Books on Greece
Area (sq km)
% of GDP
Update No: 112 - (26/09/06)
Crisis in the Lebanon
The Greeks are naturally very concerned about the crisis in the Lebanon, a
country where Greeks have been prominent as merchants and professional people
for centuries. Greeks in Beirut were brought back to Greece for the duration of
The big question here is - should Greece intervene further, in the company of
European and UN peacekeepers? It is already involved in the existing UN interim
force in Lebanon (UNIFIL).
Foreign Minister Dora Bakoyannis also said that Russian president, Vladimir
Putin's visit to Athens in early September for a trilateral meeting with Greek
prime minister Karamanlis and Bulgarian president Georgi Purvanov to discuss
mainly advancement of the construction of the Burgas-Alexandropoulois oil
pipeline was an "important event". It certainly is that. Athens always
tilted towards Moscow in the later years of the Cold War after the departure of
the dread colonels in 1974.
It is doing so in a pragmatic way today, although the affinity between their
common Orthodox churches is of course a close bond. This does not exclude quiet
cooperation with Washington, as in the Iraq War (on the strict stipulation that
no open thanks were given), which has been deeply unpopular all along throughout
Asked if the long-awaited oil pipeline project would proceed, Bakoyannis said
that "all will go well", noting that Greece has evolved into an energy
hub in the region, due to the significant work accomplished by the development
ministry, and noted the importance of this to the country's foreign policy.
Putin duly arrived in Athens on September 4th for a trilateral meeting with
Karamanlis and Purvanov, at the Russian president's initiative, for talks mainly
focusing on the Burgas-Alexandroupolis oil pipeline. The agenda of the meeting
concentrated on energy issues, with the main thrust on the construction of the
Greece, Bulgaria and Russia signed a political agreement for the cross-border
pipeline, budgeted at approximately 700 million euros, on April 13th 2005 in
Thessaloniki. The 285-kilometre pipeline to carry Russian oil from Burgas in
Bulgaria to Alexandroupolis in northern Greece has an estimated investment cost
of 750-800 million US dollars with an annual capacity of 35 million tonnes of
oil. It will supplement a sea route through the Bosphorus for transportation of
the product in the region. It is anticipated that the pipeline will forge a new
outlet for Russian oil and for oil from the Caspian Sea to Europe and America.
An estimated 35-50 million tons of crude oil would flow through Alexandroupolis
in end-2008, while Greece will profit between 30 and 50 million dollars annually
from the transportation of oil via the Burgas-Alexandroupolis oil pipeline,
according to 2005 estimates.
In response to extensive Greek press coverage of the Karamanlis-Putin-Purvanov
meeting, government spokesman Theodoros Roussopoulos clarified that the exact
level of each side's participation in the oil pipeline project remains to be
decided, something expected to be cleared up at yet another meeting, in Athens,
of relevant energy Ministers of the three countries and representatives of
interested companies within the year.
For his part, Development Minister Dimitris Sioufas, who holds the energy
portfolio, said the joint commitment by the three leaders to sign a final
inter-state agreement within the year upgrades Athens' international position.
"In March 2004 we (the incoming government) found the plan in a state of
complete inertia, while since the summer of 2004 all three governments have
worked closely to promote the plan," he added, referring particularly to
the development boost expected to be reaped by the Thrace province.
Greece considers Russia as "strategic partner"
Prime Minister Karamanlis wanted to give the meeting a less mundane tone by
the end. He told Putin that Greece will further promote bilateral relations with
Russia, which Greece considers as a strategic partner.
Karamanlis underlined that Athens views Moscow as a "partner of strategic
importance," saying bilateral issues, regional cooperation and
international matters are on the agenda of talks. "Greece places particular
emphasis on the further development of relations with Russia in all sectors, as
well as in the boosting of relations between the European Union and
Russia," he said.
Putin replied to his host during the press conference after the tripartite
summit that the Athens meeting will allow the two sides to discuss bilateral,
multilateral and international issues, especially in the fields of energy sector
and financial cooperation. Putin told reporters that the relations between
Greece and Russia have a strategic character and do not concern energy alone.
He stressed that there is ground for more balanced and qualitatively better
trade and economic relations, military and technical cooperation and
coordination between Greece and Russia in the international field, where their
views coincide to a great degree.
Defence Minister on Putin visit
Greek Defence Minister Evangelos Meimarakis was the latest top Greek
official to comment on the high-profile visit. He took a more cautious line than
the premier and other ministers.
Meimarakis called the Putin visit "very useful", while he nevertheless
termed various local press reports citing purported "new deals" for
Russian weapons systems as "exaggerated".
"Greece is a country with open and transparent procedures for weapons
purchases. In every arms procurement programme we use international tenders open
to everyone ... and we, based on what serve Greece's best interests, the
available quality and the price, select the one that best one for the country's
defence," Meimarakis said.
Greek defence officials are keen not to threaten their very close ties to the
Pentagon, which is why they discreetly allowed the use of Aegean island bases in
the Iraq War by US forces and planes. Greece was a low-profile combatant in
effect that consequently escaped any terrorist backlash, unlike Spain and the
EU Commission approves regional support plan for Greece
Economy and Finance Minister George Alogoskoufis said that Ministry agencies
would accept the submission of investment projects - based on an existing
development law - by October 15th and stressed that approval of dismissal of
project would have been completed by December 31st 2006 before new increased
financial support was offered to private investors from January 1st 2007.
Speaking to reporters, the Greek Minister said the European Commission approved
a new charter of regional support for the period 2007-2013, the first country to
have the Commission's approval. Alogoskoufis said financial support to
investment projects reached 60 per cent, with support for larger enterprises at
40 per cent, medium-sized enterprises 50 per cent and smaller enterprises (97
pct of total Greek enterprises) at 60 per cent.
The Greek Minister said the Commission approved new higher financial subsidies
on investments after tough negotiations that lasted almost two years.
The upper limit of regional investment subsidies was set at 40 per cent for the
regions of eastern Macedonia-Thrace, Epirus and Western Greece, at 30 per cent
for Thessaly, Ionian Islands and Crete and 40 per cent for the Peloponnesus and
Northern Aegean (to be reduced to 30 per cent from January 1st, 2011).
Financial subsidies for investments in central and western Macedonia and Attica
were set at 30 per cent (to be reduced to 20 per cent from January 1st, 2011)
and for the south Aegean region 30 per cent and 15 per cent, over the same
Alogoskoufis said a total of 1,456 investment projects have been submitted so
far, budgeted at 2.3 billion euros, and that Ministry agencies have approved 682
A draft plan of a new development law is expected to be completed by October
15th and to be tabled to parliament as soon as possible to be valid from January
National Bank expansion in SEE continues
National Bank recently announced that it was continuing its drive towards
further expanding activities abroad, and in particular, southeast Europe.
Greece's largest financial institution stated its intent in a letter sent to the
Athens Stock Exchange, New Europe reported.
National Bank said it has submitted a binding offer for the takeover of Serbian
bank Vojvodjanska Banka and CEC in Romania. Serbian privatisation authorities
have also declared National Bank as a first-ranked bidder and the two sides were
currently in negotiations over the sale of Vojcodjanska Banka.
In the privatisation of CEC in Romania, National Bank - along with a
Hungary-based bank - have been included in a short-list of candidates and were
expected to submit improved offers.
In its letter to the Athens Stock Exchange, National Bank said it planned to
apply with Turkey's Capital Markets Commission for a public bid to buy minority
stakes in Finansbank AS and Finans Finansal Kiralama AS (Finans Leasing).
Turkish market authorities are expecting National Bank to ask for an exemption
from submitting public bids to buy minority stakes in Finans Yatirim Ortakligi.
Finanasbank recently completed the sale of its international stockholdings,
Finans International Holding NV and Finansbank Romania, to FIBA Holding AS for
600 million US dollars and repurchased 99.9 per cent of Finansbank Malta Ltd
from Finans International Holding NV for US$48m
NBG reports net profit growth 65%
The National bank of Greece said recently that net profit in the first six
months of the year rose 65 per cent because of growth in retail lending and the
sale of subsidiaries in North America. The bank, Greece's biggest, said net
profit in the first six months rose to 546.2 million Euro compared with 330
million Euro in the same period a year ago, New Europe reported.
The figure was helped by the sale of its Atlantic Bank of New York and National
Bank of Greece Canada, which resulted in 113 million Euro in profits. The bank's
operating profit rose 20 per cent to 1.28 billion Euro from 1.06 billion Euro,
while net interest income rose 17 per cent to 886.9 million Euro. Takis
Arapoglou, NBG chairman and CEO, said: "The group's performance reflects
above all an improvement in the Group's core income, given that in the second
quarter of 2006 adverse circumstances prevailed in international markets, which
did not allow for trading gains during the said period."
Subsidised interest rates for SME loans
The Greek government will begin a programme on subsidising borrowing interest
rates for small- and medium-sized enterprises from September 1st, Development
Minister, Dimitris Sioufas, said recently, New Europe reported.
Presenting the programme, Sioufas said the programme would run until end of 2008
and would include around 2,500-3,000 enterprises, while he stressed that more
funds would be earmarked under a Fourth Community Support Framework programme.
The programme will cover enterprises with a work-force of up to 20 persons and
self-employed with an annual turnover of 10 million Euro. Under the programme,
the government will subsidise 50 per cent of interest rates on loans and leasing
contracts on the precondition that loans would be used for development-modernisation
investments. The Greek minister said that only 20 per cent of Greek SMEs sought
borrowing from banks to cover their financial needs, a rate smaller compared
with the EU average. The development ministry has set up a commission to monitor
bank interest rates on corporate loans.
Bakoyannis meets with India's Sharma
Greek Foreign Minister, Dora Bakoyannis, met in Athens recently with Indian
Minister for External Affairs, Anand Sharma, as talks expectedly focused on
implementation of UN resolution 1701 for Lebanon and the situation throughout
the Middle East, New Europe reported.
Bakoyannis stressed, in fact, that Greece, which will hold the rotating UN
Security Council chair in October, "will do whatever it can to contribute
to this direction, and in general, to efforts for stability and peace in the
Middle East." She also briefed Sharma over her recent trip and contacts in
the Mideast, noting that "the time has come for vigorous diplomacy, both in
terms of Lebanon as well as over the Palestinian issue." On his part,
Sharma emphasised the need for increasing and boosting bilateral cooperation in
the fields of technology, communications, IT services, agriculture, science,
shipping and, of course, cultural exchanges.
Bilateral ties discussed with Albania PM
Greek Prime Minister, Costas Karamanlis, received his visiting Albanian
counterpart, Sali Berisha, on September 13th for a meeting and official dinner,
during which they discussed bilateral relations and also the Greek minority in
Albania, news agency ANA reported.
In statements afterward, Karamanlis said the meeting had been interesting and
constructive and had helped foster better understanding of the positions of both
countries on various issues. "The prospects for our relations are great and
I am satisfied, because today we confirmed our will to make further use of these
possibilities," he told reporters. The Greek premier said that there had
been significant progress in trade and economic ties, military and police
cooperation between the two countries, while he emphasised the signature of an
agreement on energy issues between Greece and Albania during Berisha's visit. In
addition to the problems of the Greek minority in southern Albania, the two men
also discussed problems faced by Albanian immigrants in Greece and those of
Greek businesses operating in Albania.
Karamanlis emphasised that Greece supports Albania's course toward EuroAtlantic
structures, to which it attaches great importance: "We are ready to assist
our neighbouring country in the effort to carry out the necessary reforms and
commitments to the EU it has undertaken," he stressed. Discussion during
the dinner between the two premiers focused on regional and international
issues, such as that of Kosovo, which Karamanlis described as important for
peace, stability and cooperation in the region.
On his part, Berisha thanked Greece for its support of Albania's efforts to
"realise its European vision" and for the Greece's contribution from
the 1990s until the present day to Albania's efforts to become a democracy based
on a market economy and to join the EU and NATO. The Albanian premier stressed
that the meeting had been marked by a spirit of understanding and determination
to further promote relations in economic cooperation, military cooperation,
education and culture and cooperation between legislative and executive organs.