G-8 Leaders Hope Greece Remains in Eurozone

President Barack Obama and other leaders of the Group of Eight industrial nations expressed hope Saturday that Greece will remain in the eurozone as they huddled for a shirt-sleeves summit aimed at keeping Europe’s economic troubles from multiplying and spreading around the world.

Circling up around a table in a rustic cabin at the presidential retreat, the leaders underlined the need to keep bringing deficits down through austerity measures but also agreed that targeted spending on things like education and public works projects is needed to solve Europe’s financial crisis.

“All of us are absolutely committed to making sure that growth and stability and fiscal consolidation are part of an overall package,” Obama said.

Germany’s Angela Merkel, for her part, said growth and deficit cutting reinforced each other “and that we have to work on both threads, and the participants have made that clear, and I think that is great progress.”

The G-8 leaders’ joint statement from the woods of Camp David reflected both hope and a recognition of the daunting economic challenges they face.

“The global recovery shows signs of promise, but significant headwinds persist,” it said.

Francois Hollande, Barack Obama

The summit brought together leaders of the United States, Germany, France, Canada, Italy, Britain, Russia, and Japan in an effort to figure out how to tame Europe’s debt crisis while also increasing the demand for goods and spurring job growth.

Their statement conceded some points to Merkel’s push for austerity, saying budget deficits needed to be closed. But it added that budget cutting should “take into account countries’ evolving economic conditions and underpin confidence and economic recovery.” That suggested a willingness to let indebted countries take more time to reduce their deficits in line with eurozone rules in order to lessen the deadening impact of cuts on the economy.

“The right measures are not the same for each of us,” their statement said.

Their statement of support for Greece remaining in the euro underlined the potential and unpredictable damage to the global financial system that could come from a Greece departure. It follows a week of increasing speculation that Greece might not be able to stay the course.

Obama chose the secluded Camp David setting in part to give leaders a chance for an intimate and freewheeling discussion out of sight of most media and far from the raucous protests that have accompanied previous meetings of the G-8. Obama and his counterparts emerged briefly at midday for a group photo, strolling down from a cabin straddling a golf green with a sand bunker.

“Everybody give them one wave,” Obama instructed the assembled leaders as they lined up for their official photo. “Let’s look happy.”

The setting gave the leaders a chance for informal walks and private exchanges on the cabin’s patios on a warm spring day. Newly elected French President Francois Hollande said there had been “great frankness” in the discussions, and that leaders weren’t digging in their heels on their respective positions.

First lady Michelle Obama, meanwhile, treated the leaders’ spouses to lunch at the White House and a tour of its historic state rooms.


Euro crisis: Should I cancel my vacation?


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Tourists enjoy crystal-blue waters at Balos beach in northwestern Crete.Tourists enjoy crystal-blue waters at Balos beach in northwestern Crete.

Despite protests elsewhere in Athens, tourists visit the Parthenon on the Acropolis in February 2012.Despite protests elsewhere in Athens, tourists visit the Parthenon on the Acropolis in February 2012.

A man walks along the waterfront in Aigio, Greece, on March 31, 2010 A man walks along the waterfront in Aigio, Greece, on March 31, 2010

The statue of King Leonidas of ancient Sparta stands over the battlefield of Thermopylae, some 170 kilometres north of Athens.The statue of King Leonidas of ancient Sparta stands over the battlefield of Thermopylae, some 170 kilometres north of Athens.

Ancient Olympia in Greece, pictured in 2007 during a spate of brush fires, is the site of the original Olympic Games.Ancient Olympia in Greece, pictured in 2007 during a spate of brush fires, is the site of the original Olympic Games.

Tourists enjoy clear blue sky amid palm trees on an unusually quiet Costa del Sol Carihuela beach in Torremolinos, Spain in August 2009.Tourists enjoy clear blue sky amid palm trees on an unusually quiet Costa del Sol Carihuela beach in Torremolinos, Spain in August 2009.

Tourists visit Sao Jorge Castle in Lisbon, Portugal in July 2008.Tourists visit Sao Jorge Castle in Lisbon, Portugal in July 2008.


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(CNN) — In the last decade of the 20th century, the Turkish lira fell in value 1,000 times against the U.S. dollar, meaning that tourists returning to that country after several years found that any old money they still possessed since their last visit had become almost worthless.

Now as fears grow about whether Greece will stay in the euro, and the possible domino effect this could cause, many prospective holidaymakers appear to be having second thoughts about visiting that country and other economically troubled members of the 17-nation eurozone, such as Spain or Portugal.

And while tourists may be bulking up their cash reserves in the case of a euro exit, others may be concerned about safety if violent street protests resume against austerity cuts.

What is the financial situation now?


Greeks withdraw cash from banks


What’s next for Greece?


Greek eurozone departure a done deal?


Greece bracing for trouble

Political deadlock is leading to fears that Greece will not have a government in place when it needs to make critical debt payments, which could in turn jeopardize its place in the eurozone.

On Monday, Greeks withdrew up to €800 million from Greek banks, and the threat of a banking panic heightened concern of a default. Fears of contagion spilled over into bond markets in Spain and Italy.

The idea that has investors around the globe worried is the so-called “Grexit” — or Greek exit from the eurozone — a tricky scenario that is now looking like a real possibility.

English bookmakers Ladbrokes stopped taking bets after gamblers lined up to put money on it last week. Other betting companies are giving odds on Greece leaving the euro as low as 1/10, while the odds on Spain leaving are about 6/1.

What effect is uncertainty having on tourism within the eurozone?

Many in the travel industry admit bookings to Greece are lower than in previous years, with other countries benefiting.

Hotel reservations on popular holiday destinations such as Corfu and Crete are down by up to 50% compared to the same period before last month’s indecisive election, according to the Hellenic Hotel Federation.

Sean Tipton of the Association of British Travel Agents blames some inaccurate coverage of concerns about Greece’s financial problems as a factor. “This is having a positive effect on Spanish travel, for example, with bookings higher than normal,” he told CNN.

“Travelers are advised to take spending money in cash, as in the event of Greece leaving the euro there may be questions about whether you could still pay by credit or debit cards.”

Despite tourism contributing about $10,5 billion, or about 16% of Greece’s gross domestic product, officials brushed off concerns. “There was also a financial crisis in Greece last year as well and we had a record year with a 10% increase in the number of visitors,” said Konstantinos Zikos, president of the Greek National Tourism Organization.

“Because of the crisis, early booking are down around Europe at the moment. However, Greece is a beautiful and safe country so we are optimistic that tourism won’t be strongly affected.”

In the longer term, if Greece does leave the euro, it could mean it becomes a much cheaper country to visit, as Britain’s biggest travel company Thomas Cook pointed out. “We believe there are positives and negatives for the travel industry in the event that Greece were to leave the euro,” the firm said.

Should tourists be worried about buying euros for foreign travel?

On the face of it, tourists haven’t had it so good for a long time: The euro is at a three-year low against the British pound and is as weak against the U.S. dollar as it has been since 2010. This should mean the cost of hotels and restaurants is lower than it has been for a few years.

Travel experts say that whatever happens with Greece and the euro this summer, tourists visiting economically troubled European countries, such as Greece, Italy, Spain and Portugal — all major tourist destinations — are unlikely to lose out.

If Greek does leave the euro this could lead to contagion, and other countries joining them, but few analysts believe the whole euro project is likely to collapse in the next year or so. In other words, it’s safe to buy euros, but keep an eye on the exchange rate, which is continuing to strengthen in favor of world currencies.

How can travelers ensure they don’t lose out?

Travel writer Simon Calder said he planned to visit Greece this summer, and was taking two precautions.

“The first was to add an extra €100 to my estimated spending,” Calder wrote on his blog. “Normally I rely on plastic for emergencies, but were Greece to leave the euro, electronic banking could freeze for up to a week and prevent debit and credit card transactions.

“Next, I insisted on €5, €10 and €20 notes. If Greece leaves the euro, the most likely interim currency is the existing euro overprinted with a Greek delta symbol (for “drachma”), or possibly with a corner clipped.

“The value of the Greek euro would fall by perhaps 40 per cent. While traders sort themselves out, and before a market in the Greek currency begins, tourists are likely to pay in euros but be given change in new money. Pay for a €15 round of drinks with a €50 note, and you could get back change in Greek currency worth only €20. That is why low-denomination notes are so useful.”

Do street protests against austerity cuts mean Greece or another country is unsafe?

No. There have been occasional protests in big cities, such as Athens and Thessaloniki, but most say Greece remains safe. Posts on online forums were scathing about what they said was the media blowing the unrest out of proportion, although there are some warnings that strikes could disrupt travel into and around the country.

ABTA’s Sean Tipton said “There’s an element of concern about personal safety with sporadic unrest in Athens, but most places where tourists visit are safe.

“In reality this is one of the best times to visit Greece, as prices should come down, thanks to supply and demand.”

UK travel firm Thomas Cook said it was “closely monitoring the evolving situation in Athens. Most of our holidaymakers are on the country’s islands where you’d never know anything was going on.”






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Should I cancel my vacation?


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Tourists enjoy crystal-blue waters at Balos beach in northwestern Crete.Tourists enjoy crystal-blue waters at Balos beach in northwestern Crete.

Despite protests elsewhere in Athens, tourists visit the Parthenon on the Acropolis in February 2012.Despite protests elsewhere in Athens, tourists visit the Parthenon on the Acropolis in February 2012.

A man walks along the waterfront in Aigio, Greece, on March 31, 2010 A man walks along the waterfront in Aigio, Greece, on March 31, 2010

The statue of King Leonidas of ancient Sparta stands over the battlefield of Thermopylae, some 170 kilometres north of Athens.The statue of King Leonidas of ancient Sparta stands over the battlefield of Thermopylae, some 170 kilometres north of Athens.

Ancient Olympia in Greece, pictured in 2007 during a spate of brush fires, is the site of the original Olympic Games.Ancient Olympia in Greece, pictured in 2007 during a spate of brush fires, is the site of the original Olympic Games.

Tourists enjoy clear blue sky amid palm trees on an unusually quiet Costa del Sol Carihuela beach in Torremolinos, Spain in August 2009.Tourists enjoy clear blue sky amid palm trees on an unusually quiet Costa del Sol Carihuela beach in Torremolinos, Spain in August 2009.

Tourists visit Sao Jorge Castle in Lisbon, Portugal in July 2008.Tourists visit Sao Jorge Castle in Lisbon, Portugal in July 2008.


1


2


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5


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7

(CNN) — In the last decade of the 20th century, the Turkish lira fell in value 1,000 times against the U.S. dollar, meaning that tourists returning to that country after several years found that any old money they still possessed since their last visit had become almost worthless.

Now as fears grow about whether Greece will stay in the euro, and the possible domino effect this could cause, many prospective holidaymakers appear to be having second thoughts about visiting that country and other economically troubled members of the 17-nation eurozone, such as Spain or Portugal.

And while tourists may be bulking up their cash reserves in the case of a euro exit, others may be concerned about safety if violent street protests resume against austerity cuts.

What is the financial situation now?


Greeks withdraw cash from banks


What’s next for Greece?


Greek eurozone departure a done deal?


Greece bracing for trouble

Political deadlock is leading to fears that Greece will not have a government in place when it needs to make critical debt payments, which could in turn jeopardize its place in the eurozone.

On Monday, Greeks withdrew up to €800 million from Greek banks, and the threat of a banking panic heightened concern of a default. Fears of contagion spilled over into bond markets in Spain and Italy.

The idea that has investors around the globe worried is the so-called “Grexit” — or Greek exit from the eurozone — a tricky scenario that is now looking like a real possibility.

English bookmakers Ladbrokes stopped taking bets after gamblers lined up to put money on it last week. Other betting companies are giving odds on Greece leaving the euro as low as 1/10, while the odds on Spain leaving are about 6/1.

What effect is uncertainty having on tourism within the eurozone?

Many in the travel industry admit bookings to Greece are lower than in previous years, with other countries benefiting.

Hotel reservations on popular holiday destinations such as Corfu and Crete are down by up to 50% compared to the same period before last month’s indecisive election, according to the Hellenic Hotel Federation.

Sean Tipton of the Association of British Travel Agents blames some inaccurate coverage of concerns about Greece’s financial problems as a factor. “This is having a positive effect on Spanish travel, for example, with bookings higher than normal,” he told CNN.

“Travelers are advised to take spending money in cash, as in the event of Greece leaving the euro there may be questions about whether you could still pay by credit or debit cards.”

Despite tourism contributing about $10,5 billion, or about 16% of Greece’s gross domestic product, officials brushed off concerns. “There was also a financial crisis in Greece last year as well and we had a record year with a 10% increase in the number of visitors,” said Konstantinos Zikos, president of the Greek National Tourism Organization.

“Because of the crisis, early booking are down around Europe at the moment. However, Greece is a beautiful and safe country so we are optimistic that tourism won’t be strongly affected.”

In the longer term, if Greece does leave the euro, it could mean it becomes a much cheaper country to visit, as Britain’s biggest travel company Thomas Cook pointed out. “We believe there are positives and negatives for the travel industry in the event that Greece were to leave the euro,” the firm said.

Should tourists be worried about buying euros for foreign travel?

On the face of it, tourists haven’t had it so good for a long time: The euro is at a three-year low against the British pound and is as weak against the U.S. dollar as it has been since 2010. This should mean the cost of hotels and restaurants is lower than it has been for a few years.

Travel experts say that whatever happens with Greece and the euro this summer, tourists visiting economically troubled European countries, such as Greece, Italy, Spain and Portugal — all major tourist destinations — are unlikely to lose out.

If Greek does leave the euro this could lead to contagion, and other countries joining them, but few analysts believe the whole euro project is likely to collapse in the next year or so. In other words, it’s safe to buy euros, but keep an eye on the exchange rate, which is continuing to strengthen in favor of world currencies.

How can travelers ensure they don’t lose out?

Travel writer Simon Calder said he planned to visit Greece this summer, and was taking two precautions.

“The first was to add an extra €100 to my estimated spending,” Calder wrote on his blog. “Normally I rely on plastic for emergencies, but were Greece to leave the euro, electronic banking could freeze for up to a week and prevent debit and credit card transactions.

“Next, I insisted on €5, €10 and €20 notes. If Greece leaves the euro, the most likely interim currency is the existing euro overprinted with a Greek delta symbol (for “drachma”), or possibly with a corner clipped.

“The value of the Greek euro would fall by perhaps 40 per cent. While traders sort themselves out, and before a market in the Greek currency begins, tourists are likely to pay in euros but be given change in new money. Pay for a €15 round of drinks with a €50 note, and you could get back change in Greek currency worth only €20. That is why low-denomination notes are so useful.”

Do street protests against austerity cuts mean Greece or another country is unsafe?

No. There have been occasional protests in big cities, such as Athens and Thessaloniki, but most say Greece remains safe. Posts on online forums were scathing about what they said was the media blowing the unrest out of proportion, although there are some warnings that strikes could disrupt travel into and around the country.

ABTA’s Sean Tipton said “There’s an element of concern about personal safety with sporadic unrest in Athens, but most places where tourists visit are safe.

“In reality this is one of the best times to visit Greece, as prices should come down, thanks to supply and demand.”

UK travel firm Thomas Cook said it was “closely monitoring the evolving situation in Athens. Most of our holidaymakers are on the country’s islands where you’d never know anything was going on.”






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