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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: 094 - (24/02/05)

Profile of a new premier
Greece does not like to admit it: but it is a profoundly Balkan country. Clan feuds dominate politics. The key is the family one happens to belong to.
The new premier of Greece, Constantine Karamanlis, elected almost exactly a year ago in March, 2004, as the head of the conservatives, was born in Athens in 1956. He studied Law at Athens University and attended post-graduate studies at the Fletcher School of Law and Diplomacy in the USA.
The essential point is that he was nephew and namesake of the former president of the Republic and New Democracy (ND) founder: he is a member of the Society of Macedonian Studies and life-member of the "Konstantinos G. Karamanlis" foundation.
He joined the ND party youth organisation in 1974. He was elected president of the peace organisation KIPAEA and the Greek Centre for the Promotion of European Unification "Europe '92", in 1986. He entered law practice and became a contributor to the Athens weekly "Oikonokikos Tachidromos", in 1987.
He won a comfortable victory in the March 7 2004 general elections over rival Pasok's leader Georgios Papandreou (45,4% VS 40,5%), the key to his present renown. 
Papandreou is a scion of the other great Greek political dynasty of late, the Papandreous, who dominated the twenty - year reign of the socialists. Plus ce change; plus c'est le meme chose.

Rapprochement with Turkey
The new Greek premier is proving, for all his conventional primogeniture, to be capable of original thought. He is almost certainly behind the fact that the head of the Greek navy travelled in Turkey at the end of January for a rare visit, becoming the first Greek commander ever to come to the country on an official mission.
Vice-Admiral Antonios Antoniadis held talks with his Turkish counterpart, Ozden Ornek, in a meeting closed to the press. He also visited navy facilities in Istanbul and Golcuk in the northwest of the country before returning, the Turkish navy said in a statement. Greek commanders have in the past visited Turkey but only for multilateral meetings hosted by Ankara. Antoniadis was the first to come for an official visit.
The Greek commander's four-day visit comes against a backdrop of recent accusations between Ankara and Athens over violation of each other's territorial waters in the Aegean Sea which separates the two countries. Despite a significant rapprochement in recent years, NATO members Turkey and Greece remain at loggerheads over various territorial rights in the Aegean Sea and regularly accuse each other of violations and harassment.
In January 2002, the two neighbours launched closed-door talks to resolve their disputes. But there has so far, until this visit, been no indication of significant progress.

The Rise of the original Karamanlis 
After obscure Balkan machinations, Greek Prime Minister Papagos died in office in 1955. During his tenure, an obtruse politician, Konstantinos Karamanlis, had risen quickly in the Greek Rally Party. In the Papagos government of 1952-55, Karamanlis was a very effective, although autocratic, minister of public works. When Papagos died, King Paul surprised observers by choosing Karamanlis to form a new government. The forty-eight- year-old Macedonian reorganized the Greek Rally Party as the National Radical Union (Ethniki Rizopastiki Enosis--ERE) and proceeded to hold power until 1963. 
During the Karamanlis years, the economy continued to grow by most statistical indicators, although it remained under state control and did not develop in new directions. Growth was especially fast in construction, shipping, and tourism. The state bureaucracy, the largest employer except for agriculture, became bloated, inefficient, and politically entrenched in this period. The service sector was the fastest growing element in the Greek economy. Overall, the standard of living of the majority of Greeks improved markedly in the 1950s in comparison with the sufferings of the previous years. Between 1951 and 1964, average per capita income quadrupled, and prices remained stable. 
In foreign relations, the two dominant issues of the immediate postwar era, the Cold War and Cyprus, remained critical for Greece. Karamanlis was firmly convinced that Greece's fortunes lay with the West and that Greece must become "European." Karamanlis wanted to move closer to Europe than membership in NATO alone, so in 1962 he won associate status for Greece in the European Community (EC) with the promise of full membership in 1984. He also established close personal contacts in Washington, receiving an official visit from the United States president, Dwight D. Eisenhower, in 1959. No other United States president visited Greece until 1990. 
The other overriding issue of the day was Cyprus. The postwar climate of British decolonisation had led to expectations that Cyprus, whose population was 80 percent Greek, might become free to join with Greece. There were two obstacles: Cyprus's strategic importance to Britain and the Turkish population on the island. For Britain, Cyprus had a special role in protecting British oil supply lines from the Middle East. In 1954 Britain's foreign secretary, Anthony Eden, had stated simply that, because of that factor, Britain would never relinquish Cyprus. The sizeable Turkish population on the island meant that Turkey also had a stake in the future disposition of the island, if Britain were to agree to any change in its status. 
In 1955 the EOKA campaign of violence and terrorism aimed at disrupting British rule and uniting Cypriot Greeks with Greece. After years of conflict and delicate negotiations, the interested parties finally reached a settlement in 1959. The island would be independent and ruled by a joint Greek and Turkish government formulated roughly according to the size of each population. The president would be Greek, the vice president Turkish. Greeks were awarded 70 per cent of seats in parliament, with the Turkish minority holding veto power; 60 per cent of the army was to be Greek. Britain retained one airfield and one army base, and Greece and Turkey were able to station military advisers on the island. The three nations jointly guaranteed the security of the island, and each had the right to intervene to defend it. The establishment of even temporary peace on Cyprus was a major accomplishment, but this solution was not popular in Greece.
Since then, Greece suffered a military coup and in the years before democracy was restored, attempted to seize Cyprus by force, incurring a Turkish invasion in response. Ever since the island has been partitioned, despite which represented solely by the Greek side it was accepted into membership of the European Union.

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AVIATION

Ecofin minister Alogoskoufis, transport minister Liapis discuss Olympic Airlines

Economy and finance minister, George Alogoskoufis, and transport minister, Michalis Liapis, held a meeting recently at the national economy ministry to discuss the national carrier Olympic Airlines, Athens News Agency reported. 
Although no statements were made after the meeting, sources said the two ministers discussed a current international tender for the sale of a majority stake in the national carrier. 
The sources said that "more than five" tenders have been submitted by interested buyers from both Greece and abroad. 
The more attractive tenders for the purchase of OA would be discussed in the near future, the sources added. 

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BANKING

Bank of Piraeus gets Eurobank's Bulgarian units

Greece's Bank of Piraeus recently announced the signing of an agreement with Petrol Holding AD for the purchase of 99.7% in Eurobank Bulgaria as part of a bank's plan to further expand its activities in southeastern Europe and strengthen its international business, ANA reported.
Eurobank has operated a network of 48 branches in Bulgaria during its presence in the last 10 years in the country. Eurobank's assets total 220m Euro, loans total 120m Euro and savings deposits total 165m Euro. The bank employs 600 people in the country.
A Bank of Piraeus announcement said Eurobank's branch network would operate in addition to its existing network in Bulgaria, raising its total network to 61 branches in 28 cities. Savings deposits total 225m Euro and loans 310m Euro. Bank of Piraeus will hold a share of more than 4.2% in the Bulgarian banking sector.
The bank expects its net profits to reach 9.0m Euro this year. Bank of Piraeus said its expansion in Bulgaria was of strategic importance since the country's banking sector was rapidly growing (loans grew an annual 37% in 2004) and offered significant growth prospects. The Greek bank has also expanded activities in Romania and Albania. Its branch network in all three Balkan states total 98 units, with assets of 1.0bn Euro and loans of 580m Euro.

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FINANCIAL NEWS

IMF praises growth in Greek economy over recent years

The International Monetary Fund's (IMF) executive directors recently backed up an appraisal by the IMF's staff analysts for the Greek economy, which cited "past reforms, financial market deregulation, interest rate declines associated with euro adoption as well as a stimulus from Olympics spending" as responsible for the strong growth in the economy over recent years, Athens News Agency reported. 
However, a press release from the executive board meeting, noted that "widening economic imbalances threaten future growth prospects. The public finances have deteriorated sharply - only in part because of the Olympics - and the high debt-GDP ratio has fallen very little, with recent data revisions revealing that the fiscal position is much worse than earlier thought," a reference to the recent fiscal audit completed by the government. 
Concerning the controversial fiscal audit undertaken by the Karamanlis government and sharply attacked by the main opposition PASOK party, the IMF stressed that "Directors welcomed the initiative by the new government to launch a fiscal audit immediately upon taking office," while adding that the IMF "regretted the significant past understatements of the deficit and public debt." 
The international organization warned that lack of accurate fiscal data "has hindered surveillance…" but supported "the ongoing efforts of the authorities, working with Eurostat, to improve reporting, and the decision to compile financing-side fiscal data beginning in 2005." 
Among others, the IMF executive directors said the key priorities for Greek officials are a strong and sustained fiscal consolidation effort "along with further improvements in fiscal transparency, and structural reforms to put in place the conditions for sustained increases in output and living standards." 

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FOREIGN RELATIONS

Turkey's National Assembly speaker emphasizes the improvement of Greek-Turkish relations

Bulent Arinc, Speaker of the Turkish Grand National Assembly, emphasized the steady improvement of Greek-Turkish relations as he welcomed Greek Justice Minister, Anastasios Papaligouras, to the Turkish Grand National Assembly recently, Athens News Agency reported. 
Arinc thanked Papaligouras for his visit and stressed that relations between Greece and Turkey are steadily improving both on a government level, as well as on a ministerial level. 
Papaligouras, on his part, said that the Greek government warmly supports Turkey's European prospects and stressed that "the government believes that this course will contribute to promoting and reinforcing Greek-Turkish relations." 
The Greek justice minister was in Ankara following an invitation by his Turkish counterpart Jemil Cicek. 

Greece, Serbia seek closer business ties

Greece and Serbia-Montenegro are seeking closer business ties, speakers told the final day of a conference in Athens on cooperation between the two countries, Athens News Agency reported. 
The speakers noted that Greek investment had made a key contribution to modernization of Serbia's economy, especially in banking, financial services, insurance, telecoms, industry and construction. Also valuable was Greece's involvement in growth plans for southeastern Europe's energy network. 
Previously, Development Minister, Dimitris Sioufas, had told the meeting that the government was working for closer ties between the European Union and Serbia-Montenegro, 
"Greece is working to advance European association for Serbia-Montenegro, and its future entry into the European family...Ours is the first EU country to have devised an integrated national action plan for reconstruction of the Balkans," Sioufas said. 
Outlining the government's Balkan policy, the minister noted a bill was in the pipeline to set up an international university in the northern port city of Thessaloniki; incentives were available for the creation of cargo transit centres; and a natural gas pipeline to Austria through the Balkans was being urged. 
Greece's investment level in Serbia-Montenegro is high with about 150 joint enterprises in operation, and 80 purely Greek companies with a staff of around 18,000, according to data from the Greek embassy in Belgrade. 
Three major Athens-quoted banks are active in Serbia - National Bank of Greece, Alpha Bank and EFG Eurobank Ergasias. Alpha Bank recently purchased Serbia's Jubanka. 

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TOURISM

Liaskos expresses optimism over 2005 tourism season

Greek Tourism Deputy Minister, Anastasios Liaskos, recently expressed his optimism over this year's tourism season in Greece, ANA reported.
After a three day visit to the International Tourism Fair CMT in Stuttgart, Liaskos said he received positive messages for the country's tourism in 2005. The CNT fair attracted more than 1,400 exhibitors from 82 countries around the world and 200,000 visitors. The Greek minister met with the prime minister of the Baden-Wuttemberg state, Stutggart's mayor and diplomats. Liaskos met with exhibitors, businessmen and representatives of local authorities in Germany.

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TRANSPORT

Greece, Bosnia sign agreement for road transports

The Greek and Bosnian transport ministers recently signed a memorandum of cooperation in the field of overland passenger and cargo transportation, including two-way routes and transit hauls, Athens News Agency reported. 
The agreement was signed in Athens by Greek Minister, Mihalis Liapis, and his Bosnian counterpart, Branko Dokic. 

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