ECONOMY

SEV wants national plan, speedier structural reforms

The Federation of Greek Industries (SEV) yesterday reiterated calls to the government to speed up structural reforms needed to improve competitiveness and also warned of the dangers of a populist approach geared to forthcoming municipal elections. Addressing the federation’s annual meeting, SEV head Odysseas Kyriakopoulos said the government’s top priority should be to boost competitiveness, which is essential to economic growth and job creation. He pointed to Greece’s declining competitiveness as evidenced in last year’s «disappointing exports.» «This unfortunately mirrors the country’s low competitiveness,» he said. With Greece now fully exposed to global competition following its entry into the eurozone, it is imperative that the State focuses on measures to improve competitiveness, he said. Despite a spate of suggestions by both international and local bodies, the State has failed to take action and has even dragged its feet on the issues. «We don’t have the luxury of time,» Kyriakopoulos said. He added there is general agreement on the need for radical reforms but politicians seem to be driven by political and electoral expediency sparked by forthcoming municipal elections. The result was that structural reforms are not being implemented fast enough. He said one prime example of the lack of decisive and far-reaching action is the current debate on social security reforms. While «brave reforms» are needed, what the State has come up with is a solution that will only serve to increase the system’s actuarial deficit and with little attention paid to the actual costs that will be borne by taxpayers, he said.There is also the question of funding, which is based on the premise that the State will keep its word.Kyriakopoulos also criticized the lack of state support for the private sector despite its contribution to national growth. He questioned the country’s future after the 2004 Olympic Games and community funds dry up in 2006. «Foreign direct investments could be an answer,» he said. Attracting foreign investors, however, could be a problem due to Greece’s negative image and corruption, complex tax system and black economy. He said problems such as these are why Greece is the last country of investment for foreign investors and why foreign direct investments amount to just 1 percent of gross domestic product. Kyriakopoulos’s concerns mirrored those expressed by the former head of the state-owned investment center, who was sacked earlier this month after issuing a report critical of the barriers to foreign investments in Greece. The SEV head proposed the adoption of a national growth strategy independent of short-term electoral expediency and targeted towards attracting foreign investments and improving competitiveness.