NEWS

Aiming for exports and investments

Economy and Finance Minister Giorgos Alogoskoufis has a vision of Greece becoming «the Ireland of the South,» a dynamic economy attracting considerable foreign investment, as well as a pole of attraction for northern European retirees, like southern Spain has become or Florida, for the Americans. In an interview published in the Sunday edition of Greek Kathimerini, Alogoskoufis admits that this is a very ambitious goal, given the present state of the economy. Public finances are «in a bad state,» he admits, and the so-called auditing of public finances is not over yet. A restatement of defense expenditures, which would essentially bring forward payments that the previous government had projected to coincide with the actual delivery of defense systems, a few years down the road, will increase the budget deficit to over 4 percent of the country’s gross domestic product (GDP) for both 2003 and 2004. Alogoskoufis adds that the deficit will most likely get under the 3 percent limit prescribed by the EU in 2006. The private sector is also a cause for concern, given its dependence on the state. «If we exempt shipping and some export-oriented industries, most other businesspeople and sectors depend on the state, have claims on the state, demanding funds or seeking special treatment,» Alogoskoufis says. The Greek economy’s main challenge is to become more open to the outside world, to boost its meager exports and convince foreign investors it is worth bringing their capital in. Alogoskoufis would like to see bodies such as National Tourism Organization, the Export Promotion Organization and the Hellenic Center for Investment cooperate closely. The state’s role is to facilitate the creation of a favorable business environment. Alogoskoufis refers to the upcoming bills reducing taxes and providing capital repatriation and investment incentives. A second round of «difficult» privatizations will be undertaken, including infrastructure such as ports and airports, energy production and distribution networks, as well as the leasing of state land, to which his party had vehemently objected when in opposition.