Books on Greece
Update No: 118 - (29/03/07)
New Democracy consolidates its pole position
It is three years since the present Greek government was elected in March 2004.
All in all, it has done pretty well. It admittedly had the good fortune to come
in at the right time, when Athens hosted the 2004 Olympic Games, a historic
event for the Greeks of course. They enjoyed basking in the world's attention
and tourism has received a permanent boost.
In the latest opinion poll to be published in March, ruling New Democracy (ND)
held a 3.2-percentage point lead over rival main opposition PASOK party, 36.3
per cent to 33.1 per cent. The poll, conducted by the firm MRB for a private
Athens television station, was held between February 26th and February 28th on a
nationwide sample of 1,000 respondents via telephone interview.
The Communist Party of Greece (KKE), which has a long history in Greece, almost
coming to power in a civil war in the 1940s, was preferred by 7.7 per cent of
respondents, followed by the out-of-Parliament Popular Orthodox Rally (LA.OS)
with 3.7 per cent and the Coalition of the Left (Synaspismos), with 3.1 per
cent. The level of undecided voters reached 14.8 per cent, a large figure, as
new elections approach.
However, Prime Minister Costas Karamanlis leads PASOK leader George Papandreou
by 18.4 points on the question of who is more capable to hold the premier's
post, 47.9 per cent for the former to Papandreou's 29.5 per cent. This is
especially significant in a polity increasingly 'presidential' in style, a
common trait of democratic politics everywhere.
Profile of the New Democracy leader
Karamanlis comes of a distinguished dynasty, being a nephew of the former
President of the Hellenic Republic, Constantine Karamanlis. Politics is in his
blood. He is also highly educated. He studied at University of Athens's Law
School and at the private Deree College, continuing with postgraduate studies in
the Fletcher School of Law and Diplomacy at Tufts University in the United
States, where he gained a master's degree and a doctorate in political sciences,
international relations and diplomatic history.
Karamanlis is the youngest ever Greek Prime Minister, and the first born after
World War II, in 1956.
Helped by the unpopularity of the PASOK government (a party that had been in
power between 1981-1989 and from 1993 to 2004), led by Costas Simitis, ND
defeated the Socialists' George Andreas Papandreou in the March 2004 elections.
Karamanlis stated that the priorities were education, economic policy,
agricultural policy, lowering the large level of unemployment (standing at
11.2%) and a more transparent and effective state administration. Economic
policy cantered on tax cuts, investment incentives and market deregulation.
While early problems included a large public debt (about 112% of GDP) and a
budget deficit (5.3% of the GDP) in excess of Eurozone stability rules,
Karamanlis's government had halved the budget deficit to 2.6% by 2006.
Papandreou unveils new PASOK policy platform
PASOK leader George Papandreou is, nevertheless, fighting back. He addressed
a mass rally of PASOK supporters and top cadres in early March, capping off a
week of high-profile activities by the party that included a presentation of its
voluminous policy platform statement, the means to fund proposed spending hikes
and a convening of PASOK's national council.
Papandreou repeated his heated criticism of the government and appeared
confident of election victory in the next poll, while at the same time warning
of "major interests" attempting to manipulate and control the party,
interests he said want PASOK to "compromise." In fact, Papandreou's
address swayed back-and-forth from detailing PASOK's positions on a variety of
issues to airing charges against the government.
He echoed other top PASOK officials' accusations over the past week over the
government's culpability in the mismanagement of pension funds' assets, while
referring to "shadowy games" between riot police and masked
self-styled anarchists that often infiltrate protests through central Athens
before engaging in vandalism and clashes with authorities. "You cannot
identify the younger generation with masked troublemakers, slackers and the
apathetic," he said in reference to the government, noting that education
issues should not be handled by the public order ministry, an indirect rebuke
over the role of police during protests.
In turning to one of the three "axes" of PASOK's programme, as he
said, Papandreou touched on the "green" aspect of economic
development, while at the same time charging that the government is only
interested in selling-off forestlands and coastal areas, as seen from its intent
to revise Article 24 of the Constitution.
Regarding foreign policy, he said the government is falling back on mere
"public relations tours," accusing it of being absent from
international developments. In playing up the party's social agenda, Papandreou
said the government has proceeded with an "unrestrained redistribution of
wealth," saying the maxim is now to "catch the little guy and be
lenient to the powerful." On the social front, he said PASOK will promote a
"new contract for employment," boost the number of preschools, all-day
elementary schools, improve hospitals and institute at at-home support
programmes. "Eradicating poverty is, for PASOK, a political choice. We must
end with poverty in our country," he said.
He promised that if elected to government PASOK will institute a fairer tax
system, one able to restore social justice "with a redistribution of wealth
in favour of the weak via taxation." Moreover, he promised the hiring of
3,000 staff every year in the health care system, which he said the ND
government has abandoned.
Papandreou also launched into an attack on recent opinion polls, saying the
issue is one of quality of democracy, objectivity and transparent financial
dealings of the firms involved. "We will not back down from our principles
and will govern without dependence on anyone, with our head high, expressing the
true will of the Greek people."
Three Nations Finalize Oil Pipeline Deal
Meanwhile the business of government goes on. Bulgaria, Greece and Russia
have signed an agreement finalizing the details for the construction of a
long-awaited oil pipeline that will funnel Russian oil directly to southeastern
Europe - bypassing Turkey's busy Bosphorus Straits.
No immediate details were announced about the cost of the privately funded
project, in which a 175-mile pipeline will be built, but experts had estimated
it at between US$1 billion and US$1.3 billion.
The pipeline will bring Russian oil from Bulgaria's Black Sea port of Burgas to
Alexandroupolis in northeastern Greece, bypassing the environmentally vulnerable
Bosphorus Straits. Russia is expected to have a 51 per cent share in the deal,
with Bulgaria and Greece splitting the remaining 49 per cent.
In discussion since the early 1990s, the venture received new interest because
of high oil prices.
The Burgas-Alexandroupolis pipeline, tentatively scheduled for completion by
2010, would initially carry 700,000 barrels of oil a day port through a 36-inch
pipeline, with capacity set to eventually rise to more than 1 million barrels a
Russia's Gazprom-Neft and Rosneft are to participate in the venture, along with
Russian-British venture TNK-BP, Bulgargaz and Terminal Universal Burgas from
Bulgaria, and Greek companies Hellenic Petroleum and Thraki.
Last September, Russian President Vladimir Putin, Greek Prime Minister Costas
Karamanlis and Bulgarian President Georgi Parvanov met in Athens to pledge
political support for the project. Putin last week again urged faster progress.
It remained unclear whether the agreement would resolve a dispute between Sofia
and Moscow over ownership of the Burgas oil terminal. Opposition lawmakers in
Bulgaria argue the deal should be scrapped if Russian companies are granted
Burgas-Alexandroupolis could compete with another planned pipeline venture.
Macedonia, Albania and Bulgaria have agreed to build an east-west pipeline from
Burgas to the Albanian port of Vlore. The 556-mile pipeline is also due to be
completed in 2010, costing an estimated US$1.2 billion.
New energy horizons for Europe
The European Commission welcomed an intergovernmental agreement to construct a
Trans-Balkan pipeline that will be built on EU territory, bypassing the crowded
Bosporus Straits. "It is going to alleviate the pressure on a very
environmentally-sensitive area and it is going to increase the security of
supply by providing an alternative route for the transit of oil. So, however you
look at it, it's positive," Ferran Tarradellas Espuny, spokesman for Energy
Commissioner, Andris Piebalgs, New Europe reported.
A day earlier, at the Presidential Mansion in Athens, Russia, Greece, and
Bulgaria in excellent ambience signed an agreement on the construction and
operation of the Bourgas-Alexandroupolis pipeline. Russian President Vladimir
Putin, Greek Prime Minister, Costas Karamanlis, and Bulgarian Prime Minister,
Sergei Stanishev, attended the signing ceremony, marking a new era for the
transport of Russian and Caspian crude to Europe.
Signing the agreement on behalf of the three countries were Greek Development
Minister, Dimitris Sioufas, Russia's Industry and Energy Minister, Viktor
Khristenko, and Bulgarian Regional Development Minister, Asen Gagaouzov.
The Greek premier, in full command of the signing ceremonies, told a
well-attended press conference this "historic day" is the result of
intensive preparation leading to the implementation of this strategic project.
"This has been a pending issue for 14 years and it is now being managed in
the best possible way for the benefit of all," said Karamanlis, who helped
overcome last minute obstacles in negotiations.
He pledged that Greece will continue to work on the pipeline at the same intense
pace in order to make up for lost ground and complete the work as quickly as
Karamanlis said this project will place Greece and Bulgaria on the energy map.
"Apart from individual benefits for individual countries this is a wider
issue and a wider project that will be beneficial for the global energy market
since it facilitates access to oil and products that are important
Putin defined the project's significance for energy security, noting that the
Trans-Balkan pipeline will provide an opportunity to think about expanding
supplies from the Caspian region through Russian territory.
"We are all equally interested in making this project happen. Bulgaria,
Greece and Russia are equally interested in the construction of this pipeline,
but, of course, as my colleague - the prime minister of Greece - said this is a
project that is interesting for all the energy markets globally because the
implementation of this project also provides a scope for further considerations
on how oil will be brought further from the Caspian Sea," Putin said in
response to questions. "It will be very interesting for US companies, Azeri
companies or Kazak companies. This will also increase energy supplies for the
In turn, Stanishev said the pipeline is of geo-strategic significance and will
play an important role in strengthening energy security. "This is a new
beginning of an era to come which should lead to great infrastructure works and
projects which should play a very important role not only in Greece but rather
It's notable that the Russian president stressed that the pipeline will be
filled with new volumes of oil, which will be transported through Russia among
Assessing the Russian president's statements, the EU energy spokesman welcomed
the possibility of using Kazak and Azeri oil for the pipeline. "That's
perfect. That's reasonable because from a commercial point of view the more
people you have using the pipeline, the more money you are going to get. So it
will be risky to say they cannot use Kazak or Azeri oil, if they don't have
enough oil to fill it," Tarradellas Espuny told New Europe.
The agreement to build the Bourgas-Alexandroupolis pipeline could also have a
positive effect for another project, the Chevron-led Caspian Pipeline Consortium
(CPC) -- operating the pipeline running from the Chevron-led Tengiz field in
Kazakhstan to the Black Sea.
The CPC partners - Kazakstan and Chevron - have been asking for Russia's
permission to double the size of CPC capacity. "Russia has blocked that
pipeline's capacity expansion until the Bosporus pipeline is agreed because
otherwise that oil from the Caspian would be competing with Russian oil trying
to get out of the Bosporus," Chris Weafer, chief strategist at Moscow's
Alfa Bank told New Europe. Speaking telephonically from Washington DC, he said,
"Russia has been telling Chevron: 'If you want permission for the doubling
of the pipeline you have to lean on the US State Department to put pressure on
Greece and Bulgaria to agree on the pipeline.'"
Washington, which backed a competing Trans-Balkan pipeline -- the Burgas-Vlore
oil pipeline project - has eased its reservations about Bourgas-Alexandroupolis,
realising that a bypass of the crowded Bosporus Straits, where tankers sometimes
have to wait inline for 10 days, was long overdue.
Just a few days before Russia, Greece and Bulgaria signed the agreement for the
construction of the Bourgas-Alexandroupolis pipeline, US Deputy Secretary of
State Matt Bryza, who visited Turkey and Greece, said Greece and Bulgaria are
US' allies in NATO and American companies are interested in the pipeline, so
Washington does not oppose the pipeline.
Asked if American companies would participate in constructing the Bulgarian
portion of the pipeline, the Bulgarian development minister told journalists in
Athens it would be decided by the time construction is set to begin. He noted,
however, that transit fees would be collected by Bulgaria.
Meanwhile, Bryza has urged diversity and multiple means of transport of
hydrocarbons. The US opposes Russia's proposal to participate in the
Turkish-Greek-Italian pipeline deal, which will transport natural gas from the
Caspian region and the Middle East to Europe. Putin's visit to Greece followed
his trip to Italy where Russian gas giant Gazprom and Italy's ENI finalised the
details of a major gas deal.
Politicians, company executives and analysts alike believe the
Bourgas-Alexandroupolis pipeline is ready to move forward. Transneft CEO Semyon
Vainshtok told journalists in Athens that Russia, Greece and Bulgaria will form
an international company and register its head office. According to the
intergovernmental agreement, the international company will be registered in a
European Union member state. A tender will then be held to conduct a survey and
a feasibility study, and construction will start after it has been completed.
This will all be done "within a very short time, in less than a year or
two," Vainshtok said. Asked if everything will go well, Vainshtok said he
is certain since Russian oil will be flowing through the pipeline.
Commenting on the agreement, Alfa Bank's Weafer said: "Everybody believes
it's a done deal. In terms of the political decision to do it, I don't see any
further obstacles. It looks like all parties have finally agreed ... Even the US
now wants it done."
Greece to expand cooperation with Bulgaria
Greek Parliament Speaker Anna Benaki-Psarouda recently said that Greece will
boost its comprehensive cooperation with Bulgaria, after meeting with her
Bulgarian counterpart Georgi Pirinski in Bulgaria, Sofia News Agency reported.
She added that cooperation would focus on safeguarding regional peace and
stability, boosting trade and promoting personnel exchanges. She hoped that
Greece, Bulgaria and Romania would form a regional axis to implement the policy
of the EU and spread their experience to their neighbouring countries.
OTE launches another exit programme
Hellenic Telecommunications Organisation, the Greek full-service
telecommunications provider, recently announced that it has reached an agreement
with the unions regarding an employee exit program, under which employees who
have one to five remaining years of service, but have nevertheless completed the
minimum requirements for retirement, will get exit bonuses that range from 5,000
to 36,000 Euro in order to depart during 2007, New Europe reported.
Approximately 450 OTE employees are eligible for this employee exit program.
According to a press release OTE said it will ask eligible employees to tender
irrevocable applications during a submission period that will run through March
2007. Departures will start on April 18th, 2007 and all employees participating
in the program will leave the company at the end of 2007. Details regarding the
cost of the programme will be available within the second quarter 2007. It
should be noted that OTE has been implementing similar employee exit programs
with financial incentives since 1996.
A 12.5% stake in AMC may be sold to Cosmote
Greek mobile operator Cosmote's 82.4 per cent-owned subsidiary in Albania is
interested in buying 12.5 per cent stake in AMC, Greek mobile operator at a
reasonable price, AENews reported. Cosmote would buy this stake at a reasonable
price, as Cosmote also owns 97 per cent of Cosmo-Holding Albania, which in turn
controls 85 per cent of AMC. In 2006, AMC had a customer base of about one
million and recorded sales of 151 million Euro.
Tourism-related actions, programmes
Greek Tourism Development Minister Fani Palli-Petralia held a meeting with Prime
Minister Costas Karamanlis on March 1, during which she briefed him on the
ministry's activities in preparation for the 2007 tourist season that is due to
begin in a few days time, ANA reported.
In statements to reporters afterwards, Petralia said the signs for the current
year in tourism appeared to be good.
"At the tourism development ministry we have presented the "tourism
charter" on a regional basis, because we consider that it is the goal and
purpose of every region, every prefecture and every municipality, since it is an
element of economic growth in every area," Petralia underlined.
During the meeting with Karamanlis, the minister also outlined the progress of
an initiative to create 35 kilometres of cycle paths and promenades along the
Athens coast, from the Peace and Friendship Stadium in Faliro up to the seaside
resort of Varkiza, that is gradually beginning.
"Athens, the Attic basin must reach out to the sea and must breathe. This
is an ambitious project that we are planning and in the coming period I will
meet with the mayors of those areas, so that we can have a final study and go
ahead with implementation," she said.
Petralia underlined that her own ministry also had a lot of work ahead in order
to achieve its goal of extending the tourist season, which would be its
programme for the current summer, autumn and upcoming winter seasons.
Promoting Athens as tourist destination
Greek Tourist Development Minister, Fani Palli Petralia, and Athens Mayor,
Nikitas Kaklamanis, held talks on March 5th, focusing on the promotion of Athens
as a self-sufficient tourist destination so that it will not merely be a
stopover for visitors en route to another destination in the country, ANA
To this end, the minister announced a programming contract agreement between the
ministry and the municipality of Athens aimed at city tourism and the
highlighting of Athens as an international tourist destination. In this
framework, the conference on City Breaks will be hosted at the Tae Kwon Do
facility in Faliro between June 11-13. Referring to the programme for reshaping
the coastal zone with the creation of a bicycle and pedestrians road, Petralia
said that this plan is proceeding normally, stressing that with the unified sea
front, the city will be transformed into a coastal one.