Croatians with Swiss franc loans protest 'debt slavery'

GMT 21:10 2015 Saturday ,25 April

Arab Today, arab today Croatians with Swiss franc loans protest 'debt slavery'

Holders of Swiss franc mortgages and their supporters take part in a march in Zagreb
Zagreb - AFP

Thousands of Croatians with loans denominated in Swiss francs took to the streets of Zagreb Sunday to protest the increased debt burden caused by a surge in the Swiss currency.

The police estimated that up to 10,000 people took part in the protest by demonstrators accusing the Croatian government and central bank of failing to protect borrowers.

Franak, the association of borrowers behind the protest, also called for the resignation of Central Bank governor Boris Vujcic.

Swiss franc loans became popular in several central European countries in the 2000s, when interest rates on the currency were low.

Around 60,000 Croatians, who still have such loans, have seen their borrowing costs soar since Switzerland in January lifted a three-year cap on its currency, causing it to soar.

The protestors marched on Zagreb central square, where they split into two groups -- one heading to government buildings and the other to the central bank offices.

"Thieves, thieves!", demonstrators outside the central bank chanted.

Many protesters carried banners bearing slogans such as "Against loan sharks! We want our dignity back!" and "Stop debt slavery!"

Switzerland's unpegging of the Swiss franc from the euro wreaked havoc on currency markets, bankrupting several foreign exchange traders.

Croatia reacted by fixing the Swiss franc rate for payment of loans at 6.39 Croatian kunas (0.84 euros, $0.91) for a year, below its pre-surge level.

Croatian banks are to bear the cost of the operation, estimated by the central bank at some 52 million euros.

Talks between the borrowers, banks and the finance ministry on finding a lasting solution ground to a halt in late March.

The borrowers are demanding the conversion of their loans into kuna and a return of the interest rates to the level at which they stood when the loans were contracted.

Croatia joined the European Union in 2013, but the former Yugoslav republic of 4.2 million, which has been mired in recession for the past six years, has yet to adopt the euro.

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