29-11-2021 10:42 PM Jerusalem Timing

Banks Reopen, Taxes Hiked as Greece Seeks to Reboot Economy

Banks Reopen, Taxes Hiked as Greece Seeks to Reboot Economy

Greek banks reopened Monday after a three-week shutdown imposed to stop a run on ATMs from crashing the financial system

Greek banks reopened Monday after a three-week shutdown imposed to stop a run on ATMs from crashing the financial system, but citizens woke up to widespread price hikes as part of a cash-for-reform deal with the country's creditors.

The bank shutdown since June 29 is estimated to have cost Greece's crisis-hit economy 3.0 billion euros ($3.3 billion) in market shortages and export disruption.

Capital controls including a block on key transfers to foreign banks and a ban on the opening of new accounts remain in force, although a daily cash withdrawal limit of 60 euros ($65) has been relaxed.

Louka Katseli, the head of Greece's bank association, said Greeks would now be able to withdraw a maximum of 300 euros at once until Friday, when a new weekly limit of 420 euros comes in force.

The government is meanwhile expected to make a 4.2 billion euro payment Monday to the European Central Bank (ECB), made possible by a short-term "bridge" loan of 7.16 billion euros granted by the European Union on Friday.

The loan will also allow the debt-crippled Greek government to make payments to the International Monetary Fund (IMF) outstanding since June.

Greece's radical left government last week agreed to tough reforms -- including tax hikes, an overhaul of the ailing pension system and privatisations it had previously opposed -- in exchange for a three-year bailout of up to 86 billion euros that it is hoped will stop it crashing out of the eurozone.