The long road to recovery, despite financial rebound

A worker pulls a loaded cart inside a warehouse of Vanos marine supply company.

By Karolina Tagaris

Nikos Mavrikos has fired half of his employees since 2010 as the Greek economy imploded, leaving his ship supply business on the verge of collapse. February marked a turning point, however: Mavrikos made a hire, his first in four years.

"People are slowly starting to trust Greece again,» says Mavrikos, who hopes to take on even more employees soon at his family-owned business.

Greece is experiencing a remarkable financial recovery. Just two years ago, the country was expected to default and exit the euro, possibly setting off a messy unraveling of the entire currency bloc.

Today, after a tough regime of layoffs, wage cuts and reductions in government spending, factories are beginning to hum again, Greeks are starting to buy cars and other products again and the country is being courted in financial markets. The government is looking to the end of a tough international emergency aid program at the end of the year.

On Tuesday, Greece sold six-month Treasury bills at the cheapest borrowing cost since 2010. Most of the buyers were foreign. It is planning a return to the international bond markets for the first time in four years on Thursday, with the sale of a five-year euro bond.

"The image of Greece abroad has changed dramatically. Now the sentiment is changing in Greece as well,» Greek Prime Minister Antonis Samaras told Reuters in an interview last week. «We are now at the edge where unemployment has stopped rising, no more people are being fired, and there are some very positive indications of new hires."

For all the green shoots, it is too early to talk about long-term economic...