ECONOMY

New orientations for bolstering Greek economic development

The Greek economy is in a transitional phase as a development cycle is closing and a new one needs to open immediately, so that the country consolidates its position on the European economic map and survives growing international competition. Until 2000, the target that served as an engine and point of reference was Greece’s entry to the eurozone. By 2004 this aim was fulfilled by the completion of big projects and the staging of the Olympic Games. So now, what’s next? What are the objectives to serve as an engine and pull the Greek economy by 2008 or 2012? Here’s an answer: Increase GNP by 50 percent in the next 8-10 years and expand the internal consumer market by 2 or 3 million people. This may sound too theoretical or even impossible if not frivolous, but it is not. It can materialize with sufficient strategic planning at the national level and if the government mobilizes Greek and foreign capital for significant investments (it promised before the election to increase development 5 percent per year). How can this happen, then? Economic analysts point to several ideas that can serve as the basis of a new orientation for the Greek economy. The first one centers on «permanent» high tourism, exploitation of the mild climate and the thousands of miles of beaches in Greece. With the appropriate infrastructure and property prices settling at reasonable levels (as prices have shot up in the hands of local small contractors), many wealthy Europeans are expected to invest in the warm and beautiful Greek land over the next few years for a holiday home and stay of several months. A recent survey by a distinguished Greek economist abroad estimated that the aging of Northern Europeans will bring about considerable population shifts toward warmer EU regions, with a direct impact on investment, consumption and revenue. Within the next 10 years it is estimated that at least 85 million Northern Europeans will be over 65 years old. If the wealthiest of these follow the American model, it is reasonable that as many as 2 or 3 million may wish to buy property and stay semipermanently in Greece, if they can. The development of high-quality universities (new ones, with a different mentality and function), making Greece Southeastern Europe’s center for studies, would also result in population shifts for younger people, producing higher demand and revenue in the long term. This government has made many promises on education and the era of the «knowledge economy» has already begun, offering the chance for a new start, without inhibitions, to attract significant investments of capital and human scientific resources. Regarding education and property and tourism, Greece needs to capitalize on the good publicity it has enjoyed abroad since the success of the Olympics. Sydney’s example, with thousands of students added every year after the 2000 Games, is characteristic. Who can doubt that Greece, with the appropriate preparation, could develop into the main destination in Southeastern Europe for studies abroad? If India can invest in health the way London has done, as The Economist recently wrote, why couldn’t Greece invest in something that will increase its inflow of foreign currency and its domestic income?