Greece finds itself engulfed in a financial crisis that has exposed decades-long tax evasion and a bloated civil service. Businesses have also been saddled with hefty taxes to help pay off not one, but two international bailouts. But as the most successful companies show, there is life after debt.
by Thrasy Petropoulos
As news editor of a weekly newspaper in Greece, I found myself in the plush and manicured offices of the Stavros Niarchos Foundation on the afternoon of June 29. Taking center stage was the acclaimed Italian architect Renzo Piano who, to the sound of classical music, was eloquently and calmly recounting the inspiration behind his plans for the state-of-the-art opera house and national library to be built on what is currently wasteland just north of the port of Piraeus. The 570 million euro project, he explained, is being funded exclusively by the foundation set up by the Niarchos ship-owning family and will be unveiled in 2015.
Around half an hour – and two metro stops – later, I surfaced in central Athens’ Syntagma Square where all hell was breaking loose. Riot police were hurling tear gas grenades at swarms of screaming protesters, who had gathered to let the politicians know what they thought of the latest round of austerity measures being discussed that very moment in parliament only a matter of meters away. That evening, Greece was the leading story on most news programs around the world. Two very different images, both very much part of Greece – and a perfect example of the country’s enduring paradox. For the three decades since it joined the then European Economic Community, Greece has often been referred to as a poor country inhabited by rich people. Though the Niarchos family are hardly representative of the wider population (even by ship-owning standards, they constitute the super elite), there is truth that low basic salaries are often counterbalanced by the amount of cash swirling around the black economy.
The country’s vital statistics make gloomy reading: by the end of the year the projections are for unemployment to have passed 17% and the economy to have shrunk by 3.7%, and the national debt is over 360 billion euros and – most worryingly – is running at more than 150% of GDP. There is, however, another side to the coin. Despite the much publicized violence on the streets and long sequence of public and private sector strikes that have disrupted airport and transport services for more than a year since the country secured the first of two international bailouts, more than four million tourists arrived in Greece up to July. The turbulence across North Africa and recent bombings in Turkey have seemingly played into Greece’s hand. And although tourists are holding on to their wallets more tightly than ever, it is a clear message that the doom and gloom scenarios should be placed at an exaggerated end of the scale. Within the business and commerce community there is justified concern that the tax-heavy austerity measures are suffocating chances of growth. But there is also a recognition that reforms are absolutely necessary and a quiet confidence that the well-run, honest businesses will endure. A survival of the fittest, if you like. Or perhaps: a survival of the leanest.
Published in the hard-copy of Work Style Magazine, Winter 2011