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Olga Vartzioti lives in the northern suburbs of Athens and has become so disillusioned with the healthcare system, she plans to move abroad. Yannis Kontos for The National
Olga Vartzioti lives in the northern suburbs of Athens and has become so disillusioned with the healthcare system, she plans to move abroad. Yannis Kontos for The National
Italy's stock exchange in the financial district of Milan. Giuseppe Aresu for The National
Italy's stock exchange in the financial district of Milan. Giuseppe Aresu for The National
A line of closed stores in Milan. Giuseppe Aresu for The National
A line of closed stores in Milan. Giuseppe Aresu for The National
Women browse discounted clothes at the Porta Portese street market in Rome. Victor Sokolowicz for The National
Women browse discounted clothes at the Porta Portese street market in Rome. Victor Sokolowicz for The National
Italy's central bank. Victor Sokolowicz for The National
Italy's central bank. Victor Sokolowicz for The National
"What's's happening in Europe affects the whole world. The UAE will be affected because the crisis affects the customer," said Mohammed Al Fahim, the chief executive of Paris Gallery, at the World Retail Congress in Berlin. Jochen Eckel for The National
'What's's happening in Europe affects the whole world. The UAE will be affected  because the crisis affects the customer,' said Mohammed Al Fahim, the chief executive of Paris Gallery, at the World Retail Congress in Berlin. Jochen Eckel for The National
Greeks protest the government's new austerity measures and taxes in Athens. Yannis Kontos for The National
Greeks protest the government's new austerity measures and taxes in Athens. Yannis Kontos for The National

Italy and Greece united by more than currency

Euro Zone:
Rory Jones wraps up his exclusive from the heart of Europe, and examines if the diverse cultures unite behind a common financial policy.

On the final day of his journey through the euro zone crisis, Rory Jones reflects on what he found: optimism in some parts, but also deep despondency over austerity measures and public resentment at officialdom.

Travelling from the affluent, tree-lined boulevards of Berlin to the graffiti-scarred alleys of central Athens, the economic contrast between these two cities bound by a single currency is stark.

Between Germany and Greece lies Italy where, beneath the glitz of Milan and the beautiful heritage of ancient Rome, an undercurrent of resentment and anger towards authority bubbles, particularly among the younger generation.

Moving south through Europe, the increase in temperature seemingly reflects the economic and social mercury rising, with Greece now at melting point.

Austerity measures inflicted upon Athens by the IMF are affecting each and every person, from students to taxi drivers, public servants to professionals.

Olga Vartzioti, 36, a senior consultant at a hospital, lives in the northern suburbs of Athens and has become so disillusioned with the healthcare system, she plans to move abroad.

Having spent five years studying to become a doctor and then working for 10 years to become a consultant of pulmonology, her salary was cut last month from 1,600 (Dh7,870) to 1,400.

"Next month they might decrease it again, so I wait each month to see if they are going to decrease my salary," she says dejectedly. "It's a very good profession that is paid well in other countries around the world, but not here."

In general, Athenians do not believe they lived beyond their means in the past decade and instead blame the bureaucracy of the system and widespread corruption among politicians and the public sector for the country's huge level of debt.

"The people who are in authority steal, they are corrupt. Not all of them but most of them," says Marietta Vetta, a 33-year-old dancer, on a protest march in Athens.

"Everyone now wants something different,"says Dr Vartzioti. "But you cannot think properly as a doctor when you are thinking about how to move away or make more money."

The blame sentiment is echoed across the Mediterranean in the cities of Italy. So much so that without the difference in languages, a traveller could not differentiate between Greek and Italian outrage. The public in both countries now despise the "you scratch my back, I'll scratch yours" mentality that has been prevalent in each for years.

"None of my friends are motivated because of corruption, it just continues on in this way," says Stella Colosimo, a 30-year-old lawyer from Naples.

In Greece, unemployment was 16 per cent at the last count and is forecast to reach one quarter of the total workforce next year. Germany, meanwhile, is still growing - albeit at a slower rate than before.

Nancy Mathioudaki, a consumer practice leader at Stanton Chase International recruitment company in Athens, believes the austerity measures are too much, too soon.

"The rate of change has been unbelievable and I do not think society has been able to absorb all the changes," she says. "People are pessimistic because the change has been so violent since the IMF stepped in."

Protesters camped out in Syntagma Square, home to the Greek Parliament, claim the EU is using the people of Greece as test subjects for the other countries on the continent that are also at near-bankruptcy.

"We believe we are the guinea pigs for the rest of Europe," says Thanasi Kourkoulas, a teacher from Athens. "This debt crisis is not to do with Greece only."

In Rome, small businesses and young people would agree with Mr Kourkoulas; they see themselves next in the firing line. Italy is also bringing in austerity measures and Italians will have to survive in an economy forecast to grow little in the next two years.

Concetta Qudciudrella, the owner of a guesthouse in Rome, says a recently introduced tax that requires guests to pay 2 per person, per night is already hurting the smaller hotels.

For a hotel that charges little in the first place, the tax can add a significant amount to the rate for a family of five staying for a week.

"The city tax is not good for tourism," she says. "This is a small hotel, not a big hotel that can add the tax into an already expensive price."

Throughout Europe, financial experts and ordinary people alike see a default by Greece in the coming months as a real possibility, alongside other countries such as Italy, Portugal and Spain, despite Germany's vote last week to beef-up the euro-zone's bailout fund.

"An Italian default is not an impossibility, the risk is there and we have to keep this risk very present in our minds," warns Chiara Menenti, a fixed income strategist at Italy's biggest bank, Intesa Sanpaolo.

In Berlin, the euro zone's problems are still a talking point at dinner tables and in bars, but it does not seem to involve the resentment many expected Germans to express about having to repeatedly bail out their distant neighbours.

"Greece buys German cars and German things, so there is partnership," says Karafillidis Dimitrios, a Greek-German living in Berlin. "It's not only a two-way relationship, it's the whole of Europe, they give and they take."

But travelling round the continent, it is hard to avoid the feeling that despite the single currency, the ease of crossing borders and the freedom of trade, the countries of Europe differ greatly, with thousands of years of individual history and identity.

As one Greek puts it: "We like the sunshine, we have a Mediterranean lifestyle that is not all work, so it is hard to be in a financial union with places like Germany."

It is difficult to see how a financial union such as the euro can work long term when there is not a political union to accompany it. Even if the continent developed such a union, the people of each country have different priorities. Only the Germans seem to view the euro as a positive for their economy and Europe. The Italians and Greeks believe it has ultimately reduced their standards of living. And that is a fundamental problem.

rjones@thenational.ae

         

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