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Another economic crisis is looming, and Europe’s most downtrodden country is scrambling to cope with tens of thousands of refugees. How does it survive?

As you approach the northern Greek city of Kozani, which stands on a plateau surrounded by mountains, you start to see smoke—thick white clouds floating above the knotty shrubs and sun-dappled hills of Western Macedonia. This is the heart of Greece’s coal industry; the plumes come from the chimneys of power stations dotted around the region.

HERE TO STAY: In March, Macedonia sealed its border with Greece, leaving tens of thousands of refugees trapped in Greece, which had previously been mainly a transit route for people heading farther north. Soon after, the EU and Turkey agreed to send back migrants to Turkey, sparking protests.

When most Greeks think of Kozani, they think of coal. In the 1950s, the Public Power Corp. (PPC), now Greece’s biggest electric company, took over the mines here and brought prosperity to this poor, largely agricultural corner of northern Greece. Locals soon abandoned their traditional ways of making a living: saffron cultivation, marble production and fur-making. Mining was not easy, but the workers were well-compensated. The city’s businesses flourished.

Those days are long over. Kozani, a small city of 75,000, has gone from providing 70 percent of Greece’s electricity to less than 40 percent. Fifteen years ago, the PPC employed about 9,000 people. Now that number has dropped by a third. Unlike the slow and steady decline of other coal towns in Europe, Kozani’s slump has been rapid, accelerated by the Greek debt crisis that began in 2010. In Western Macedonia, the region where Kozani lies, roughly one in three citizens is unemployed, twice the rate of 2001. Among 15- to 24-year-olds, that number soars to more than 70 percent, the highest of any region in Europe. All of Greece has suffered through the financial crisis—within the past decade, it has experienced the biggest drop in happiness of any country in the world—but in rural areas like Kozani, Greeks say they have been hit especially hard.

Volunteers have been handing out food

“We built our lives around the coal mines,” says Ioannis Kostarellas, 35, who grew up in Kozani. “The energy from here powered the whole country, but now we are being left to deal with our problems alone.” Those problems kept mounting: unemployment, environmental damage left by the mines, an exodus of young people. Residents felt things could barely get worse in Kozani. And then, in February, the refugees arrived.

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Greeks Bearing Thrift - Another economic crisis is looming, and Europe’s most downtrodden country is scrambling to cope with tens of thousands of refugees. How does it survive? by Naina Bajekal