ECONOMY

Entrepreneurial and desperate

An increasing number of young people are turning to running their own business or being self-employed, as a result of the nightmare called unemployment and an uncertain future. The so-called «-700 generation» (named after the basic wage), is facing a number of problems, the most persistent ones including bureaucracy and high costs for new business registration. The cost of setting up a business is even higher than the country’s annual per capita income. And if one wishes to start a venture such as a warehouse, the minimum time required is over 240 days. The moral is that anyone wishing to try their luck in business should equip themselves with plenty of patience, tolerance and endurance. Every year, 4,000 new businesses are registered in Greece, and one in 10 young people is considering setting up his or her own business in the next three years. However, 20 percent of these do so out of necessity, not necessarily because they have the aptitude. Bribes Payments made under the table by a company to get a job done, or even to speed up procedures, has been estimated to account for 0.23 percent of a business’s turnover. On an annual basis, this comes to some -330 million, according to data included in a World Bank report titled «Doing Business 2008.» As much as 55.91 percent of businesses believe that they have to pay bribes to tax inspectors. The respective survey asked 546 firms for their opinion on the issue. The value of the bribe a business must pay in order to win a contract with the state is equal to 0.79 percent of the contract’s value. In addition, businesses said they declare only 89.24 percent of their turnover, which translates into tax evasion of nearly -17 billion annually. The World Bank report found that transparency indices for the Greek economy have not recorded any improvement in recent years. What’s even more striking is a World Bank estimate that the «bribe industry» in Greece amounts to -400 billion per year, and mainly regards the relationship between businesses and the state. According to another estimate, black economy activities in total account for 28.6 percent of the country’s GDP, or -68 billion. The World Bank report also presented some actual cases from Greek reality, such as a businessman’s wait of 90 days to get clearance for the use of warehouse premises, plus a further 45 days to get his business connected to power and other public utilities.