[LINK] "German Tourists Cool on Greece as ATMs at Risk of Crunch"

[rfmcdonald]

Bloomberg's Marcus Bensasson notes one consequence of Greece's ill-planned leap under Syriza: Declining tourist numbers, particularly from Germany.

Greece’s standoff with creditors is threatening the surge in tourism that helped drag the country out of a six-year slump in 2014.

A strong start to the year has tailed off in recent months with potential visitors deterred by the risk of being caught up in a cash crunch. Bookings from Germany were 0.7 percent higher than last year at the end of the first quarter after jumping 12 percent in January, prompting the Greek tourist lobby to consider ditching its forecast for a record number of visitors this year.

“We’re seeing a slowdown in some markets, particularly in Germany,” Andreas Andreadis, president of the Association of Greek Tourism Enterprises, or SETE, said in a telephone interview last week. “We’ve been losing ground in the last few months, we’re losing momentum, as long as the big picture remains unclear.”

Greece’s economy fell back into recession in the first quarter as Prime Minister Alexis Tsipras’s attempt to win better terms from the country’s creditors squeezed financing and deterred investment. The contraction raises the pressure on Tsipras to reach a deal, while also forcing deeper budget cuts to meet the conditions for aid.

The crisis has left Greece’s banking system hanging on the thread of emergency liquidity support from the European Central Bank, and raised the prospect capital controls may be imposed. Such an outcome could limit the amount of cash that visitors could withdraw from ATM machines.