ECONOMY

Athens lures banks from City

athens-lures-banks-from-city

Athens may have never seemed like a potential successor for London’s City after Brexit, but recent development are showing that it could reap some benefits from the expected restructuring in the British financial hub. Sources say that several major investment banks have approached the Greek government to express an interest in opening offices in Athens or in expanding their existing ones as of January, when the deadline for a Brexit deal expires.

This is obviously a welcome development for the economy, with sources saying that the government is to encourage this interest by introducing tax incentives for lenders eyeing a move from the City to Athens.

According to the measures, banks opening offices or expanding their existing ones in Greece during 2021 will enjoy a favorable tax status for about a decade. The details are yet to be determined, but it is certain that one of the conditions will concern the creation of jobs in Greece. The relevant legislation is under preparation and is expected to be submitted for a vote in Parliament next month, so that it can apply as of January.

Government officials in contact with the interested banks explain that Brexit will not automatically lead to the shifting of London’s financial activity to a single city in the eurozone, such as Frankfurt or Paris, as was originally anticipated. Instead, major banks are hoping to expand their presence in more than one cities in the eurozone, and Athens, they say, is one of them.

Sources in the government note that other countries, such as Italy, Portugal and Spain, in which a similar interest is being expressed by City-based banks, have introduced incentives to attract their business. Greece is therefore planning to follow suit very soon.

In the context of Brexit, the Greek government expects other enterprises than just banks to swap a view of the Thames with that of the Acropolis; they will also enjoy the same incentives, according to the plan. This follows the measure encouraging foreign pensioners to relocate to Greece with a flat tax rate of 7%.