ECONOMY

Defense sector needs urgent overhaul

Greece’s defense companies are in urgent need of restructuring in order to secure long-term growth and meet intense global competition, according to study results made public yesterday. The Foundation for Economic and Industrial Research (IOBE), a nonprofit research group, said in the study that the sector needs to become more competitive and expand abroad to survive due to its relatively small size. «A big weakness of the Greek defense industry is its limited technical know-how,» IOBE said in a statement. The Greek government spent 0.5 percent of its total research and development budget on the defense sector in 2006, or 0.016 percent of gross domestic product. Participation in international research projects is also «exceptionally limited,» added IOBE. Among the proposals the research group put forth is the need to take part in more development programs, promote itself abroad and take advantage of the globalized market by boosting exports. «High dependence on the Greek state has made things worse for the sector, given that armament programs have been limited,» it said. Greece’s defense sector includes companies from the private and public sectors, such as the Hellenic Vehicles Industry (ELVO), Hellenic Shipyards and Intracom SA defense systems.