ECONOMY

Greek business mobility in the Balkans

Businesses that relocated from northern Greece to neighboring Balkan states in recent years are now moving again, not to return home, but to other more favorable regions, usually within the same country, says Giorgos Mylonas, president of the Federation of Industries of Northern Greece (SVVE). What was the reason for an unrestrained drop in industrial activities in northern Greece? There has been a momentum in some sectors that felt compelled to leave Greece. However, those businesses which decided to stay are now strong enough and have undergone changes in their strategy, quality, etc, and I believe they have now escaped the danger of having to leave the country. There has been a stabilizing trend since 2006, but there are still concerns over dropping profitability, which can in turn lead to stagnation and fewer investments, portending unpleasant developments. What do you think has led to a drop in investments in Greece? On the one hand, Greek entrepreneurs are not willing to invest. On the other, those foreign businesses that wish to enter the country, make a study and the first thing they find out is that there is a lot of bureaucracy, creating significant costs in the all-important area of human resources. Another obstacle is certain local government bodies creating disappointing problems for the operation of foreign businesses. Foreign investors are not willing to pay such costs; they prefer, instead, to relocate their business to another country. In recent years, we saw many businesses moving to Balkan states. Is there any way to stop this trend? Currently, there are not enough businesses left to move out of Greece. A number of our members are now relocating, moving from some Balkan regions to others, often within the same state. Certain regions that were regarded as suitable by Greek businesses in which to base their activities, are now becoming dear, owing to higher costs, perplexity and a lack of human resources. This is primarily the reason some businesses are moving from one place to another within the same country. This is already happening in Bulgaria, the Former Yugoslav Republic of Macedonia (FYROM) and Romania. In these countries, many enterprises are moving to areas offering better investment conditions. What do you think are the areas on which the state should focus in order to enhance regional growth? The border region of Thrace is one such area. Incentives offered by the development law are favorable, but this is simply not enough. Businesses are not locating themselves in the region of Thrace because of the absence of basic infrastructure here, and primarily due to a lack in human resources. The local population is of a rural nature, and cannot be absorbed by manufacturing owing to the high level of unskilled labor. Measures should be taken to improve things at all levels of the labor market. Thrace is a sensitive area that should be taken care of. I believe that a moment will come when the EU will see Thrace as a single region, regardless of who is making investments there. In the future, incentives by the EU may be given to enterprises from Bulgaria, Turkey, or others, to invest in Thrace and this might have certain long-term repercussions for Greece. But again, no one in Greece is currently paying attention to that matter.