Since July’s general election, there has been a sense of optimism regarding the country’s course, especially in business circles, inside and outside of Greece. As we learn in the first lessons in economics, “climate is everything.” At the moment, we have a winning combination of trust and euphoria.
But, how long will it last? The government needs a few quick wins to convince skeptics that something is really changing. The prime minister has evidently decided to avoid delivering any major shocks, such as the closure of the overindebted state mining company Larco, or the dismissal of the surplus of fixed-term contract workers in the public sector – and rightly so. He is not just wary of the political cost that the government would incur or of awakening memories of his father Konstantinos Mitsotakis’ administration in the 1990s.
Avoiding extreme moves also deprives the opposition of the narrative it needs to return to its very old self and take to the streets. SYRIZA leader Alexis Tsipras would very much like to see Kyriakos Mitsotakis acting like the staunch neoliberal he accuses him of being, but no such luck.
However, the government still needs some quick positive “shocks.” One such shock would be to finally see bulldozers getting to work on the old airport plot at Elliniko in southern Athens. The government does not need public relations stunts like those of the previous administration, when ministers took photographs inside a stationary metro car in Thessaloniki. It needs real bulldozers that will do the job and continue to do it even when the cameras leave.
Necessary though they are, these shocks will inevitably run up against the Greek state and its notorious ability to torpedo the most beautifully prepared plan in a matter of minutes. All it takes is one official of the state’s Legal Council to be on holiday for long-term plans to get delayed indefinitely.
What we need are ministers who know how to deal with the system and are capable of assuming full responsibility for implementing a project, ensuring it does not run into any snags or unforeseen obstacles. We also need frightened, self-promoting ministers to stand aside and stop weighing the political cost of each decision so meticulously.
The next six months will reveal whether the government is on the right track. Greece is cheap and offers significant yields for investors during lean times. The political risk is essentially non-existent as there are no obvious milestones in the next four years that could cause the government to stumble. With a bit of courage, common sense and maybe a stroke of luck, the great expectations of the last few weeks could be realized.