Monday, 6 July 2015

Greek debt crisis solved: Greece to issue "Sun and sea vouchers"

In round numbers, seeing as Greece makes up a lot of statistics anyway:

* Greece owes the Troika €200 billion
* 20 million tourists per year.
* Average spend on air fares and hotels €1,000 each = €20 billion per year.
* Half of this is actual incremental costs.
* The other half of what tourists pay for is stuff which Greece gets for 'free' or which are already in existence/paid for i.e. airport infrastructure, hotel buildings, landscapes and historical sites, beaches, blue sea and sunshine.
* Additional cash spend by tourists €500 per holiday.

So what Greece could do is issue the Troika 400 million "Sun and sea vouchers" entitling the bearer to €500 off the cost of airfares and hotel stays, pre-dated 20 million a year for each of the next 20 years. So Greece will be redeeming its national debt by giving away value which they themselves get for free.

We can assume that balance of what tourists actually spend more than covers the incremental costs (the airport and hotel staff, the food and drink they consume and other tourist tat like fridge magnets), so that's a break even.

All the creditors - the IMF, banks, the ECB and so on - will be given the appropriate number of vouchers and they can sell these to travel agents for something approaching face value, who then pass on the discount to people who want to go to Greece on holiday, so over the next 20 years the creditors will get their money back (albeit indirectly).

A sunshine backed currency. What can possibly go wrong?


View from the Solent said...

"20 million tourists per year.

Average spend on air fares and hotels €1,000 each = €20 million."

e20 million? Some zeros missing, ochi?

Mark Wadsworth said...

Vfts oops I have amended.

Random said...

Can they be used to pay taxes? ;)

Mark Wadsworth said...

R, clearly, to force the tourism industry to accept the vouchers, the government has to collect them back in tax, I would have thought that is obvious, see next post for full explanation.