Chairman of SEV (Hellenic Federation of Enterprises)
Theodore Fessas, Chairman of SEV (Hellenic Federation of Enterprises) has answered Confrontations Europe’s questions on Greece after the signature of the third Memorandum.
How could Greece renew with growth and competitiveness? What is your assessment of the current economic state of play of the country?
Greece has now entered a period of political stability following election results which reaffirmed our commitment to the Eurozone and the EU. The economy demonstrated remarkable resilience in the face of adverse conditions. Even at a time of crippling capital controls, consumer trust remained high, tourism flourished and the growth effect of the last semester proved quite well founded. However, Greece is in bad need of large investments in order to achieve sustainable growth. That’s why we need to send strong and convincing messages to international investors that we want foreign investment and that we are committed to do all that is necessary to achieve this goal. What is needed now, are two things: first, a swift return to economic stability through a successful recapitalization of the Greek banks that will allow us to reclaim the trust of our partners and attract international investments. Second, to proceed without any further delays with all structural reforms, which are half-way completed, in order to reshape the Greek Business environment.
What are Greece’s economic assets and weaknesses?
Arguably, there are significant drawbacks, mainly the fragility of the banking system, especially due to capital controls, the pending management of non-performing loans and of course, the sustainability of the public debt. These issues are on the way to be resolved within the next 6 to 8 months. Certain bureaucratic barriers discourage investors. However, it is the first time, since the outbreak of the crisis, that the vast majority of our political parties avidly support our country’s commitment to the eurozone and the completion of the Program. This is the biggest advantage of the current political and economic environment after what proved to be quite a dramatic year since the Fall of 2014. Greece has a significant investment potential. There are many goods and services markets to be opened, pending privatization schemes, opportunities in the Energy Sector, a great potential to turn into SE Europe’s logistics hub, a well-trained labor force, good practices in PPPs, cultural and natural resources that could promote a sustainable growth model.
What kind of conditions should be created to attract Greek, as well as European private and public investors, back to Greece?
Confidence is the key to recovery. First, financing liquidity should be restored through the recapitalisation of the banks. Investors need access to credit and new financing tools. Second, reforms should focus on a business friendly environment through radical simplification of B2G transactions in every step of the life-cycle of an investment and liberalisation of goods and products services. Third, businesses are highly concerned with the acceleration of the delivery of justice. Fourth, we need to culminate our combat against tax evasion that mainly hurts the organised companies that respect the rule of law and their obligations towards the state.
Where should they be invested in (in which sectors or domains) so that Greece takes all its rank in the European and world division of labor, improve its external balances and, in particular, its exports?
Much of the success of the current program will depend on the performance of companies that export. Hence, medium and large companies should grow, become more productive and competitive in the global economy and new ones should focus on goods and services that embrace knowledge, innovation, sophistication in sectors as tourism, logistics, waste and water management, ICT, agriculture and energy.