“Greece will act as a bridge between the Arab world and Europe, but also as a springboard for growth in the broader region, strengthening both the Greek economy and the country’s role in Europe. The first steps in this direction were taken at the first Euro-Arab Summit,” says Tawfic Khoury of the Consolidated Contractors Company, the Middle Eastern construction group responsible for the event in Athens last week.
The summit heard a number of speakers discuss cooperation opportunities on the political and economic level that could boost stability and sustainable development in the region. Even more referred to investment opportunities in real estate, energy, tourism, infrastructure and commerce. There were also signs at the meeting that interest is expanding in many sectors such as food production and shipping, including from new players such as Libya.
However, a series of problems were also highlighted regarding Greek-Arab economic relations, from practical ones such as in financing, to cultural factors. For instance, it is well known by those involved in bilateral talks that upper state echelons dictating agreements between states and licensing procedures is the norm in the Arab world, whereas in Greece, European and domestic legislation demand open tender procedures – which are further complicated by Greek red tape and the crisis.
So, while Arab interest in investments in Greece is significant – particularly in regards to holiday accommodation and tourism development in general – many projects have floundered because the need to submit tenders, a procedure many Arab investors are unfamiliar with. However, when the investments concern private enterprises and negotiations are conducted directly between the chiefs of each side, reaching a deal is far easier. This is illustrated by the participation of Arab groups in Greek listed energy firms.
Several negative experiences of Arab funds that failed to get a foothold in Greece were also discussed on the sidelines of the event. However, that good news is that Greece was able to host the meeting having completed the sale of Astir Palace Resort to a consortium including two Arab state funds and several private interests from the Arab world, as well as the agreement for the development of the Elliniko plot, where Arab capital is also involved.