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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: 107 - (28/04/06)

Greece Backs EU Membership of Bulgaria and Romania
There is nothing a Greek leader likes better than playing the elder statesman to lesser Balkan brethren. As an established member of the EU, Greece has a head start over its ne'er-do-well neighbours, naughty communists before.
Greece backs the EU membership of Bulgaria and Romania, Greek Prime Minister Costas Karamanlis pronounced in mid-April, according to the Macedonian agency Makfax. Mr Karamanlis stated that the whole region would benefit from the two countries' accession. 
During his visit to Sofia, the Greek Prime Minister met with his Bulgarian counterpart Sergey Stanishev, only a year or two into his job, like the Greek premier. 
They discussed Bulgaria's EU accession and the cooperation between Bulgaria and Greece in the fight against disasters, highly topical in the light of recent floods. "I hope that we will soon have a flood warning system in the border areas," Mr Karamanlis said.
The two prime ministers signed a declaration of friendship and cooperation, as well as an agreement on the opening of a new border checkpoint in the town of Ivailovrad.

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Actually, however, in Greek politics, as in Clinton's America, foreign policy takes second place. It is always a question of 'the economy stupid.' 

Parliamentary debate over economy
On April 14th, a vibrant discussion over the economy, presided over by political leaders, was made amid raised voices in Parliament. It is notable that President of PASOK George Papandreou, the Greek Clinton, had requested the discussion. 
In his speech, the Prime Minister, Costas Karamanlis, defended the current reforms and policy, stating that they would continue, aimed as they are at growth and better competitiveness of Greek products, and based on a revolution in quality. The Government's priority is to boost employment and the support of underprivileged citizens. 
On the other hand, Mr Papandreou invited Mr Karamanlis to join him in a tour of regional areas, where they could answer residents face-to-face. Meanwhile, KKE General Secretary Aleka Papariga criticised the two big parties. In closing, SYN President Alekos Alavanos accused the Government of deregulating the market, of an unfair tax policy and of decomposing the public sector. 

"A Secret Programme" 
The Prime Minister fiercely criticised Mr Papandreou and the work of the previous socialist government, in power for twenty years, speaking of a "secret programme" by PASOK for the economy. 
"Some are counting backwards. It is not the Government that made proposals for uninsured employment in Lavrio, the supposed Scandinavian model of dismissals and high taxation," said Mr Karamanlis referring to the revelations by former PASOK Economics Coordinator Giorgos Floridis and the positions of Mr Papandreou's advisor Mr Polemarchaki of incentives for raising age limits. 
All the above, continued the Prime Minister, revealed the economic frustration of PASOK, its double identity and secret plans and called on George Papandreou to claim responsibility of making proposals, instead of submitting inaccuracies, distortions and exaggerations. 
Referring to competitiveness, he noted that it cannot be achieved only with a low labour cost, but the utilisation of new technologies, strengthening of productivity and a "Greek revolution of quality." 
Mr Karamanlis described the winding-up of the broader Public Sector and the law on DEKOs as a crucial and important change, while he hailed the agreement reached by FGI and GSEE on the Collective Work Contract, voicing the Government's satisfaction on the development. 
"New Democracy is implementing its own secret programme, taking off the mask of the centre-right, which it used to claim power," answered PASOK President George Papandreou to the PM and called on Kostas Karamanlis to join him in a tour of the Greek regions. 
"Let's go to Imathia, Pieria, Kilkis, let's visit Macedonia, which is being inflicted by unemployment and tell its residents that unemployment has decreased during your rule. And there, we can talk about my proposals in Lavrio and see who is promoting uninsured employment," said the leader of the main opposition. 
In his speech, Mr Papandreou referred to the financial state of the citizens and consumers, accusing the Government of fooling the employees and pensioners with increases which are immediately spent on increases in heating oil, gas and transport. 
The centre-right wing is not about gifts to bankers, arrogance and the return of police forces, but it is a tough new-right wing, noted Mr Papandreou. Answering to the criticism on uninsured employment and the Swedish model, he said that he would use the experience of all socialist parties around the world, including the Scandinavian model, but certainly not Karamanlis' model.

Karamanlis remains preferred PM for Greeks
Karamanlis, the premier for two years, is still the top choice to head Greece's government, according to a poll by VPRC released by SKAI Radio on April 14th. Some 43 per cent of respondents think Karamanlis is the most qualified person to serve as prime minister, down five points since March.
Karamanlis led the conservative New Democracy (ND) to a victory in the March 2004 election, securing 165 seats in the Greek Parliament. The Pan-Hellenic Socialist Movement (PASOK) had administered the government since January 1996. 27 per cent of respondents would prefer current PASOK leader George Papandreou-a former foreign minister-as head of government.
On April 13th in Parliament, Karamanlis alleged that PASOK sought to implement higher taxes, declaring, "In response to a demand for insured labour, they respond with eliminating social insurance contributions. In response to a need for tax stability, they propose plans leading to tax raids, while accusing everyone else of what they are themselves considering."

Southeast Europe Culture Ministers Meet in Greece
There is more to Greece than its economy and contemporary politics of course. It has one of the most prestigious national names imaginable, heir to the marvel that was Ancient Greece.
Culture Ministers from South-East European Cooperation Process (SEECP) member-states have met recently in Greece, Greek TV station Antenna reported. 
The meeting took place in Patra on April 14th and was opened by Greece's Culture Minister Georgios Voulgarakis.
The forum took place within the framework of Greece's SEECP Presidency. This was the first forum in which the Culture Ministers of Albania, Bosnia and Herzegovina, Bulgaria, Macedonia, Croatia, Serbia and Montenegro, Turkey and Romania took part. Moldova participated as an observer.
During the meeting the countries in the region were informed about the opportunities to participate in European cultural events. 
On April 16th the Ministers left for Thessaloniki where they met with Prime Minister Karamanlis.

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AVIATION

Greece not to buy 10 additional F-16s 


Greece decided recently to scrap an option to purchase 10 additional F-16 fighter planes from US defence contractor Lockheed Martin, the country's military council (KYSEA) said, cited by Deutsche-Presse-Agentur (dpa). 
"With a great deal of respect towards the Greek public's money, the Greek tax payer, and with the sense of responsibility - and not to affect the equilibrium of the needs of the air force, KYSEA has decided not to proceed with the decision to buy the additional 10 F- 16's," said Greek Defence Minister, Vangelis Mimarakis. Last year, KYSEA approved the purchase of 30 F-16 warplanes in a deal valued at 1.1 billion Euro with an option to purchase 10 more from the United States. It had decided to go with the US made fighters rather than the European-made Eurofighter. The decision by the newly elected Conservative government to scrap the deal with the Eurofighter and to go with the Americans had caused a lot of controversy, namely because the government was being secretive about what weapons the planes would be equipped with.

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BANKING

Greek bid wins bank in Turkey

National Bank, Greece's largest lender by assets, said it will pay 2.3bn Euro for a 46 per cent stake in Finansbank in Turkey, trumping a bid from Citigroup, the International Herald Tribune reported on April 4th.
The deal, for the equivalent of US$2.8bn, is the largest overseas investment by a Greek company and one that some analysts thought might be hampered by politics. Greece and Turkey remain at odds over Cyprus and territory in the Aegean.
The Greek bank said it will offer to buy out minority shareholders in the stake to at least 50.01 per cent.
The Finansbank owner, Hunsnu Ozyegin, will keep a 10 per cent stake in the mid-sized bank for at least two years and his company, Fiba Holding, will pay US$580m to buy a controlling stake in Finansbank.
Turkey, with a population of 72 million, represents the new frontier for international banks seeking growth. The start of European Union membership talks in October and falling interest rates in a more stable economy form the backdrop to an expansion in credit.
Turkey's economy has bounced back after a deep financial crisis in 2001 and its economy grew 7.6 per cent last year. Last year, Fortis Bank bought Disbank and BNP Paribas purchased TEB. General Electric bought a US$1.8bn stake in Turkiye Garanti Bankasi in August, in what was Turkey's biggest bank sale to date.
"Turkey is in the very early stages of growth, so there's huge potential," said Idil Dagdelen, an analyst at Bender Securities, an Istanbul-based unit of Deutsch Bank.
Finansbank's net income rose 68 per cent last year to 470.2m lira, or US$349m, after it increased loans by a third. The shares have more than tripled in the past year, partly on expectations of a sale.
National Bank's offer values Finansbank at US$6bn, compared with its current market value of US$5.4bn. Both banks' shares were suspended from trading recently. 
Shares in National Bank, the biggest company by value on the Athens exchange, with a market capitalisation of 13bn Euro, have more than doubled since Takis Arapoglou took the helm in 2004.
Arapoglou, the chairman and chief executive, has cut the staff at the former state-controlled bank by about 10 per cent, and sold or shut units in Western Europe, the United States and Canada to focus on Eastern European markets, betting that EU membership will spur loan demand there much as it did in Greece.
Analysts expect smaller Turkish banks to offer themselves for sale as the sector consolidates. Mid-size Denizbank is seen as the next foreign acquisition target, according to analysts. Its majority owner, Zorlu Holding, has hired JP Morgan to look for a deal for the bank. 

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ENERGY

Greece to further invest in Libya's oil industry

Visiting President of the Hellenic Republic, Karolos Papoulias, expressed Greece's desire to further invest in Libya's oil industry during his meeting with Libyan Prime Minister, Baghdadi Mahmudi, in Tripoli recently, ANA reported.
"A new chapter regarding Greek-Libyan relations has begun with a new momentum that is based on mutual political volition to promote relations for the benefit of both peoples," Papoulias said during the signing of two bilateral agreements in the tourism and cultural exchanges sectors. "Greece and Libya can also cooperate in the Balkan and Black Sea regions," ANA quoted Papoulias as saying.
Mahmudi, who signed the agreements with Greek Culture Minister, George Voulgarakis, and Deputy Foreign Minister, Evripidis Stylianidis, said he was pleased with Papoulias' visit, who he called "a beloved friend of the leader of the revolution."
Mahmudi also referred to a new period of economic cooperation between the two countries and called on the Greek business community to invest in Libya.
Later, Papoulias met with Libyan leader, Muammar al-Qaddafi, in a cordial atmosphere. 
Papoulias and Qaddafi talked for about an hour, both at the meeting that took place in the presence of Boulgarakis, Stylianidis and Deputy Foreign Minister, Yannis Balynakis, and Deputy National Economy and Finance Minister, Petros Doukas, as well as at the dinner which Qaddafi hosted in honour of the Greek delegation. The two leaders did not make any statements.
Athens, however, expressed concern after Libya's state oil company published plans to issue permits for exploration and drilling in areas south of the Greek Mediterranean islands of Crete and Gavdos.
The issue gained attention after Libya's state oil company reportedly published an energy map on its website showing territory and waters in Libya and beyond where the company could consider issuing permits for exploration and drilling.
"The extent of the area pictured on the map in question is such that it creates ambiguities as to the potential for conveying rights for economic exploitation in areas south of Crete, as well as the island of Gavdos," Greek foreign Minister spokesman, George Koumoutsakos, said in a statement.
"The ambiguities of this particular map rendered necessary its clarification through actions undertaken by the foreign ministry on an official and political level."
According to international law, any county has the right to explore underwater natural reserves up to 200 nautical miles from its coast. Qaddafi has recently sparked interest in investing in Libya by pursuing economic reforms in an effort to encourage foreign oil companies to return.

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FOREIGN RELATIONS

Greece, US discuss "strategic" partnership 

Clarifying points raised during her earlier meeting with US Secretary of State, Condoleezza Rice, and US Under Secretary for Political Affairs, Nicholas Burns, Greek Foreign Minister, Dora Bakoyannis, recently denied that the Annan plan was "history," saying that the UN Secretary-General's proposals should form part of new initiatives for Cyprus, New Europe reported.
"A new initiative for the Cyprus issue must be based on the ideas of the UN Secretary-General, on the European reality in which Cyprus has been living for the past two years and which has created an entirely different dynamic and, of course, the decisions of the United Nations over the past years," she told Greek journalists at a press conference held in the Greek Embassy. She was responding to questions that noted the lack of references to the Annan plan by either herself or Rice during their joint statements. Earlier, US Assistant Secretary for European Affairs, Daniel Fried, emphasised that the US government will never recognise two states in Cyprus. He stressed that the US is against recognition, against division, against partition adding that Washington supports reunification on the basis of a bizonal, bicommunal federation. He pointed out that the US cooperates with the Turkish Cypriot regime because its leadership wants a solution. "We cooperate but we do not recognise them," he said. At the press conference, Bakoyannis said her US visit was an opportunity to renew and update the "historic relationship" between Greece and the United States, while noting that a number of important developments had occurred since the last visit by her predecessor, Petros Molyviatis, such as the start of talks on the future of Kosovo or EU decisions regarding the western Balkans.

Stylianidis visits Armenia 

The political will to strengthen economic and trade relations and develop cooperation between Greece and Armenia was confirmed in Yerevan recently with the signing of a cooperation protocol by Deputy Foreign Minister, Evripidis Stylianidis, and with the bilateral contacts the Greek deputy minister had with Armenia's political leadership. The promotion of the two countries' bilateral relations is a commitment by Prime Minister, Costas Karamanlis, and Armenian President, Robert Kocharian, during the latter's visit to Athens in November 2005, Stylianidis said and termed Armenia a "strategic partner of Greece in the region of the Black Sea." With the signing of the economic, industrial, technical and scientific cooperation protocol, the work of the fourth Joint Interministerial Committee, at which economic and development issues were examined and which was jointly chaired by Stylianidis and Armenian Agriculture Minister, Davit Lokyan, came to an end, New Europe reported.
After the signing of the document, Stylianidis expressed satisfaction over the new mobility and the positive reaction of the Armenian side to resolve "pending issues of the past," as he said, that concern Greek investments in Armenia. The Greek side placed particular emphasis on development cooperation, stressing that Armenia constitutes a basic priority of its development policy. It is characteristic that during the 2001-2004 period it has spent US$9.5 million for this purpose and in a "mutually beneficial" way, the Greek deputy minister said. The sectors for financing development projects in Armenia include agriculture, tourism, support for small and medium-size businesses and infrastructures. The protocol also anticipates, in the framework of backing economic relations, cooperation in the energy sector, as well as the creation of better conditions to improve the investment climate. Resolving existing pending issues with Greek companies will contribute to a climate of stability and reliability for increasing Greek investments.

 

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