Greece loses Coca-Cola

Greece's jobless rate exceeded 25% and its biggest company said yesterday that it would quit the country in a fresh blow to an economy that German experts warned cannot be "saved" without writing off more debt.

The announcement by drinks bottler Coca-Cola Hellenic that it is switching its primary listing from Athens to London, and moving its corporate base to stable, low-tax Switzerland, is a bitter blow to the debt-crippled nation.

The firm, which bottles Coke and other drinks in 28 countries, from Russia to Nigeria, is Greece's biggest by market value and is 23% owned by The Coca-Cola Company of the US. It said its Greek plants would be unaffected.

Coca-Cola Hellenic had complained about steep taxes. Its decision to relocate was bad news for a nation struggling to compete inside the eurozone. CEO Dimitris Lois said the decision to switch the company's primary listing to London and its corporate base to Switzerland made "clear business sense".

Coca-Cola Hellenic's announcement coincided with data that showed Greek unemployment climbing for a 35th consecutive month in July to 25.1% from a revised 24.8% in June. The jobless rate has more than tripled in five years of recession.

About 54% of Greeks aged 15 to 24 are out of work, fuelling violent protests against the tax increases, spending cuts and public sector job losses demanded by the EU and the International Monetary Fund in exchange for more than à200-billion in loans since 2010.

IMF chief Christine Lagarde, speaking in Tokyo, backed calls to give Greece two more years in which to cut its debt mountain to 120% of GDP from 165% this year.

The IMF is pressing national lenders such as eurozone paymaster Germany to take a "haircut" on Greek debt similar to that swallowed by private bondholders this year.

With elections in 2013, Berlin is resisting, but Germany's leading economic institutes warned yesterday that, without more debt restructuring, the Greek economy would not make it.

"We don't think Greece can be saved," Joachim Scheide, head of forecasting at the IfW institute, in Kiel, said.

"We need a restructuring of Greek debt; that would help Greece best," he said.

German Chancellor Angela Merkel, who was greeted with angry protests on Tuesday on her first visit to Greece since the debt crisis erupted, opposes further restructuring, at least until after Germans vote in September.

The Greek government is locked in talks with its "troika" of lenders on the imposition of more austerity measures to secure a next tranche of loans worth à31.5-billion. Without further aid, Athens says it will run out of money by the end of next month.

Data released by the finance ministry showed that Greece had narrowed its central government budget deficit by 37% in the first nine months of the year.