek reluctance to commit to reforms.

Instead, the ministers held a conference call on Saturday to take stock of progress on the second financing package, which euro zone leaders set at 130 billion euros back in October.

“There was a very clear message that was conveyed from all participants of the teleconference … to the Greeks that enough is enough,” one euro zone official said. “There is a great sense of frustration that they are dragging their feet.

“They should get their act together and start talking honestly, decisively and speedily with the Troika on the aspects of the programme that remain to be finalized – on fiscal and labor market reforms,” the official said.

The Troika are the representatives of the European Commission, the European Central Bank and the International Monetary Fund, who have prepared a Greek debt sustainability analysis on which the second financing programme will be based.

“The main issue is the lack of reform, or prior action, in Greece,” a second euro zone official said.

Euro zone ministers were also dissatisfied with Greek Finance Minister Evangelos Venizelos because they believed the minister was paying more attention to his position within his party ahead of the April elections, than to talks about reforms.

“There is a great sense of frustration with Minister Venizelos, who is very hard to get hold of because he is very busy campaigning for the leadership of (the Greek party) PASOK, so he is not available to meet with Troika members,” the first official said.

“He is preparing his own political future, rather than the future of his country. People are seriously disgruntled about that and have conveyed this very clearly to him this afternoon,” the official said.

“There is an increasing sense of frustration that why should we honour our part of the bargain, which we have in the past, while Greece does not seem to care that much, and has not delivered their part of the bargain,” the official said.


In Athens, Venizelos admitted to a growing sense of impatience with the Greeks.

“There is great impatience and great pressure not only from the three institutions that make up the troika but also from euro zone member states,” Venizelos said after what he called a “very difficult” conference call with euro zone counterparts.

“The moment is very crucial. Everything should be concluded by tomorrow night.”

Jean-Claude Juncker, who chairs the Eurogroup of euro zone finance ministers, voiced the possibility of default.

“If we were to establish that everything has gone wrong in Greece, there would be no new programme, and that would mean that in March they have to declare bankruptcy,” he said in advance copy of comments to news weekly Der Spiegel.

Greece has secured a debt restructuring deal with private creditors to halve the value of Greek debt in nominal terms and in exchange receive new, 30 year bonds with an average coupon below 4 percent, officials said.

The restructuring is to help make Greek debt sustainable by cutting it to 120 percent of GDP in 2020 from 160 percent now.

But euro zone governments will only agree to bolster the debt restructuring, called private sector involvement (PSI), with 30 billion euros and further finance the Greek government through 2014 if Athens presses on with lagging reforms.

“The message to Greece now is very clear. The PSI as it stands now is broadly OK but we will not allow you to go ahead with the PSI unless we have guarantees that the rest of the reform to make the whole situation sustainable in the long run will be delivered,” the first official said.

“We don’t want to give them the PSI, because once we do, we surrender our leverage to obtain any more concrete commitments in terms of policy,” the official said. “Before we go ahead with the PSI … we want to have assurances that Greece is actually capable of implementing the second programme.”

Debt restructuring is likely to hit Greek banks harder than others, because they hold a lot of Greek government bonds.

Some EU officials said on Friday that euro zone governments may now have to contribute closer to 145 billion euros than the originally envisaged 130 billion to the second financing package to help recapitalise Greek banks after the bond swap.

But there is strong resistance to that idea from several countries, including paymaster Germany.

“It is highly unlikely that the overall envelope will increase,” the second official said.

“In some capitals there is absolutely no appetite whatsoever to reopen the size of the financing package,” the first official said.


Investors and some EU officials have suggested that any additional money needed to make Greek debt sustainable could come from the ECB, which holds a portfolio of around 40-50 billion euros worth of Greek paper.

The issue was not discussed at the Saturday call, however.

“This is off the table now. Everybody is saying now that before we can start discussing what the public sector can do, should do or may do, let’s talk to the Greeks about what they are prepared to do,” the first official said.

“If the Greeks don’t start delivering, the question of Official Sector Involvement (OSI) is superfluous.”

International lenders to Greece would like to see a lower minimum wage, the removal of the 13th and 14th month “bonus” salary and the liberalisation of labor markets – issues that are politically difficult for Greek parties before the April elections.

“We hope that over the next 12-24-48 hours they will get their act together and … discuss these matters very urgently with the Troika,” the first official said.

Euro zone officials said that Greece, betting that the euro zone would not allow a disorderly default because of the possible repercussions across the 17-country single currency bloc, was playing a dangerous game.

“They think, that we think that the unthinkable cannot be thought. But they better think again,” the first official said.

The euro zone expects Greek politicians to come up with a consensus on reforms by Monday, but a letter committing to reforms from political parties may not be enough at this stage, the official said.

“We don’t care so much about signed letters by now, we want a clear timetable for legislative action, we would expect them to put it in legislation and pass it possibly before the end of February or in early March – that is the best guarantee – better than any signature,” the first official said.

(Editing by Mike Peacock)

Peter’s Post: get me to the Greek

Our travel expert answers queries on routes and destinations around the world

We are flying to Istanbul in June and want to visit Mykonos and Santorini in Greece. Are there direct flights between Istanbul and either of these? If so, what would a return ticket cost? Also, what should we expect to pay for a double room or studio at this time and do we need to book? – Janine De Waal

There are no direct scheduled flights between Istanbul and Mykonos or Santorini. However, you can fly via Athens to either island. The most convenient airline is likely to be Aegean ( I did a trial booking and could get a flight leaving Istanbul at 4pm, arriving in Mykonos around three hours later, with a 70-minute stopover in Athens. The return fare was a rather expensive R3151. Flights from Istanbul to Santorini are around the same price and take 10 minutes longer. Room prices vary wildly, depending on demand and, sometimes, on your bartering ability. You can find some bargains, but these are two of the most popular islands in Greece. In Mykonos, you should be prepared to pay à50-à80 per night for a comfortable room in a good area. In Santorini, you can find rooms within the same price range, but you’ll pay much more for a room witha sea view. You don’t have to book in advance in June (unlike in August, when everything is full). However, it is probably worthwhile booking at least one or two nights so you’ll have somewhere to go on arrival, then decide whether you want to change rooms. See,, and


I would love to travel by train during a visit to India and am considering taking the Rajdhani Express from Mumbai to Delhi. I would appreciate any information on this service and whether it is suitable for solo women travellers. – Danni Beukes

All visitors to India should experience at least one train trip. Once you have made it through the bustling, crowded station, you can relax as you watch the sights of India go by from your air-conditioned compartment. The Rajdhani Express service from Mumbai to New Delhi takes around 16 hours and is fully air-conditioned. You leave Mumbai in the afternoon and arrive in Delhi the next morning, passing through five states. It is quite safe for travellers, whether in first or second class. There is a substantial price difference, with a second-class berth costing 1975 rupees (about R313) and first class 3305 rupees (R523). However, I think it is well worth paying the extra for first class. The price includes bedding and all meals on board. There are two types of compartments – a two-sleeper and a four-sleeper – and you can book a lower or upper berth. Be aware when booking that there are a number of Rajdhani Express services running between New Delhi and other cities in India. The Mumbai to New Delhi is run on train number 12951. See for more info.

Social media in Travel, Tourism and Hospitality: Theory, practice and cases

Social media in Travel, Tourism and Hospitality: Theory, practice and cases
Edited by Marianna Sigala, University of the Aegean, Greece, Evangelos Christou, Alexander TEI of Thessaloniki, Greece and Ulrike Gretzel, University of Wollongong, Australia

The social media, or else the Web 2.0 as it is usually called, are fundamentally changing the way travellers and tourists search, find, read and trust, as well as collaboratively produce information about tourism suppliers and tourism destinations. Moreover, applications of Web 2.0 such as, collaborative trip planning tools, social networks, and multi-player online social games, enable travellers to participate in all business operations and functions (e.g. marketing, new service development). Consequently, travelers become co-marketers, co-designers, co-producers and co-consumers of travel experiences. In using social media, the travelers co-produce and share a huge amount of information and knowledge namely user-generated-content (UGC) and/or social intelligence. The latter is useful and it has a great impact not only on travellers’ behaviour and decision-making processes, but it can also be exploited for informationalising and improving the effectiveness of business operations. For examples, firms use UGC for enhancing their customer complaints management processes, improving their environmental scanning abilities and informationalising new service development. In this vein, travel, tourism and hospitality companies are currently changing and redefining their business models and operational practices in order to exploit the business opportunities offered by social media as well as to address the expectations and the behaviour of the new travellers’ generation.

The wide application of social media by the travelers and the tourism industry alike has boomed research during the last decade. However, despite the increasing importance and impact of social media in the tourism industry, there is not any book yet addressing this topic from a holistic and overall perspective. To address this gap, this book consolidates under one cover leading-edge theory, research and case studies investigating the use and impacts of social media by both tourism demand and supply. The overall goal of this edited volume is to disseminate a coherent body of theory and practical based research that will provide insights for academics and professionals alike into the following issues: a) the profile, the behaviour and the changing roles of “travellers 2.0”, and b) the ways in which travel, tourism and hospitality firms and destination organisations are transforming their business models and operations for accommodating and exploiting UGC and social network interactions.

Book chapters are contributed by an international group of leading experts. Book chapters also represent case studies and research findings from various countries, and different types of tourism, hospitality and leisure companies, which in further enhance the contextualisation but also the generalisation of the book findings. Book chapters are organised into four sections addressing the abovementioned goals of the book.

Analytically the first section of the book aims to address the issue of the use and impact of social media in business operations and strategic models. To achieve that, the section includes four chapters providing practical examples and theoretical underpinnings on how firms can exploit social media for enhancing the following business operations and strategies: networking and collaboration; new service development; and travellers’ engagement in destination marketing. A concluding chapter of this section also discusses the factors inhibiting and/or facilitating tourism firms to exploit social media.

Given the enormous impact of social media on the marketing function, the second section of the book focuses on the use and impact of Web 2.0 tools on tourism marketing. The section features six chapters analysing the use of social media for marketing tourism destinations and individual tourism firms. Practical evidence and findings are provided from Web 2.0 enabled marketing practices of international Destination Management Organisations, meeting planners and hotels.

The third section of the book addresses the book’s aim to provide more insight into the impact of social media on travellers’ behaviour. Unless firms know how social media affect tourism behaviour, it is impossible for them to address their new needs, expectations and ways of decision-making. To that end, five chapters provide findings about the antecedents of use, the types of use and impacts of use of social media on travellers’ behaviour. In addition, book chapters address the question of whether all travellers are the same when it comes to social media perceptions and use. To that end, book chapters provide findings regarding the impact and the use of social media for different personalities, age, gender and nationalities of travellers.

Information is currently one of the most important and competitive asset of the firms and the social media provide a valuable and important tool for identifying, sharing and creating competitive intelligence. In this vein, the last section of the book focuses and analyses ways in which firms can exploit social media for enhancing their knowledge sharing and creation capabilities with external partners and firms, but also internally with their employees. To that end, three chapters provide theoretical underpinning and findings on the following issues: the use of social media for knowledge management practices; content analysis of blogs’ content; and the use of various tools for monitoring online reputation. The chapters demonstrate the use of various quantitative and qualitative methods that firms can use for exploiting UGC and informationalising their business operations.

Overall, the book provides a rich set of both theoretical background and industry evidence for exploiting and managing the impacts of social media both from a tourism demand and supply perspective. The book nicely integrates theoretical concepts with practical evidence gathered through a wide spectrum of international case studies and thorough literature reviews. The contributed book chapters also provide ideas for future research, which can hopefully further instill the readers to conduct more studies and further advance the knowledge in the field.

We hope you will enjoy reading this book.

The book editors
Marianna Sigala
Evangelos Christou
Ully Gretzel

Book Reviews:
‘Social Media in Travel, Tourism and Hospitality provides a comprehensive overview of how the rapidly developing Web 2.0 phenomenon is challenging existing customer service, marketing and promotional processes throughout our sector. Packed with examples and comprehensive analyses, the text help readers to rapidly gain an in-depth understanding of both current practices and potential future perspectives, helping them to assess the implications of such developments for their own businesses.’
Peter O’ Connor, ESSEC Business School, France

‘This is an excellent book. The focus of the book on Web 2.0 is important and timely as technology and society have converged to create tools which will have profound impact on travel. The variety of topics and depth to which issues related to Web 2.0 are discussed make it a volume that should be read by all tourism scholars. Further, it challenges both academics and industry professionals alike to consider how the quickly emerging online communities within Web 2.0 are shaping our future.’
Daniel R. Fesenmaier, Temple University, USA

‘This gripping collection of key topics in social media marketing is an extremely useful guide for tourism and hospitality researchers and practitioners alike. The latest insights into strategy development, Web 2.0 impact on user behaviour and knowledge management are illustrated with real-world case studies that will make you fit for your business.’
Christian Maurer, University of Applied Sciences Krems, Austria