The Federation of Greek Industries (SEV) yesterday expressed concern as to whether Greece can continue to sustain its current high level of growth once the EU expands to include 10 new members in 2004. Not only will Greece lose out on EU structural funds, it is also likely to face strong competition from countries with a better competitive edge and saddled with fewer problems, Odysseas Kyriakopoulos, president of SEV, warned. «The enlargement process will bring about new realignments,» he told participants at the federation’s annual meeting last night. Foremost will be the channeling of funds to the new members, mostly former communist countries in Eastern Europe, which will mean less for the older members, Kyriakopoulos predicted. He said expected changes to the Common Agricultural Policy will see reduced funds coming Greece’s way to the disadvantage of its farmers. The inflow of structural funds is also due to taper off. The competitive threat from the new members is another equally important concern. «It is particularly worrying that a number of these countries precede Greece in global economic competitiveness studies, have significantly lower public debt and labor costs, have better education, and are closer to the major European markets,» Kyriakopoulos said. He said the combination of reduced EU funds and competitive threat from new members «fuels worries as to whether the current high growth rate can be sustained after 2006.» The SEV head urged long-term measures to tackle high public debt and corruption, improve competitiveness and maintain strong growth. «We recognize significant progress has been made but the pace is too slow and uncertain,» he said, citing the shortcomings of last year’s labor law reforms and recent setbacks over the sale of equity stakes in oil refiner Hellenic Petroleum and gas utility DEPA. Seeking to defuse fears that growth could ground to a halt after 2004, Prime Minister Costas Simitis said in a speech read in his absence that the post-Olympic Games era is expected to be even better than the current period. He said investments underpinning Olympic Games projects will be redirected to regional development after 2004, while the tourist industry, which accounted for 7 percent of GDP last year, should flourish due to greater awareness of Greece resulting from the sports event. «The post-2004 period will be a better period than now,» he forecast. Simitis also urged businesses to take steps to enhance their competitiveness and not depend solely on the State. He said that they should focus on quality, monitor market developments and invest in new technology. Economy and Finance Minister Nikos Christodoulakis said the development law, due to be voted on in Parliament by end-June and scheduled to be implemented in September, will aim to speed up regional growth. The law will offer more subsidies to local companies and improve incentives to attract direct foreign investment.