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GREECE


 

REPUBLICAN REFERENCE

Area (sq km)
130,800

Population 
10,623,835

Capital 
Athens

Currency 
Drachma 

President 
Costas 
Stephanopolous

Private sector 
% of GDP
over 60%

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Background:
Greece achieved its independence from the Ottoman Empire in 1829. During the second half of the 19th century and the first half of the 20th century, it gradually added neighbouring islands and territories with Greek-speaking populations. Following the defeat of communist rebels in 1949, Greece joined NATO in 1952. A military dictatorship, which in 1967 suspended many political liberties and forced the king to flee the country, lasted seven years. Democratic elections in 1974 and a referendum created a parliamentary republic and abolished the monarchy; Greece joined the European Community or EC in 1981 (which became the EU in 1992). 

Update No: 073 - (27/05/03)

The unpopular war
There is a long tradition of anti-Americanism in Greece for more reasons than one. The US was accused of complicity with the Greek colonels' junta between 1967 and 1974, as was King Constantine who lost his throne as a result. Before that the US played an interventionist role in the Greek Civil War, which angered those of left-wing opinion. Greece long tilted towards Moscow in the Cold War.
As with the American-led intervention in Kosovo, the war in Iraq has been profoundly unpopular, 94% being opposed in the polls. Demonstrations in Athens have been huge and some violence against US property has erupted. Graffiti of a crude anti-US kind are all over the place.
It is curious that the removal of a vile regime in Baghdad should so enrage the Greeks, who blame the Americans for colluding with one in Athens thirty years ago. But the prevalent view is that the US is once again pursuing its interests under a mask of hypocrisy. The Greeks are as certain of this as are nearly all Arabs that Princess Diana was murdered at the express order of Prince Philip by British intelligence. To doubt either plot is to them to to be deemed guilty of the utmost naivety. 

Embarrassed government
The government has taken a very different line. It has been helping the US all along. The key port and airfield, Souda Bay in Crete, was on the quiet handling thousands of flights and ships en route to the Gulf. The socialist government made noises of dissent from Washington, but no more than advocating a diplomatic solution. In fact their position was tactical. As occupants of the EU presidency a moderate approach was mandatory to try and bridge the TransAtlantic divide.
The US-born foreign minister, George Papandreou, comes from a dynasty of pro-American stamp. He fielded the flak from the anti-American camp. Premier Costas Simitis, an austere economist, has had a lower profile on the issue. He is known to be far more concerned to promote progress on the Lisbon Process, which since 2000 has been trying to further EU reforms. These were sidetracked by the Iraq crisis, obviously to his annoyance, so that less public disapproval attaches to him.

Countdown to the Olympics
Now that the war is over, the government is pushing the coming Olympic Games in 2004 as the big world event. For Greece to hold the games in the first decade of a new century, indeed a millennium, is clearly appropriate to the embattled government. Iraq should be well and truly forgotten by then.

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AVIATION & SPACE

Final countdown for Hellas Sat begins

Greece's first satellite mission is ready to press the button for the final countdown, after having negotiated technical problems that had led to the first launch suspension of Hellas Sat.
The satellite launch has been scheduled at 17.57 until 18.31, on Monday May 12th, local time at Cape Canaveral, Florida, US. The Greek satellite will orbit at 39 degrees east approximately one week later. Its life duration is estimated at 15 years.
The Hellas Sat satellite introduces Greece as one of the world's countries with "space presence" and constitutes a strategic choice with significant advantages on political, financial and technological levels.
Furthermore, the new satellite is one of the most up-to-date, equipped in such a way as to cover Europe, Middle East, Africa and North East-Central Asia.
Through both its fixed and mobile transmitters, the satellite will offer a series of telecommunications and teleoptical services. Last but not least, the new satellite will allow the practices of telemedicine, teleducation, upgrade communication operations among the public service and contribute to the most effective broadcasting of the Olympic Games

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CREDIT RATINGS

Moody's upgrades Alpha's short-term credit rating

Alpha Bank SA, one of Greece's leading banks, has been notified by Moody's Investors Services that its short-term credit rating has been upgraded to Prime-1 from Prime-2, New Europe reported. "Alpha was one of the A3 long-term rated European banks selected for this upgrade by Moody's" the bank informed through its recent press release. 
"The banks covered by these short-term rating upgrades are institutions based in developed banking markets and are characterised by relative stability and predictability of their fundamentals as defined by a low singLe-A long-term rating. These fundamentals include a core defensible franchise and market position - primarily retail-based - national, regional or local. They also include good and predictable liquidity; stable funding - mainly retail - as well as conservative reliance on short-term market funding," the Moody's report read. "A3-P-1 rated banks would also display low-to-moderate asset volatility, evidenced by the lack of large pockets of high credit risk concentrations that could be of a peculiar concern, as well as low appetite for riskier and potentially shelter these banks from more significant credit transition risk, therefore justifying P-1 ratings compatible with A3 long-term ratings," the report concluded.

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ENERGY

Signing of SOCAR- Depa gas transit deal set for June

An agreement between the Azeri state oil company, SOCAR, and the Greek state gas company, Depa, to transit Azeri gas through Greece to western Europe will be signed in Baku during the June 3rd-6th period, a source in the Greek embassy in Baku told journalists.
Interfax News Agency quoted him as saying that the signing of the agreement would be timed to coincide with the exhibition-conference Caspian Oil, Gas, Oil Refining and Petrochemicals - 2003. The source said that SOCAR management and Depa Director General Vasilios Jonbonopulos, held talks in the Azeri capital.
The main item on the agenda was the draft gas transit agreement between the two companies. It is planned that Azeri gas from the Shah Deniz field will be transported to Greece through Turkey, using a new transport corridor. The last talks between SOCAR and Depa were held in Athens in December 2002. 

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FINANCIAL NEWS

Booming shipping sector supports activity in tough year, NBG analysis

The National Bank of Greece (NBG) has published the March 2003 issue of the Greek Economic and Market Analysis, offered to local and international investors. The Bullet is presenting all recent development and trends of the Greek economy and its financial markets. According to the bank analysis, Greece's economy is bound to recover due to its booming shipping industry, New Europe reported. 
Despite the weak international recovery, shipping is experiencing a price boom. NBG projects that the sharp freight charge increases the sector experienced in Q4 2002, will fade during the current year, though on average, charges will remain significantly higher in 2003 compared with 2002 (21 and 28 per cent respectively for dry cargo and tankers).
The positive spill over on the Greek economy from a resurgent shipping sector will be sizeable, as the Greek owned fleet is the largest in the world, and a significant share of its revenues pass through the Greek economy - in large part linked to their reliance on Greek banks.
As a result, current account revenues from Shipping should increase by €660m (0.45 per cent of GDP), which should provide a direct and indirect boost to growth in 2003 of 0.6 per cent. This development would work to offset a reduction in tourism of about 6 per cent, if it were to occur. Activity and the current account will benefit in 2003 from a growth in imports that is less than that of the economy (2.7 per cent compared with GDP growth somewhat higher than 3.5 per cent. A sectoral analysis of imports reveals that the low income elasticity of imports derives from the composition of growth, with construction now being the engine of growth, compared with business investment and consumption, especially of durables, in the past.

Philip Morris buys in Greece

Shareholders in Papastratos, the Greek cigarette manufacturer that distributes the Marlboro brand in south-east Europe, are set to approve a €370m (US$420m) take over by Altria's Philip Morris International unit, The Financial Times reported on 7th May.
The acquisition gives the US company increased access to markets in Romania, where Papastratos has a Greenfield plant with capacity to produce 3.5bn cigarettes a year, as well as Ukraine and Russia.
"With this acquisition we obtain attractive, growing trademarks in the Assos, President and Papastratos brands," said Andre Calantzopoulos, PMI's chief executive.
PMI is making a cash offer of €18.50 a share for the 76 per cent stake held by members of the Averof family. The offer would not include the 2002 dividend of €1 per share, which would be paid to current shareholders.
Philip Morris said it would make a public offer for the remaining 24 per cent of Papastratos within 30 days of completing the deal.
Papastratos's own brands have a 15 per cent share of the Greek market, and it distributes about 40 per cent of cigarettes sold to Greeks, the heaviest smokers in the European Union.
"This is a positive development for Papastratos following our longstanding cooperation with Philip Morris. It will secure the company's long-term future," said Titos Komninos, Papastratos chief executive.
Papastratos has cut costs and boosted income since the Averof family handed over day-to-day running of the company to professional managers two years ago. Net profit last year increased 7 per cent to €39.3m on sales up 6 per cent to €403.7m.
Mr Kominos said the price could be cut, depending on due diligence.

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