Georges Ghonos, the managing director of McCain Hellas, the Greek division of Canada's McCain Foods, is a pickpocket's dream.
His black, leather wallet is as thick as a hockey puck. That's because it is stuffed with €1,200 ($1,670) in cash. "The banks are shut and I need to give some cash to my wife so she can get to the island," he says.
The Greek banks have been closed since Monday, the day after the Greek government announced they would not reopen to protect them from a potentially fatal run on deposits. At the same time, strict limits were imposed on ATM withdrawals – €60 a day – and international money transfers.
As hoarding removed cash from circulation, businesses big and small were losing customers and sales, some of them at an alarming rate. For them, the nightmare scenario is a No vote in Sunday's national referendum, with No signalling a rejection of the last bailout terms offered by Greece's creditors. Rejection would probably trigger a currency and payments crisis, forcing the insolvent government – it defaulted on a €1.6-billion loan payment to the International Monetary Fund this week – to issue a parallel currency or reprint the old drachma to prevent a quick economic death.
Mr. Ghonos is 66 – old enough to have lived through more than a few genuine Greek crises. There included the lengthy post-Second World War battles between communist and anti-communist forces, a military coup d'état, a countercoup, brutally suppressed student uprisings, the Cyprus invasion and, recently, the debt crisis that resulted in the twin bailouts of Greece.
Throughout all these horrors, the economy more or less functioned, Mr. Ghonos says. "This is by far the deepest crisis, economically, that I've seen," he says over a coffee at a central Athens hotel that is suddenly losing bookings, as tourists decide they'd happily skip a front-row seat to potential economic collapse. "I've never seen the banks closed before and no one knows whether we will still have the euro."
No Greek business can prevent the euro from disappearing, but they are hoping the referendum will go in favour of accepting the creditors' loans-for-austerity proposal – a Yes vote. In the meantime, they are implementing emergency plans to survive in a cash economy where cash is becoming scarcer by the hour.
McCain Hellas is screening its 100 or so distributors to make sure they are financially stable. The distributors are typically paid in cash from the mom-and-pop restaurants, fast-food chains and supermarkets that buy McCain's frozen French fries. If the distributors do not get their cash, they in turn cannot pay McCain.
He is worried that some of them will cease being able to function or even go bankrupt if the banks do not reopen soon. "If cash disappears, our sales will drop," Mr. Ghonos says. "We need to protect our financial exposure."
Mr. Ghonos set up McCain Hellas in 1992, when McCain, the world's largest producer of frozen French fries – it owns one-third of the global market – wanted to expand in Southern Europe. At the time, he was the Greek ice cream sales director for consumer-products giant Unilever. "I started McCain Hellas in my home, in the kitchen," he says.
Growth was fast in the fragmented local frozen-foods market, where quality was often low. McCain charged higher prices for higher-quality fries. In the first year, the company sold 4,000 tonnes of fries. It is now selling 30,000 tonnes a year, worth about €30-million. The fries mostly come by ship from potato-processing plants in France. McCain Hellas has no local production.
McCain has not been aloof to the Greek crisis, which has sent youth unemployment to well above 50 per cent and spread poverty and misery throughout the country. With the lowly potato in mind, it launched a corporate social responsibility program to help hard-pressed farmers in the far north of Greece, near the Macedonia border. "The company thought it should support Greece through these terrible times," Mr. Ghonos says. "This country needs help."
McCain Hellas worked with the agriculture department of Aristotle University, CSR Hellas and the Stavros Niarchos Foundation to design and fund the project. It is giving 25 farmers high-quality potato seeds, infrastructure, pesticides and training so they can grow about 1,000 tonnes of potatoes a year and get them to market. The goal is to give them a source of income in a depressed economy. The project is one of the reasons why the Canadian embassy in Greece presented him with a Friends of Canada award this week.
The next project is to prepare for the worst as the Greek economy braces for a referendum of which the result could force it out of the euro zone.
Does he believe that Greece's exit from the euro zone is coming? "I still believe that this will not happen," he says. "I just hope this is the peak of the crisis."