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Veranstaltungsberichte

Greece update: The economy after the programs

von Henri Bohnet, Martha Kontodaimon
The discussion was organized in collaboration with the Foundation for Economic and Industrial Research.

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Aiming to analyze the situation after the Greek exit from the financial support programs, KAS Athens in collaboration with IOBE organized an event in Athens. The discussion married the international with the national perspective in two different sessions, where the participants got to hear experts coming from international institutions and national bodies of policy making.

The first session, titled The Greek programs: a European perspective, utilized the expertise of experts coming from European bodies. The discussion opened Chris Allen, DG ECFIN Resident Adviser in Athens of the European Commission, Head of the economic adjustment program. He made a positive evaluation of the Greek case. In specific he pointed out how the financial correction was made early on and was maintained through time, adding on the positive dimensions of the creation of basic institutions and the promotion of privatizations, which help to create a positive mentality and increase trust towards the country. Tobias Piller, Staff Correspondent for the Economy of Italy and Greece of the Frankfurter Allgemeine Zeitung took the floor next. He pointed out how in the beginning of the crisis there was a huge diversion of responsibility among the active players on the reasons of the crisis. "The crisis would have been overcome more faster if there had been a consensus on the origin of the crisis." This affected the ways that the necessary economic reforms were applied and what will that mean for the entrepreneurial powers of Greece. Piller also criticized the bad communication on why the reforms are necessary and what will improve for the citizens of Greece as a result of them. The reforms themselves focused too much on austerity measures only; the urgently necessary reform of the Greek bureaucracy has in many ways been missed. And today's overtaxation of individuals and businesses does not open the path for a fast recovery of the economy. Piller appealed for less state intervention in the market and more economic freedom along the lines of ordoliberal principles.

After a short discussion the second session, titled The view from within: growth after the programs? followed. In this session Greek experts and members of the Parliament discussed the national point of view. The floor took first Franciscos Koutentakis, Head of Parliamentary Budget Office at Hellenic Parliament. He pointed out that the basic economic numbers of the Greek economy show a positive course, but that the challenges which are related to overdue debts, public debt and non-performing loans should be monitored. He expressed his optimism for the Greek economy and pointed out that there needs to be a consensus on the main axes of economic policy and its implementation. Philippos Sachinidis, Former Minister of Finance (2012), followed by pointing out that the governments need to ensure that those affected are supported properly. In specific he noted that "the real concern of society and citizens is whether, ultimately, the Greek economy can enter into a path of convergence with the rest of Europe and ensure that those who are actually affected by the long term crisis receive help". Finally he emphasized on the need of the country to achieve high growth rates in order to move away from the problems created by the crisis. Following, Christos Staikouras, MP of Nea Dimokratia and Former Alternate Minister of Finance, was really skeptical about the current situation. He scrutinized the current situation and pointed out that Greece is the only country coming out of the support programs with the obligation to implement additional measures after the end of the program and strict supervision every three months. He mentioned that the country is struggling to reach its 2014 levels, with the government's overdue debts at the same level as the end of 2014 and the nominal GDP not yet on those levels. Still he ended his statement with a positive note, expressing his hopes for a good result later in the Eurogroup meeting of the day.

During the discussion it became clear that Greece and its policymakers should now put more emphasis on growth and on consistent policies. The bad bureaucracy has to be reformed urgently and the politicians have to regain trust of the voters and of the markets.

The discussion opened Henri Bohnet, Director of Konrad-Adenauer-Stiftung offices in Greece and Cyprus Office and was moderated by Nikos Vettas, Director General of IOBE & Professor in AUEB

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