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GREECE


 

 
Key Economic Data 
 
  2002 2001 2000 Ranking(2002)
GDP
Millions of US $ 132,834 117,200 112,000 28
         
GNI per capita
 US $ 11,660 11,430 11,730 48
Ranking is given out of 208 nations - (data from the World Bank)

REPUBLICAN REFERENCE

Area (sq km)
130,800

Population 
10,623,835

Capital 
Athens

Currency 
Drachma 

President 
Costas 
Stephanopolous

Private sector 
% of GDP
over 60%

  

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: 076 - (28/08/03)

The government reshuffle
The government is well aware that it is deeply unpopular. Nobody gives it a chance of winning the next election. The one thing that might be thought to be working for it, the imminence of the next Olympic Games, to be held in Greece in the summer of 2004, is in fact working against it. It portends, it is true, a big boost in popularity for the incumbent government as Greece bestrides the world stage and is host to the world's sporting elite. The inrush of visitors involved should presage a new long tourist boom. The massive upturn in infrastructure investment in anticipation of the Games is already stimulating a long growth in the economy. 
But the election is due in April, 2004, tantalizingly just too early for the party in power. What better time for a new order at the helm than when the world's spotlight is about to be on Greece! The opposition New Democracy is already in with a very good chance, being well ahead in recent polls.
The next election, moreover, promises to be decisive for a decade or more of Greek politics. The main problem is very simple. The ruling Socialist Party has been in power for far too long, in effect over twenty years, bar a brief blip. The population is convinced rightly or wrongly that the government, and above all the party, are profoundly corrupt.
The premier, Costas Simitis, leader of the Pan-Hellenic Socialist Movement (Pasok), has consequently gone in for a big shake-up of ministers. The most important change, however, has been the sacking of the secretary-general of the party, Costas Laliotis, who represents the old-fashioned left-wing of the party. A visceral anti-American, he became unpopular with the Greeks because of his cosiness with a group of local building contractors. He was then a long-standing public works minister.
Mr Laliotis has been replaced as secretary-general by a very different figure, Michalis Chrysohoidis, one of the modernizing faction of Pasok, who as public order minister was responsible, with some help from with Scotland Yard and the FBI, for the arrest last year of some 20 members of the notorious far left-wing terrorist group, November 17. This had been responsible in turn for the assassination of 35 foreign diplomats or Greek businessmen over the previous 25 years.

The task ahead 
Pasok is deeply committed to an extensive system of patronage. The party's top brass control most of the key public sector appointments, from university professorships to directorships of schools and hospitals and even football refereeships. Naturally the civil service is totally under their thumb. Businessmen who deal with government complain that corruption is still rife.
It is still too early to say whether Mr Chrysohoidis can bring a new broom to clear away the scallywags and scoundrels. Probably not enough of them in time for the election.
Mr Simitis has announced clean-up measures of his own. He has stipulated that Pasok's MPs can no longer hold shares in offshore companies, a favourite tax dodge for many of them. The Athens Stock Exchange watchdog will henceforward monitor MPs' brokerage accounts, a measure meant to reassure the people that Pasok stalwarts are not manipulating the bourse, as they were suspected of doing just before Greece entered the Eurozone when a febrile boom ensued and then collapsed. Simitis is right behind this move and in June sacked one minister, Stefanos Manikas, over the stock market scandal.
Simitis has also launched a "social convergence charter," emphasizing among other things the government's intention to lower unemployment and make the civil service more honest and efficient. Whether this plethora of new initiatives will be enough to win back the middle classes remains to be seen.

Terror experts in Olympics alert
Terror experts fear that the Athens games are " a peach of a target" for international terrorists. They could well be right, in which case the Games could turn out to be a disaster. There is a danger that the local police, chuffed by their success against November 17, are resting on their laurels.
Experts from seven countries, including the UK's MI5 and Scotland Yard, are helping out. The Games will have a massive security cordon of 58,000 officers, soldiers and safety volunteers. But the Greeks have not been as cooperative as the Australians, who hosted the 2000 Olympics. In central Sydney at this stage commandos in Black Hawk helicopters were conducting exercises. A western security official said:" the reluctance to get people to even share information here is very frustrating."
In May the Greeks finally agreed to set up a sophisticated command-and control communications network with an American company. The problems are huge, far greater than in Australia, long porous borders and easy access by sea from nearby countries.

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BANKING

NBG launches capital-guaranteed deposit-investment packages


The National Bank of Greece has introduced a new series of capital-guaranteed deposit-investment products (EPEAK), New Europe reported.
According to a bank announcement, these are special time deposits providing 100% guarantee of the initial capital at maturity, plus the possibility of higher returns (depending on the performance of the economic indices linked to the investment) than those offered on conventional deposit products. The minimum participation amount is €14,500.
The three new products of this series were available to investors via the Bank's branches from 16th July to 21st July 2003. The features of the new products are: the Euro/US$ RANGE-linked to the Euro/US$ rate. It is of two-month duration, commencing on July 22nd and maturing on September 22nd. At maturity, the investor will receive an annualised return of 3.40%, if the value of the Euro/US$ rate remains within the +3.50% fluctuation range (limits included) compared with the value on commencement date.
The FTSE UP - linked to the FTSE/ASE-20 index. It is of two-month duration, commencing on July 22nd and maturing on September 22nd. At maturity, the investor will receive an annualised return of: 4.50%, if on September 18th, the price of the FTSE/ASE-20 index is at least four per cent higher than its price on commencement date. FTSE Up or Down - linked to the FTSE/ASE-20 index. It is of three-month duration, commencing on July 22nd and maturing on October 22nd. At maturity, the investor will receive an annualised return of: three percent, if on October 16th the price of the FTSE/ASE-20 index is at least 10% higher or lower than its price on commencement date.

NRE price surge has no affect on Bank's figures

The Greek banking group recently issued a clarification note, according to which "the increase in the stock market price of National Real Estate SA (NRE) and other subsidiaries of the Group has no impact on its financials." "Only the sale of the shares and the realisation of capital gains through it would affect the Bank's figures," New Europe reported. NBG stressed that there was no intention of proceeding to any transactions in NRE shares. "This also applies to the companies of its Group," a press release said. The bank reaffirmed its review, assess and be informed properly of the performance and strategy of the companies in which they choose to invest."

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CONSTRUCTION

Ekter wins Ethniki construction deal

Greek technical company, Ekter SA, has been named the temporary bidder for a construction project at the building installations of the Greek General Insurance Anonymous Go (Ethniki). The competition took place on July 25th and Ekter offered 33.7m Euro.
The building complex is located at Syngrou Avenue and covers 43,000 sq.m as well as an underground parking lot stretching out to 37,000 sq.m.
The project's construction will last for 450 days starting from the contract signing date, due to take place next month.

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FINANCIAL NEWS

Measures taken to reform capital market's supervisory bodies

Greek Economy and Finance Minister, Nikos Chrestodoulakis, said that the government's measures to reform the capital market's supervisory bodies and promote structural changes have created the preconditions for a positive course of the domestic market. 
New Europe reported the minister as saying that the government's privatisation programme has raised €1.408bn so far, a sum expected to total €1.847bn by the end of August with the sale of a 33.4% equity stake in the Hellenic Stock Exchanges, the flotation of a 25% equity stake in Piraeus Port Organisation and the sale of a lottery licence.

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FOOD & DRINK

Coca Cola HBC making its way into Austria

Keeping its expansion strategy on a steady course, Coca-Cola Hellenic Bottling Company SA (CCHBC) recently announced its intention to acquire the Austrian mineral water company, Romerquelle GmbH, New Europe has reported.
The acquisition, which is subject to approval by regulatory authorities, involves production facilities at Edelstal and Pottsching and the mineral water and health brands Romerquelle and Markusquell, the company said through its press release.
"This acquisition is a significant further commitment to our operations in Austria," Managing Director of CCHBC, Irial Finan, commented. He stressed that Romerquelle and Markusquelle have great potential for continued growth in the rapidly expanding bottled water and health drinks sector. "The acquisition of Romerquelle GmbH complements CCHBC's strategy of selectively broadening its beverage brands to satisfy consumers," he noted.
For his part, Managing Director of Romerquelle GmbH, Anton Wandl, commented: "CCHBC and Romerquelle have had a long and successful partnership through an ongoing distribution arrangement. We believe that this acquisition will take the brand from strength to strength and will allow us to offer enhanced service to our customers and consumers in the growing water segment."
Coca-Cola HBC is one of the world's largest bottlers of the products of the Coca-Cola Company and has operations in 26 countries serving a population of more than 500 million people.

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TELECOMMUNICATIONS

Phase 1 for CosmOTE's WCDMA rollout kicks off

Sweden's Ericsson and Greece's CosmOTE have signed a letter of intent covering the initial phase of CosmOTE's WCDMA rollout in Greece, until the end of 2004, New Europe has reported.
According to an official announcement, Ericsson will deliver network infrastructure including core and radio equipment, and will support the 3G rollout with a full range of services.
"The Ericsson WCDMA solution will enable CosmOTE customers in Greece to continue enjoying advanced mobile services in the new 3G era. In addition to designing and implementing its 3G network, Ericsson has committed to work closely with CosmOTE in developing attractive end-user services in advance of the upcoming 2004 Olympic Games in Athens," a press release issued by the Swedish firm said.
"The start of the deployment of our 3G network in Greece is yet another milestone for CosmOTE and confirms once again the company's proven commitment to deliver the highest quality, and most user-friendly services to the Greek people," CosmOTE CEO, Evangelos Martigopoulos, noted. CosmOTE Board of Directors selected Ericsson as the main vendor for the first phase of its 3G development in their June 19th board meeting. The first phase covers the period until the end of 2004. "We are very honoured that CosmOTE has selected Ericsson as the main partner for their initial 3G network rollout," President of Market Unit South East Europe at Ericsson, Bill Sikou, said. 

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TRANSPORT

Aegek gets new road contract

Aegek has undertaken the completion of part of the Trikala-Arta national road - the Pahtourio-Aiga Kiriaki tunnel. New Europe reported that the project is budgeted at €21,244,567.49 (VAT included). 
In accordance with the contract agreement signed on July 14th, the completion date has been set for January 2007 (that is 42 months after the contract signing date). The main object for the new project will be the full construction of part of the tunnel Pahtourio-Agia Kiriaki tunnel, 3.5km long. Amongst other operations the project includes the opening of a 1,000 metre-long tunnel.

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