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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: 080 - (01/01/04)

Looming Olympics
The big issue in Greece at the moment are the approaching Olympic Games, set for the summer of 2004, this year. By no means has all the preparatory work been done.
The preparations for the games, indeed, are not being well handled at home. The inveterate Greek habit of starting on a new project before an original one is complete is making it a close-run thing whether all the work will be done in time. This is by May this year. 
Nevertheless, the Nikea Weightlifting Centre was opened in October, delivered to the Organising Committee of the Olympic Games "Athens 2004". Centres for boxing, equestrian events, sailing and canoeing, swimming and rowing are complete or are nearing completion, as are stadiums for athletics. The Ministry of Culture has taken the opportunity of the Games to create a series of initiatives for children, with the Museum of Greek Children's Art. "The values of the Olympic Games" and 'my favourite sport' are two themes of choice.
The Games should boost tourism more just than temporarily. Tourism already contributes 2% of GDP in Greece. The aim is to raise this proportion to 3% at least by 2010. 
The country will in all probability have a new government by the time of the Olympic Games. The Pasok party has been in power for much the most of the last twenty years. It is generally thought that it is time for a change, as with the Conservatives in the UK in 1997. Their Greek equivalents, led by opposition leader Papandreou, are well ahead of the socialists in the polls and widely expected to win.

The trial of November 17
The Greeks were as upset by the terror attacks in Istanbul in November as anyone else.
They must have been reminded of their own terrorist organisation, November 17, which was busted earlier this year. The trial of 19 suspects is drawing to a close with numerous connections and only four defendants found not guilty.
November 17 derives its name from the brutal repression of a student demonstration on that day in 1973 by the Greek military junta, which fell the next year. On the same day ever since a demonstration has taken place passing by the US embassy, reminding everyone of the collusion of the US with the junta, not one of its brighter policy choices. 

Demonstration against the Americans; but Gusinsky goes free
The result has been visceral anti-Americanism ever since. Successive socialist governments in Greece used always to be unsparingly anti-American and pro- the Soviet world, partly in the latter case out of comfort with, and sympathy for fellow Orthodox, rather than Communism.
That there is still plenty of antipathy to current US policy in Iraq was shown by a big demonstration in Athens in November that brought out more than 10,000 Greeks in protest. They marched as per usual past the US embassy. They are certainly representative of Greek opinion generally, which was overwhelmingly against the war in March and April.
The Greeks are certainly not going to be sending troops to Iraq and Greece is not going to be on Bush's travel agenda shortly. Athens lent discreet support all the same to the US by giving it use of several Aegean bases for its aircraft. But as was said by a government source:" please don't thank us publicly."
When the Russians demanded the extradition of the big media mogul, Vladimir Gusinsky, in the autumn the request was rejected by a Greek court on October 15th. It said that the charges against him did not constitute a criminal offence under Greek law. There was not going to be any currying of favour with the Putin Administration, which Gusinsky's media empire has sharply criticised. The decision was at any rate a judicial one, not by the government.

The EU enlarges
The Greek presidency of the EU ended in June without the Greeks leaving a major mark. The adhesion of the ten admission countries is going ahead anyway. Fellow Balkan states will have to wait until 2007 at the earliest for inclusion. Serbia and Macedonia will probably have to wait longer. The very success of the Greeks in extracting large aid and credits from Brussels would be put in jeopardy by an undue enlargement so that Athens is not unduly upset.
The transition arrangements for the newcomers give Greek olive-tree and citrus fruit growers and grain farmers a reasonable reprieve, but the days of milking the EU for special funds, that in its heyday saw 6% of GDP funded from Brussels, are drawing to a close.
One problem is the growing scale of organised crime, which is coming into Greece from neighbouring transition states, notably Albania, Macedonia and Bulgaria. Trafficking in human beings and drugs, theft and property crime and the Turkish heroin trade are mounting threats as the borders are easier to cross and as the number of visitors for the Games will be soon rising. Organised crime is receiving a big fillip from EU enlargement, as borders become more porous.

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FINANCIAL NEWS

Greece fiscal deficit to stay flat in 2004 - OECD

The Organisation of European Cooperation and Development (OECD) recently announced that Greece's fiscal deficit will be at 1.6 per cent of gross domestic product (GDP). They said that the deficit rate would remain unchanged in 2004 and show a marginal drop to 1.5 per cent in 2005. They stated that the harmonised inflation is going to reach 3.5 per cent this year, 3.6 per cent next year and 3.5 per cent in 2005, the Macedonian Press Agency said in a report published recently.
The analysts estimated that the de-escalation of unemployment will be slow and its index will reach 9.3 per cent this year, 8.9 per cent next year and 8.8 per cent in 2005. On the growth rate of the Greek economy, the OECD analysts agreed with the estimates of the Greek Ministry of Finance for 2004.
However, they warned that in 2004 the growth rate of the Greek economy will weaken slight. The OECD predicts a growth rate of 4.0 per cent this year, 4.1 per cent next year and 3.6 per cent in 2005. The organisation's analysts suggest public spending cuts to limit the high public debt, pointing out that there is still a need to lift the obstacles in the job market and open the network markets to competition. 

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FOREIGN ECONOMIC RELATIONS

Balkans reconstruction plan on the right track

Greek Prime Minister Costas Simitis detailed the economic and political dimensions of Athens' ambition 550m Euro Balkan reconstruction and development plan during a recent address in the northern city of Thessaloniki. "Peace and stability in the Balkans cannot exist without their European vocations," Simitis was quoted as saying byAthens News Agency, before focusing on the plan's implementation over the past year and a half in six countries, namely, Serbia/Montenegro, the Former Yugoslav Republic of Macedonia (FYROM), Romania, Bulgaria, Albania and Bosnia-Herzegovina, New Europe has reported.
Simitis reiterated that Athens' plan is based on three initiatives, including private investments, which will absorb 20 per cent of the total package. The second initiative covers low-cost projects being overseen by the Greek diplomatic missions in each of the aforementioned countries (one per cent of the total), while a third initiative - which comprises the lion's share of the programme - deals with the financing of major projects, ANA reported. "Today we are in the plan's 18th month of existence with 29 private investments and 29 small projects already being implemented, while out of the 23 major infrastructure projects proposed by the Balkan countries and approved by Greece, six are in the process of implementation," Simitis said.
Regarding the fund for smaller projects, Simitis estimated that funding will be absorbed well ahead of 2006 when the plan is set for completion. As far as the major projects (79 per cent of the total) were concerned, he said that the government's monitoring committee has already approved 23 proposals, citing road works included in the Pan-European road network, the renovation of a government building in Sarajevo and the modernisation of the Danube River port of Lom, Bulgaria. Financing for the later will begin in late 2003 or early 2004, he said. 

Plias inks deals in Hungary, Spain

Plias Group recently clinched major deals in the Spanish and Hungarian retail markets, New Europe reported. In particular, the group announced that it has undertaken the production of items for Spain's retail chain DIA. Plias will cooperate with DIA for the production of glycerine soap, which was created by Papoutsanis especially for DIA. In the Hungarian market, Plias Hungary, the group's division in the republic, was scheduled to operate the distribution of Benetton cosmetics in the Hungarian market by the end of last year.

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INFORMATION TECHNOLOGY

SMEs keep favouring use of IT, Internet

Greece's Small and Medium Sized Enterprises (SMEs), employing between 11 to 250 workers, are presenting very high rates of computer use (92%), Internet access (74%), approaching European average rates (94%, 83% and 52%, respectively) an established survey said recently, ANA reported.
The annual report on the use of New Information Technologies & Communications by Greek SMEs, conducted in the framework of the e-Business forum and funded by an "Information Society" business programme, showed that Greek companies were increasingly satisfied with electronic transactions with the public sector.
Smaller enterprises, however, employing less than 10 workers, were showing less or no interest to new technologies, holding back efforts for a wider convergence between SMEs in Greece. The report underlined the need for more information and training of these businessmen to adopt new technologies. 
The survey said that Greek companies linked to the Internet rose 28% in 2002 to 19.6% of total companies, up from 15.4% in the previous year. Small- and Medium-Sized Enterprises reported a small increase in their use of computers (35.6% in 2002 form 34.2% in 2001).
The report also showed a surge by more than 10 percentage points in the rate of Internet use/computer use to 55.1% in 2002 from 44.9% in 2001, evidence of the rapid increase of businesses linking their computer systems to the Internet.
The report forecast a 5% increase in computer use and a 4% rise in Internet use in 2003 by Greek SMEs, with the sure of computer reaching 41% of total and Internet use 23% during last year.

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