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GREECE


 

 

In-depth Business Intelligence

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 173,000 132,834 117,200 27
         
GNI per capita
 US $ 13,720 11,660 11,430 45
Ranking is given out of 208 nations - (data from the World Bank)

Books on Greece

REPUBLICAN REFERENCE

Area (sq km)
131,940

Population 
10,647,529

Capital 
Athens

Currency 
Euro

President 
Costas 
Stephanopoulos

Private sector 
% of GDP
over 60%



Update No: 099 - (26/07/05)

Athens offers London its security expertise after deadly attack 
Just a day after it was congratulating London and offering advice on hosting the 2012 Olympics, Greece on July 8th was offering condolences and help in security matters to the British government after a terrorist attack on the city left at least 55 people dead. "This act of blind violence underlines the fact that the threat of international terrorism is still real. Faced with this common threat, our commitment to confronting it effectively remains strong," said Prime Minister Costas Karamanlis in a letter of condolence to his British counterpart Tony Blair after three bomb blasts on underground trains and one on a public bus in the centre of London rocked the city less than 24 hours after it had been awarded the 2012 Games.
Security at the British Embassy in Greece, Athens International Airport, the metro and other potential terrorist targets was immediately boosted. Authorities in Cyprus, where Britain has two military bases, also stepped up their police presence. However, Public Order Minister, Giorgos Voulgarakis, said that Greece was an "extremely safe country" and offered Britain the services of skilled Greek officers who were highly trained in anti-terrorism matters in the build-up to last summer's Olympics in Athens.
Greece had received substantial help from Britain in security matters as it prepared for the pressures of holding the world's biggest sporting event last year, spending 1.2bn euros in the process. Voulgarakis said he had informed the British Ambassador to Greece, Simon Gass, that the government was ready to reciprocate by sending officers to London "if it is deemed useful."
Meanwhile, Gass thanked Greece for its support. "I am thankful for the expressions of condolence that have inundated the embassy from the Greek government, political parties and normal citizens," he said, "I believe that the democratic way of life, which is valued so highly in Greece as it is in Britain, is made stronger by the desire of terrorists to spread death and destruction."
Security sources, involved in the operation during the Athens Olympics, told Kathimerini that the attack on London was "unique" because the city was prepared for a hit, yet there was little chance of it being avoided. Voulgarakis, meanwhile, said that he would be travelling to London soon to meet with his British counterpart.

Karamanlis to visit Ankara soon
There is nothing like having a common enemy to bring old enemies together. Greece had long had its own terrorist organisation called 'November 17,' bred of the disastrous junta of the Greek colonels in 1967-74 and the animus against it, while the Turks have had to face a brutal terrorist movement among extremist Kurds. They were both of them among the first to express solidarity with the British in their predicament.
Karamanlis will pay an official visit to Ankara in the near future, Greek Foreign Ministry Spokesman, Yorgo Kumuchakos, said on 7/7 itself, as it is now being called. ''Although the date of the upcoming visit is not certain yet, Karamanlis' visit will help find new avenues to develop existing ties between Turkey and Greece,'' Kumuchakos told a news briefing. 
Asked by a journalist if Karamanlis' visit to Ankara will be before or after October 3rd (when entry negotiations will begin for Turkey), Kumuchakos remarked that he sees no relationship between Karamanlis' visit and the beginning of entry negotiations. 

Greece pledges commitment to economic reform, spending cuts
As regards domestic matters, Greek PM, Costas Karamanlis, at a cabinet meeting, which focused on energy policy and the judicial official's promotions, appeared determined to proceed with the radical changes and the reforms his government announced. 
Karamanlis asked his Ministers to raise productivity levels and pointed out that the reactions to the reforms come from those who have been benefited by the current situation for years. He also stressed that radical changes and reforms are the only solution against Public Sector's malfunctions. 
At the same meeting, Development Minister, Dimitris Sioufas, referred to the major energy works as well as the study the government prepares with a view to unifying the excise duty on diesel and heating fuel to avert tax. 
Finance Minister, Giorgos Alogoskoufis, said on 7th July that the government is committed to adopting measures that would bring its large budget deficit under control. Alogoskoufis said Athens is determined to bring the deficit below 
3 % by the end of 2006, from 6.1% at the end of 2004. 
He admitted Greece faces many problems, particularly an overhaul of the pensions system. His comment was in response to a report by the OECD that said Greece faces "huge challenges" in the years ahead.

Cabinet approves farm bill to spur growth
Greek Prime Minister, Costas Karamanlis, and his cabinet recently approved a farm bill that aims to spur growth in the sector and align with the European Union's new common agricultural policy. The wide-ranging legislation is destined for parliament in the near future. "It will support young farmers, reduce bureaucracy and deal with farmers' day-to-day problems," ANA quoted the architect of the bill, Agricultural Development and Foods Minister, Evangelos Basiakos, as saying. "A series of moves contained in the ruling New Democracy party's manifesto will be implemented that target growth of the agricultural economy," Basiakos told a news conference.
Among innovations in the bill are short-term, interest-free loans to aid operational spending for young farmers in mountain and deprived regions of the country, and medium-term lending in the same categories for the acquisition of key equipment and machinery. Interest-free loans will also be awarded for the purchase of farmland. In other categories, a loan-subsidy of 70% is to be offered.
In addition, the bill will legally sanction the creation of agricultural development centres around the country that the government has begun to set up in line with EU policy from 2007. Each prefecture will open one centre, employing a nationwide total of 325 farming specialists. Falling under the jurisdiction of central regional authorities, the centres will provide scientific, professional technical and technological support for farmers, the minister said. Services will also help farmers to keep up to date on European sector programmes and adapt crop cultivation. One of many aids on offer are data provision on the type, variety and quality of crops available to farmers.

The fountainhead of democracy; Athens to Washington
Greek Prime Minister, Costas Karamanlis, recently visited the United States, a visit that included a meeting with US President George W. Bush at the White House - the second such meeting in a year. If Athens was the origin of democracy and of its forcible promotion to other states in Ancient Greece, as it was, why should it not back its avatars today in the shape of the neo-cons in Washington?
Government spokesman, Theodoros Roussopoulos, noted that the premier first briefed the president of the republic over results of his talks with US leadership, followed by briefings of the country's political leaders. Roussopoulos accompanied Karamanlis on his US visit.
During his regular press briefing, the spokesman highlighted Bush's comment of a "strategic partnership" with Greece, as well as the latter's praise for the two countries' bilateral cooperation. "We hadn't been accustomed (in the past) to seeing such gestures, quite the opposite, I would say," ANA quoted Roussopoulos as saying.
Queried about closer ties with Washington vis-à-vis the fight against international terrorism by Islamist groups, Roussopoulos said: "An international effort has existed since the end of the 1980s to expand democracy. Our country, which gave birth to democracy, has played a significant role in this effort, both in the Balkans and in the wider Middle East region… Greece considers that this effort should not be restricted only to the greater Middle East, but should be of a longer duration and involve a greater geo-political area."
He added, "This initiative is developing in numerous ways, and it's a happy coincidence that Greece has just concluded its successful chairmanship of the Black Sea Economic Cooperation Organisation (BSEC) while at the same time assuming the rotating presidency of the South East Europe Cooperation Process (SEECP). Roussopoulos also stressed Athens' continuous efforts at ending the Balkan peninsula's unfavourable portrayal as "Europe's powder keg."
Finally, Roussopoulos again emphasised Athens' disagreement with Washington's abrupt recognition last November of the Former Yugoslav Republic of Macedonia (FYROM) as simply "Macedonia," a name sternly opposed by Athens and the only remaining thorn in otherwise excellent Greek - Macedonian relations. "We trust that the United States will buttress the United Nations' effort at finding a solution (to the name issue)," he added.

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BANKING

Alpha Bank posts Q1 gains, expansion abroad bears fruit 


Alpha Bank, a leading bank in Greece, reported a 4.8 per cent jump on net profit for the first quarter of 2005, totalling 96m Euro, the bank said in a statement recently, New Europe reported. 
Earnings per share was 0.41 Euro in the reported period, against 0.39 Euro, the bank said. Recurring earnings climbed 9.2 per cent to 109.8m compared to 100.5m Euro in the same period last year. 
Alpha Bank said net interest income totalled 273.1m Euro, up 10.8 per cent, against 246.4m Euro.
The bank statement said that key developments for the boost in profits included: strong capital adequacy even after its recognition of the pension fund deficit; retail banking momentum underpinning fast organic growth; international expansion at the forefront of our strategic objectives; costs adjusted for one-offs grow only by 2.9 per cent supporting underlying strong profitability; and head office organisational changes driven by retail strategy and corporate governance agenda.
"Our bank expands rapidly in retail banking in Greece and invests abroad, in order to maintain strong profitability over the longer term. By encouraging growth and innovation at all levels of the organisation, we create a large and powerful bank that will eventually become the point of reference in the financial services sector in the wider southeastern European region," said Alpha Bank's Chairman Yannis S. Costopoulos. "Our vision is to replicate the strong franchise we have in Greece in all the countries in which we establish a presence. In the process, we create more value for our shareholders," he added.
"In the first three months of 2005, we made significant progress in building our retail business, gaining market share in consumer credit and mortgages. With the acquisition of Jubanka, we made a big step forward to strengthen our position in southeastern Europe," noted Demetrios P. Mantzounis, managing director, Alpha Bank. "At the same time, we continued to contain costs despite rising expenses related to retail business volume growth, as well as to opening branches and hiring personnel abroad," he added. "Following the application of international accounting standards, our sound financial and strong capital position is confirmed. In this context, prospects for a more dynamic advancement in the future are being strengthened while we all at Alpha Bank work for the next day with vision, plan and resolve."
As regards loans and advances to clients, the bank said they grew 13.5 per cent year-on-year to 24.2bn Euro by March 31, 2005. Customer assets climbed 4.7 per cent to 34.1bn Euro in the same period, while liquid customer balances (repos, synthetic swaps and money market mutual funds) continued to decline. 

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ENERGY

Greek-Turkish pipeline to carry Caspian gas to Europe 

With crude oil prices hitting another record high above US$62 a barrel recently, a decision to build a natural gas pipeline connecting Turkey and Greece to transport Caspian and Central Asian natural gas to Europe seems more relevant than ever. 
The inauguration of works on July 3 by Greek Prime Minister, Costas Karamanlis, and his Turkish counterpart, Recep Tayyip Erdogan, was, as expected, overshadowed by the political dimension of the project.
But there is the practical side of the pipeline project: The pipeline aims to diversify resources. "Beyond this flamboyant show of friendship, this project may actually lead to diversification of energy sources at a time when oil prices are soaring," former Greek Energy Minister, Eleftherios Verivakis, said.
Julian Lee, an energy analyst with the Centre for Global Energy Studies, said it will take time for the diversification of gas supplies to Europe. "I don't think it will be particularly quick. What it does do is open southern Europe in particular to alternative gas supplies from the Caspian region that in the past have not be suppliers to Europe," he said, New Europe reported.
The 300-kilometre pipeline from Bursa in Turkey to Komotini in Greece is expected to be operational in 2006. Construction was scheduled to start at the beginning of July.
The pipeline is initially expected to transport four billion cubic metres of gas a year, with capacity eventually increasing to 11.5bn cubic metres once it is connected to two other planned pipelines, and as demand for Caspian gas - an alternative energy source to the politically volatile Middle East - expands in coming years.
The plan for the first pipeline is that it will run for 600 kilometres across northern Greece from Komotini to the northwest Greek port of Stavrolimena where it will connect with a 220-kilometre pipeline under the Ionian and Adriatic Seas with Italy as part of an extensive pipeline initiative known as the Southern Europe Gas Ring Project.
Greece and Italy signed a protocol of cooperation in June foreseeing the construction of the underwater natural gas pipeline connecting the two EU member-states. The underwater pipeline is to be constructed by Greece's natural gas supplier Depa and Italy's Edison and is expected to be completed by 2010.
Lee said that the gas pipeline should benefit all parties involved. "It gives Russia an alternative export route into southern Europe; it clearly provides Italy, Greece and perhaps eventually other European countries with diversified supplies; it allows Turkey to re-export some of the additional gas it has contracted to buy and now finds that perhaps it has no domestic use of; and in time it will give Azerbaijan certainly a route to selling gas into Europe. So I think that in that sense all of the countries involved in this project will see benefits from it," the London-based analyst said.
European countries are eager to reduce their reliance on Russian gas. "I'm sure that diversification is a part of the reason behind this (Greek-Turkish pipeline) and I'm sure that some governments feel perhaps slightly more comfortable as a result of this. But I don't think that anyone has suggested that (Russian gas monopoly) Gazprom has been an unreliable supplier of gas in the past," Lee said.
Turkey's Botas is expected to use some Russian gas to fill the pipeline to Greece. "Turkey will be on-selling presumably some of the gas that it has bought and doesn't have a domestic market for. That would predominantly be Russian gas from Blue Stream. Once the gas is in Turkey it may be more difficult to work out actually whose gas it is that's getting shipped on because Turkey is currently buying gas from Russia, Iran and very shortly it will be taking gas deliveries from Azerbaijan's Shah Deniz field," Lee said.
Greek officials at the office of Deputy Development Minister, George Salagoudis, said that under the agreement signed with Greece, Turkey will act both as a source and a transit country for natural gas.
"Depa has signed an agreement with Botas where it will receive approximately 700-800m cubic metres of natural gas. In this case Turkey will act as a source," an official from the development ministry told New Europe, referring to the contractual agreement that has drawn fire from some Greek politicians. Moreover, former Energy Minister Verivakis said the deal "grants to much economic and political control to Turkey."
At the same time Depa has signed two memoranda with Iran and Azerbaijan which means that gradually Depa will also receive gas from these countries via Turkey. In this case Turkey will function as a transit country, the development ministry official said.
Turkey has been trying to expand its role as an energy conduit, connecting Europe to the oil and gas riches of the Caspian Sea area in Azerbaijan and Kazakstan Central Asia. In May, the presidents of Georgia, Turkey and Azerbaijan opened a pipeline that will transport up to one million barrels a day of Caspian oil and gas through the southern Turkish port of Ceyhan. Greece, in turn, is looking to become an energy junction in the Balkans. Russia, Bulgaria and Greece signed a memorandum in April in Sofia for the construction of a pipeline to carry Russian oil from Bourgas to Alexandroupolis.

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FOREIGN COOPERATION

Greece, Turkey sign justice cooperation protocol

Greek Justice Minister, Anastasios Papaligouras, and his visiting Turkish counterpart, Cemil Cicek recently signed the first cooperation protocol between the two ministries since 1974, New Europe has reported.
The protocol concerns the transfer of know-how in matters of justice and administering justice. More specifically, it was agreed to commence an educational programme for Turkish justices and to set up special training programmes for candidate Turkish judges, which will be held in Thessaloniki and in Turkey. Meanwhile, a programme for the twinning programme was underway for the founding and organisation of the institution of ombudsman in Turkey, with the provision of know-how by the Greek ombudsman, and with EU funding. In addition, the signing of a twinning programme on copyright matters with the European Centre fro Public Law was also imminent.

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FOREIGN RELATIONS

Strong Greece-Russia ties 

Greek Foreign Minister, Petros Molyviatis, recently visited Moscow and attested the strong ties that Greece and Russia have, the Greek Foreign Ministry's spokesman, Georgios Koumoutsakos, said recently, Itar-Tass News Agency reported.
On the agenda was a meeting between Molyviatis and his Russian counterpart Sergei Lavrov. The entire range of bilateral relations, including economic relations, were discussed during the meeting, according to the spokesman.
Koumoutsakos told reporters that regional problems were also be examined, taking into account the situation in the Balkans and in the Middle East. "In this framework, the debate touched upon the Black Sea Economic Cooperation Organisation," the ministry's representative was quoted as saying. "The United Nations activity, Russia's relations with the European union and NATO also came up for discussion," he noted.

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TOURISM

Avramopoulos vows to bolster tourism

Greek Tourism Minister, Dimitris Avramopoulos, recently stressed the importance of upgrading the quality of Greece's tourism product during a ceremony for the annual awards given by the Hellenic chamber of Hotels at the Hotel Grande Bretagne in central Athens, ANA reported.
Avramopoulos stressed that the ministry's efforts were aiming in this direction and that quality would give Greece a competitive advantage over other tourist destinations. He also stressed the need to change shortsighted, price-gouging attitudes by certain businesses in the tourist sector, which sought to gain maximum profits in a short space of time, and said the ministry will crack down on profiteering. The minister announced that the National Tourism Council will be held for the first time in Thessalonica on July 4th with the participation of all tourism bodies and pointed to the benefits of the new developmental law, while he called for the closure of uncompetitive hotel units. Also presented at the awards was the result of a survey by the magazine Money and Tourism, according to which Greek hotels were marginally cheaper than their western European competitors, sometimes even than their equivalents in Turkey.

Avramopoulos meets China tourism administration chief 

Greek Tourism Minister, Dimitris Avramopoulos, on June 21 met the head of the China National Tourism Administration, Shao Qiwei, during an official visit to China. In statements afterward, Avramopoulos said that important facts had emerged during the meeting and that a visit by a Chinese minister to Greece might be expected in this context, New Europe reported.
The two men discussed future estimates of tourist traffic between Greece and China, with Greece anxious to increase the numbers of Chinese tourists visiting the country. According to Avramopoulos, the Chinese show a great interest in Greek culture but Greece had failed to make it onto the "map" of favourite destinations for the Chinese in recent years. Later that same day Avramopoulos inaugurated an exhibition of contemporary Greek art in Beijing entitled "The Art of Greece meets China." He also inaugurated the tourism trade fair BITE, at which Greece is the honoured country, as well as an office of the Greek National Tourism Organisation (GNTO) in Beijing.

 

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