Greece in crisis: Is it safe to go on holiday to Greece?

Greece is dangerously close to having to leave the eurozone after pleas for an extension of bailout plans over a 1.6 billion euro (£1.1 billion) debt repayment to the International Monetary Fund were rejected.

Earlier today, Chancellor George Osborne issued a warning to anyone heading on holiday to Greece, insisting that they should keep an eye on the advice issued by gov.uk before setting off.

But what is really going on? And how does the financial crisis in Greece affect Britons?

FIRST THINGS FIRST, WHO DOES GREECE OWE MONEY TO?

Greece owes a total combined debt of 323 billion euros to the European Stability Fund, the Greek Loan Facility, the IMF, the European Central Bank, the Greek banks, and a few other smaller bonds.

WHAT IS HAPPENING AT THE MOMENT?

In a bid to prevent their economy from crashing, Greece's government has closed the country's banks and imposed capital controls on moving money until after a referendum next Sunday (5th July).

The cash machines are still supposedly open but Greeks have a daily limit on withdrawals of just €60 (£42).

Athens stock market is also closed.

WHAT WILL HAPPEN AT THE REFERENDUM?

The referendum will see Greece decide whether or not to accept a new bailout deal.

If they vote ‘yes’, they will accept strict austerity terms laid out by the EU, to ensure that the country’s debts can be repaid.

However many Greeks are being urged by their government to vote ‘no’ in the referendum, which will most likely see them leave the EU altogether (dubbed he ‘Grexit’).

Should this happen, the country will be forced to set up its own currency.

Any new currency would be expected to rapidly devalue against the euro because of the country’s weak economy, leaving those with money still in Greece dramatically poorer.

HOW HAS THIS AFFECTED THE EURO?

The euro has weakened against the pound, with one euro now worth £0.7086, while the pound buys €1.4127.

WHAT WILL HAPPEN TO GREEK EUROS IF THE COUNTRY CRASHES OUT?

If the country does leave the euro, it will not happen overnight.

However, if you are worried, check the 11 digit number on the euro bank notes you are given when changing your money.

If they begin with the letter ‘Y’, it means that they were issued by Greece - so you may wish to avoid these.

WILL I STILL BE ABLE TO GET MONEY OUT WHILE I’M ON HOLIDAY IN GREECE?

The Greek government have issued a statement saying that capital controls introduced by the Greek Government do not apply to foreigners wishing to withdraw money from an ATM or use their credit cards.

However the Foreign and Commonwealth Office (FCO) are still advising British travellers to take lots of extra cash.

George Osborne advised: “Visitors to Greece should be aware of the possibility that banking services – including credit card processing and servicing of ATMs – throughout Greece could potentially become limited at short notice.

“Make sure you have enough Euros in cash to cover emergencies, unforeseen circumstances and any unexpected delays.”

He also reminded tourists that Greek businesses can choose whether or not to accept credit or debit cards at their own discretion.

IS IT SAFE TO CARRY LARGE AMOUNTS OF CASH?

If you plan on taking large amounts of cash with you into Greece, please make sure that your travel insurance covers it.

Most policies will cover you for cash, but typically it is between £200 and £300, so be sure to read it carefully.

And remember that terms and conditions usually require you to keep your money on your person, or in a safety deposit box; you will most likely not be covered if you leave the money in an unattended bag or case, whether it is left in the hold of a plane, in the trunk of a car, or in the wardrobe of a locked hotel room.

WILL THERE BE VIOLENCE?

There are, due to the current economic situation, regular protests and demonstrations.

These usually take place in Athens, particularly in Syntagma Square.

It is best to watch the local news whilst you are in Greece so that you can avoid these demonstrations wherever possible, as police are known to use tear gas in such situations.

The FCO explain: “You should follow local media and avoid large crowds and demonstrations. Road closures are common in Athens and are not always announced in advance.

“Demonstrations can be called at short notice, but there are certain dates on which demonstrations traditionally occur: 1 May, 17 November, and 6 December.”

WHAT HAPPENS IF GREECE LEAVES THE EUROZONE WHILE I’M THERE?

If Greece announces that they are to leave the Eurozone while you’re visiting don’t panic, it will not happen overnight.

In fact, it would take about 18 months for their currency to completely revert back to the Greek drachma.

SHOULD I CANCEL MY HOLIDAY?

At the moment, no - not only because there is no immediate danger posed, but also because the Greek people need tourism more than ever.

Deputy Minister for Tourism, Mrs Elena Kountoura, said: “Greece continues to offer the highest quality of tourism services to its visitors, who have ranked Greece as one of the best holiday destinations worldwide.

“Greece still is and will always be a favourite destination for holidaymakers.

“Visitors currently in Greece as well as people planning to visit Greece will not be affected by the latest developments and they can continue to enjoy their holiday in Greece without any problems whatsoever.”

A Thomas Cook spokesperson added: “Greece continues to be an important destination for us and great value for our holidaymakers.

“We’re working with our suppliers and closely monitoring the situation.

“To date we have seen no drop off in bookings so far as a consequence of a potential “Grexit”.

“We expect an exit from the euro would have no impact on the holidays costumers have already booked with us because we have existing contracts with hotels and airlines.”

WILL IT COST MONEY TO CANCEL MY HOLIDAY?

Yes, your tour operator or airline will most likely charge you for any changes made to your holiday plans.

Depending on their terms and conditions, this could cost you up to 100% of the money paid.

An operator is only legally obliged to offer a refund if the Foreign Office (FO) issues official advice against travel to that destination.