BUSINESS

Greek industry continues its dramatic contraction

ANESTIS DOKAS

TAGS: Economy, Business

The sad saga of Greek industrial shutdowns has continued this summer with the compulsory sale of the flagship A.G. Petzetakis plant and the failed tender of Hellenic Steel in Thessaloniki by its Italian owner.

On July 19 National Bank auctioned the central unit of Petzetakis at Thiva, central Greece, at the suggested reserve bid of 15 million euros. The factory which produced plastic tubing was confiscated due to debts totaling 1 million euros, while the property was also used as collateral for 14 loans.

The beginning of the end for Petzetakis came in late 2010, when its financial problems spiraled out of control, although just a few years earlier it had been one of Greece’s few multinationals, while back in the 1960s The Financial Times had dubbed Aristovoulos Petzetakis a “top-class inventor.”

Meanwhile, the Hellenic Steel tender failed to produce a result since the candidate buyer refused to accept the terms for the implementation of environmental projects as approved by the Environment Ministry, which would have cost the investor close to an extra 5 million euros. Notably, Hellenic Steel used to employ between 280 and 300 people.

The country’s rapid deindustrialization led to the closure of more than 20 production units in the period from 2012 to 2017. A number of industrial companies now carry out the orders they receive from foreign firms at their plants outside Greece, especially in countries with low energy costs.

Among the other one-time giants forced to close during the recession was Tsimenta Halkidas, the cement company that ground to a halt in early 2013: Owner AGET Iraklis was forced to cease operations after 87 years due to the dramatic drop in construction in the Attica region, amounting to 80 percent.

The Georgiadis tobacco company also burnt out after failing to tackle its financial problems and survive the competition from the multinationals, even though it used to produce several brands owned by Rothmans.

Construction materials producer Philkeram Johnson has also been history since late 2011, after half a century of operations, while the shutdown of Thrace Paper Mills came as quite a shock too. Other casualties of the recession have been the Nutriart bakery firm (formerly Katselis Sons), the Pepsico-Ivi plant at Loutraki and AGNO Dairy.

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