Banking on the Balkans

In the two decades since the fall of the Berlin Wall, Greece has managed to miss every opportunity to establish itself as the major economic and political player in Southeast Europe. Our politicians have allowed domestic concerns to dictate foreign policy without establishing a long-term strategy or showing any ability to adapt to the changing political and economic climate. As the years passed and as our neighbors worked their way out of the dead ends and poverty of the communist era, Greece was embroiled in bilateral problems with almost all of them, wasting political capital instead of creating more productive ties. At a time when turmoil in the Balkans demanded strong leadership and initiatives, Greece displayed none of the self-confidence one would expect of a longtime member of the European Union and NATO. Athens did show the odd initiative – such as hosting a peace conference during the Yugoslav conflict and providing funds for Balkan reconstruction. And it is also fair to say that most of the problems were not of Greece’s making – such as Greek minority rights in Albania, the «Macedonia» name issue, and Turkey’s occupation of northern Cyprus and its pressure on Greece in the Aegean. What was lacking was the inspiration to look beyond political problems and build bridges in what has always been a fertile hinterland for economic growth and political influence. And yet, Greece’s relations with its neighbors were nominally good, thanks mainly to business initiatives and investments. If our politicians had focused on encouraging strong social, cultural and sporting ties, they would have formed the backbone of improved relations with our neighbors. Instead, even when immigrants from Albania, Bulgaria, Romania, Moldova and other countries came here in good spirit, wishing to build a better life, they were left to the whims of indifferent bureaucrats and malevolent police. This did nothing to foster good relations with countries that should have been overjoyed by the remittances they were receiving from Greece, prompting them to stand by Athens diplomatically. Instead, it was left to individual citizens and businesses to improve ties. Now, the fallout from the global economic crisis on the Balkans and Southeastern Europe can offer Greece a new opportunity to emerge from its shell. Its major banks are deeply involved in the Balkans. This inspires fears of overexposure but also provides an opportunity for Greece to play a constructive role in helping weather the storm and prepare the future (for example, 30 percent of National Bank of Greece’s loans are outside Greece, with 16 percent of them in Turkey). As the region suffers from its worst crisis since the collapse of communism – with remittances, manufacturing and exports plummeting – there are fears for the area’s security. In Strasbourg last week, US President Barack Obama said he was «very concerned about the impact of the economic downturn» on Balkan countries’ ability to maintain peace and stability. According to the Financial Times on Monday, an IMF report proposes that EU states in Central and Eastern Europe should consider scrapping their currencies in favor of the euro even without formally joining the eurozone. Greece most certainly has its own economic and social demons to confront. But, as a member of the eurozone, it enjoys security that no other country in the region has. With its extrovert banks and other businesses primed and ready, all it needs is strategic planning and political initiatives to open up the Balkans and give the Greek economy room to expand, and in doing so spur growth both in Greece and the region. This opportunity must not go to waste.

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