Hotels face drachma demand
Archimedes: November 2011
Greek holiday hotels face drachma demand.
Fears of a Greek withdrawal from the Euro has prompted holiday giant TUI to demand full payment in drachmas from Greek holiday hotel owners.
TUI holiday contracts have had a paragraph inserted to say the tour firm reserves the right to take payment in any new Greek currency should Greece leave the Euro-zone.
the Association of Greek Tourism Enterprises (SETE) confirmed that a number of hotel owners in Greece had received the letter from TUI asking them to sign new contracts.
TUI Travel has over 200 brands including market-leading mainstream holiday companiess. They include holiday brand leaders like Thomson and First Choice as well as specialist brands such as Simply Travel and Sovereign Holidays.
The new contract says ". . . where the Supplier carries on its business and the amounts set out in the Contract Details are denominated in Euros then, from the date of the Euro being replaced by the new national currency . . . any outstanding or unamortized prepayments may, at the instruction of TUI, be immediately repaid by the Supplier to TUI in the new national currency . . ."
A TUI spokesman confirmed the new contract. He said: "We have to protect ourselves against these kinds of currency risks. Right now there is more than just a theoretical possibility that Greece will leave the Euro-zone."
Experts warn that should Greece abandon the Euro and go back to the drachma, the new Greek currency could be worth 60% less in real terms.
SETE leaders have warned its members no to sign the new contract. A spokesman said: "We have informed to the Greek tourism ministry for advice. TUI cannot pressure any hoteliers into signing this crazy contract".
Fears of a withdrawal from the Euro have lifted as political leaders form a new coalition government to push through even more austerity measures.
But travel firms are still worried that contracts signed now for Greek island holidays in 2012 may cost them dear if Greece leaves the Euro and the new currency collapses.