It’s been over eight years since the first bailout loan kick-started the Greek economy and there’s a growing sense of optimism amongst the public and private sectors in Athens
‘I feel that Greece will be in a position to exit the austerity agreement sooner than the agreed summer of 2018,’ says Constantine Michalos, and he should be in a position to know. As president of the Athens Chamber of Commerce and Industry, Michalos represents over 100,000 member businesses in Greece.
The largest business organization in the country, the ACCI can even lay claim to being established longer than both the London Chamber (1881) and the Association of German Chambers (1872).
Rather than a political agenda to promote, Mr. Michalos has the interests of the Chamber to consider. With the numerical weight of such membership, however, a stable political landscape makes for happy businesses. In this respect, he knows precisely what the Greek Prime Minister needs to do in order to build on the existing steady, and sustainable growth.
The ACCI president may well be optimistic about the country’s growth potential but isn’t naïve enough to think it will come pain-free. ‘As could be seen by this year’s budget, Greece has committed itself to the application, or the implementation, of specific measures and reforms, even after the summer of 2018,’ he says.
The Chamber also believes that this is going to be a continuous battle as far as the economy is concerned. To make this continuing self-imposed austerity work, it’s clear that the government will have to back up their grand words with a policy for encouraging investment and enhancing entrepreneurship.
‘These prime ministerial hopes are all very well,’ cautions Mr. Michalos, ‘but they need to be turned into actions, and we’re awaiting these actions as soon as possible.’
The Chamber’s action plan consists of a number of priorities which they feel need to be implemented sooner, rather than later. These actions believe the ACCI, are required to create a level playing field regarding competitiveness.
‘First of all, the business tax levels are extremely high,’ states Mr. Michalos, ‘If one looks at the list of the OECD countries, Greece is one of the lowest ranking countries as far as competitiveness is concerned, as a result of the high levels of taxation.’
At the opposite end of the spectrum, National Insurance contributions for Greek employers are the highest in the European Union. Add to this, the businesses that pay as much as 40% of their total production costs in energy and fuel taxation and you create a perfect storm of anti-competitiveness. These, say the ACCI need cutting dramatically.
Taxation aside, the ACCI is keeping a close watch on two governmental pledges in particular that are very close to their heart; entrepreneurship and investment.
These two factors are of course, necessary for both existing business and new growth. Keen to play their part in the country’s regeneration, the Athens Chamber of Commerce and Industry has been running an incubator project over the last two and a half years.
‘The scheme started off with approximately 450 applicants, and we managed to shortlist these down to 50 businesses’ says Mr. Michalos. ‘Out of which we can say that seven have already been taken up by local and foreign business concerns, and we’ve succeeded in securing financing for at least 15 of the remaining companies, with high hopes for the rest.’
The ACCI boasts an excellent relationship with all the major Chambers of Commerce and Industry within the European Union and was the first to introduce one of their initiatives (the Business Angel scheme) to Greece.
‘For the time that we have been running this idea, we’ve had quite substantial results,’ says Mr. Michalos Proudly. ‘I hope that by the end of the year we will also be able to see the first of our Business Angel Awards, which will showcase the successful start-ups and the businessmen who have been mentoring them. ‘
As for the second item on the ACCI’s watch list, the president has some very positive words for potential investors. ‘Doubts on Greece leaving the Eurozone have all been cleared, the completion of the second review has been concluded, and with the banking system on a different footing than it was a year ago, this is a stable country.’
He is, however, honest in his appraisal of the country’s stumbling blocks when it comes to attracting inbound investment. ‘The message is very clear and very honest,’ he admits, there are still bureaucratic problems regarding red tape, and of course tax issues, both of which the government has now undertaken to simplify and reform in the coming months.’
‘As the most southerly entry point of the European Union, Greece is in an enviable geostrategic position,’ concludes President Michalos. ‘We are a major investor in the Balkans, have created investment access to Cyprus, Israel, and Egypt in regards to the energy sector and have attracted heavy investment from China.
‘What we have learned over the years, however, is that while these things need patience, you also need a government that demonstrates a commitment to perform all the necessary structural reforms. Do this, and you provide the right climate for the foreign investor.’