Greek town withers as boom turns to bust

(Reuters) - Decades ago, Antonis Seitanidis' family fled Asia Minor to settle in the northern Greek town of Komotini in search of a better life.

Today, he is urging his grandchildren to abandon the town - a place that once gave him hope but is now ravaged by factory closures, a lack of jobs and rising anger.

"This is the worst crisis I can remember in at least 50 years," the 84-year-old said. "I have five grandchildren and three of them are unemployed. I tell them to leave the country - to go to Germany or Australia. People will help them there. I don't understand, what are they waiting for? The end?"

Things in Komotini appeared to hit rock bottom last week, when an unemployed man burst into the factory that laid him off and shot his former boss and another worker, injuring them both.

Stunned disbelief soon turned into sympathy in a town where one in four residents is unemployed.

"After the initial shock, many people sympathise with this man," said George Petridis, the local mayor. "I'm afraid we can't sink any lower than where we are right now."

With a sizeable Muslim minority and economic problems that began several years before the debt crisis emerged in the rest of Greece, Komotini has a complex history that sets it apart from other stricken towns across the country.

But the town's decay also epitomises the messy fallout from a rapid boom and bust seen across much of Greece over the past decade, offering a sobering picture of what the rest of the country could look like after a few more years without growth.

Greece, which is being forced to cut spending and wages by its European partners, including Germany, as a condition for loans to prevent bankruptcy, is in its fifth year of recession. The human cost of the crisis is all too easy to see in towns like Komotini.

"What exacerbates the disappointment and despair with us, is this sentiment of national humiliation," said Petridis. "Whether right or wrong, people feel that Greece has become a protectorate of Germany."

At the town's outskirts, a once-thriving industrial zone that drew thousands of workers to the area now looks like a wasteland. At its peak, about 100 factories whirred away near open fields, churning out sweets, Adidas sneakers, iron and bottled beer.

Today, only about seven or eight factories are thriving, while another 10 are struggling to survive the crisis, says Petridis. Rusting pipes, broken windows and empty buildings surrounded by overgrown weeds are all that is left of the rest.

"It's like an industrial graveyard," said Petridis. "For those of us who remember the area at its height, it is very sad."

Unemployment in the town is three percentage points above the national average, at 24 percent.

SMILES ON THEIR FACES

Near the Turkish border, Komotini loooks like many other towns in mainland Greece - wide roads lined with apartment blocks for its 60,000 residents, souvlaki shops and a sprawling central square with cafes.

Its historic centre with an old mosque and shops with Turkish lettering reveals an intriguing past and attests to the mix of Greeks - including many from the former Soviet Union and Asia Minor - and Muslims of Turkish or Bulgarian origin who live here.

Wedged between the sea, Bulgaria to the north and Turkey to the east, the region has had its share of struggles, long before the debt crisis arrived at its doorstep.

During its occupation by Nazi forces during World War Two, hundreds of Jews were sent to concentration camps. After the war, the town - mainly tied to farming in the surrounding countryside - struggled for years.

A new university in the 1970s brought in students, but the good times really began in the 1980s, when an industrial zone was set up and European Union funds began flowing in.

Greek companies flocked to the area, setting up factories to take advantage of subsidies. By the 1990s, Komotini was flourishing.

Nearly 18,000 workers from all over Greece toiled in its factories. A consumer boom took off, a large shopping mall sprang up and German cars became popular as money flowed in.

"Each year I returned, I saw the change. It was very rapid and visible - the buildings, the smiles on the faces, the new cars," said Petridis, who had studied elsewhere.

The industrial boom ended as abruptly as it began - when subsidies and funds dried up in the early 2000s.

By the time Greece sank into a debilitating debt crisis in 2009, Komotini's heady boom days were long gone. Since then, things have only got worse, say residents.

"In the last two years there's been a sharp decline. Three years ago there were twice as many factories and now it is not just the factories anymore," said Petridis.

"The crisis is hitting everyone."

ECONOMIC WAR

Since 2009, the town's municipal budget has been cut about 40 percent, says Petridis. But the town has had to boost spending at the same time, as it tries to provide part-time jobs for unemployed youth and meals for the homeless.

George Nikolaidis, head of the local business union who owns a fertilizer factory, says he dealt with as many as 10 banks a few years ago but now has to make do with just three as bank lending to companies like his dries up during the crisis.

"Once we had Germany occupying us, but today what we have is an economic war," he said.

Theodora Stroubi, 22, a political science student, has been searching for a part-time job for months without luck. She says she knows her future is not in Komotini anymore.

"I can't just sit here waiting for something to happen," she said. "If I can't get by anymore, I'm thinking of going abroad."

At 1 a.m. on Saturday morning, flower shop owner Ibrahim Hussein revs up his motorbike. A slump in business has forced him to take up a second job as a late-night delivery man.

"People used to buy flowers for birthdays or patron saint days. Now they just call to offer their wishes," the 44-year-old said.

"When people buy a simple wreath for a funeral they say they will pay you tomorrow," he added. "But days and weeks go by and they don't pay. The dead must be turning in their graves."

(Writing by Deepa Babington; Editing by Andrew Heavens and Giles Elgood)