GREECE
A NEWS REVIEW FROM THE EMBASSY OF GREECE IN WASHINGTON DC
PRESS & COMMUNICATIONS OFFICE
February 2005; Vol. 11 No. 2
(also available in PDF File)

1. EUROPE AND U.S. UNITED ON BASIC PRINCIPLES
2. KAROLOS PAPOULIAS ELECTED PRESIDENT OF THE HELLENIC REPUBLIC
3. IMF REPORTS ON THE GREEK ECONOMY
4. GREECE: EARLY RATIFICATION OF EU CONSTITUTION
5. CHURCH OF GREECE PLEDGES “SELF-CATHARSIS”
6. GREECE SEEKS MORE AMERICAN TOURISTS

Prime Minister Karamanlis at NATO and E.U.-U.S. Summits
EUROPE AND U.S. UNITED ON BASIC PRINCIPLES

At a press conference after summit meetings of NATO and EU leaders with President George W. Bush, on February 22 in Brussels, Prime Minister Costas Karamanlis spoke of the summits as an important step in re-establishing mutual understanding between Europe and the United States. Both have realized, Mr. Karamanlis said, that there is more that unites rather than divides them. The summits took place during the first visit by the American president to Europe following his re-election in November.
“There have been and continue to be disagreements on tactics, but in essence there is unity on basic principles; and that is a strong foundation for further cooperation. The fight against terrorism and establishing security worldwide,” the prime minister added, “require mutual support.”
Summarizing the discussions at the summits, Mr. Karamanlis said that the NATO leaders had considered the reinforcement of democracy, security and development in Afghanistan where, he noted, in addition to a 126-man engineering unit deployed by Greece for the past several years, a 30-bed medical unit will be sent on an 18-month mission.
The meeting also discussed the situation in Iraq where Greece is contributing by helping to finance the training of Iraqi security forces. Foreign Minister Petros Molyviatis had earlier announced that Greece would offer !300,000 to a special fund set up for this purpose.

Focus on the Balkans
In his remarks during the EU-US summit, Mr. Karamanlis referred to the Balkans as a region that demands closer cooperation between the EU and the US. The EU, Mr. Karamanlis added, is the “driving force behind the emergence of reformist and democratic leaders and the replacement of autocratic leaders and regimes.”
“EU standards and principles,” he continued, “have gradually replaced antiquated political and economic systems with democratic societies open to all citizens, regardless of national origin or religious affiliation. The problems of the region, related to organized crime and poor infrastructure—often the result of war and poor management—demand our undivided attention.”
Mr. Karamanlis referred also to the pressing problem of unemployment in the western Balkan countries as a problem which must be addressed as a top priority in view of its deep social impact.
On the issue of Kosovo, the prime minister added: “We all realize that the situation in the region is temporary. Our efforts concern the next stage, during which an evaluation of standards will be made. We cannot return to conditions that prevailed before 1999, nor will we tolerate a situation that could lead once again to de-stabilization.” He also spoke of the need for respect of the region’s multi-ethnic character, religious freedoms, minority rights, and the protection of property and monuments.
During contacts with his colleagues, Mr. Karamanlis confirmed a program of overseas visits “to cement close ties with natural partners and allies.” Countries on the schedule include Luxembourg, Germany and France, with the United Kingdom and the United States later in the year. Foreign Minister Petros Molyviatis is scheduled to visit Washington on March 24 for talks with Secretary of State Condoleezza Rice.

KAROLOS PAPOULIAS ELECTED PRESIDENT OF THE HELLENIC REPUBLIC

The government’s nomination of Karolos Papoulias, a former senior statesman of the opposition PASOK party, to succeed Kostis Stephanopoulos as President of the Hellenic Republic, resulted in the election of Mr. Papoulias by a record majority of the Greek Parliament.
With both the governing New Democracy party and the PASOK main opposition party voting for him, Mr. Papoulias was elected on February 8 with 279 of the 296 votes cast in the 300-seat Parliament. Mr. Papoulias, 75, who assumes the presidency for a five-year term on March 12, will be the sixth to occupy that office since the restoration of democracy following the fall of the seven-year military dictatorship in 1974.
Mr. Papoulias, expressing his “sincere gratitude for the great honor,” said the vote accorded with the constitutional requirement for consensus in electing the president. “I believe,” he said, “that consensus is an achievement for our political culture and a demand of Greek society on all important issues that concern our country.”
Prime Minister Karamanlis stressed that the political career of Mr. Papoulias was characterized by “conscientiousness and consensus.” He added: “Our choice meets the challenges of our times . . . it stems from our unwavering decision to put an end to the divisions of the past.”
Main opposition PASOK leader George Papandreou said the election marked an important day in the institution’s history. Mr. Papoulias’ experience, personality and character, Mr. Papandreou noted, guarantee that he will be a worthy successor of outgoing President Kostis Stephanopoulos.

Strong Growth Praised but Fiscal Consolidation Urged
IMF REPORTS ON THE GREEK ECONOMY

After concluding its annual consultation in Greece on the state of the Greek economy, the International Monetary Fund issued on February 2 its report, stating: “The several years of strong economic growth continued in 2004, buoyed by supportive monetary conditions, an expansive fiscal stance, and the Athens Olympics. Rising incomes and a falling, though still high, unemployment rate underpinned strong household consumption, while increased profitability spurred investment spending, especially construction.”
On a less positive note, the report noted the persistence of “long-standing structural impediments” such as inflation above the euro-area average, eroding international competitiveness, and smaller export market shares. This has resulted in large current account deficits and a negative contribution of the external sector to aggregate demand.
There was particular concern over the deterioration of the fiscal situation, following the “very large data revisions” of figures provided by the previous government for fiscal deficits in the period 1997-2003. The general government deficit is expected to have reached at least 5.5 percent of GDP in 2004, and the government is aiming at “significant fiscal consolidation” in 2005. The end of Olympics spending, the report pointed out, is important as a permanent factor in a 1.25% improvement.

Welcome for Efforts to Improve Fiscal Reporting
The report noted with approval the efforts of the Greek authorities, working with Eurostat, to improve fiscal reporting and to adopt many other data-review reforms which, “are essential to preserve the government’s credibility and the confidence of investors, which in turn are essential for long-term growth.”
The IMF further noted that the planned fiscal adjustment “will require restraint, prioritization, and strengthened expenditure management.” It pointed especially to the possible limitation of the public sector wage bill, stronger control of health care spending, and a review of defense outlays.
Another concern noted in the report is the “long-term threat” posed by an ageing population, requiring a more immediate response by the government to the need for pension reform. Faster progress was also recommended on reforming the labor market by easing strict employment protection measures, extending part-time and temporary employment opportunities, improving education and training, and “ensuring that wage settlements are in line with productivity and euro-area inflation objectives.”
The IMF had praise for the government’s plans to improve the business climate by tax simplification and further privatizations.
• On February 9, the EU Council of Economy and Finance Ministers urged Greece to adhere strictly to its 2005 budget by which, it said, the country’s fiscal deficit, at current growth rates, could fall to 3.6% of GDP in 2005 and below 3% in 2006. And in Athens, Finance Minister George Alogoskoufis said that the EU’s recommendations were fully compatible with the government’s strategy for eliminating the excessive fiscal deficit by the end of 2006. In this effort—to be pursued by “mild” measures—“we are seeking the greatest possible level of understanding and consensus with everyone: the public, social groups, political parties, and our partners in the EU.”

PM Karamanlis: Greece as “Economic Hub” of the Region
Reported in a special edition of the Economist devoted to the “Irish miracle,” Prime Minister Costas Karamanlis expressed confidence in the ability of Greece also to succeed in its bid for growth and prosperity. The government’s goal, he said, is none other than to transform the country into a modern economic hub of the entire region—a Balkan or even Mediterranean economic “tiger” as the countries of the Asia-Pacific rim, with their supercharged economies, are often referred to.
Greece, Mr. Karamanlis said, can follow Ireland’s example, especially in the attraction of direct foreign investment and hi-tech multi-national contribution to the economy. A policy of immediate market deregulation, especially in the energy sector, should provide a jumpstart for investment. There will be other helpful reforms to attract foreign investment, he said, in the legal and institutional framework governing business investment. Also, in line with the Irish model, the government will go ahead with the creation of “innovative cities” outside the congested and economically saturated Athens area.
This vision of Greece as the economic hub of its region, and even the Mediterranean area as a whole, was echoed in remarks by Foreign Minister Petros Molyviatis, who opened a ministerial conference in Athens on business and development of the Mediterranean Basin, attended by representatives of 17 countries.

Black Sea Economic Cooperation
Greece’s important role in the economic development of its broader region, especially in light of its current presidency of the 12 member-country Black Sea Economic Cooperation Organization (BSEC), was also discussed by Deputy Foreign Minister Evripidis Stylianidis, at a meeting at the State Department in Washington on February 18 with Eurasia senior advisor Steven Mann. BSEC activities, Mr. Stylianidis said, are increasing in importance as its member-countries were directly involved in the supply of energy resources to western markets.
Meeting in Athens on February 21, interior and justice ministers of the BSEC countries signed a joint agreement to deal with bureaucracy and corruption. They agreed also to create a permanent working committee to promote good governance. More meetings of business people and government officials are planned during the rest of Greece’s six-month presidency, which ends on April 30.

GREECE: EARLY RATIFICATION OF EU CONSTITUTION

The ratification of the European Constitutional Treaty, signed by the 25 EU heads of state and governments in Rome on October 29, 2004, was discussed at a meeting of the Cabinet on February 15. It will be submitted in March for consideration by the Greek Parliament, where a committee consisting of 70 members of all its political parties will consider the treaty in several sessions before a debate in the full house.
Following the Cabinet discussion, Foreign Minister Petros Molyviatis spoke of the Constitution as a very important step towards the unification of Europe, pointing out at the same time that, like all EU affairs, the draft was the product of a compromise “in accordance with the democratic operation of Europe.”
Addressing a European studies conference in Athens, Deputy Foreign Minister Yiannis Valinakis spoke of the government’s decision to be among the first of the EU countries to ratify the European Constitution. Greece, he said, must be “at the heart of European developments . . .We have the political will, the determination to place Greece among the protagonists of Europe.”
Ratification of the Constitution, whether by parliaments or by referenda, must be completed in the 25 member states before November 1st, 2006. The Constitution formally establishes the European Union as a single legal entity while providing for a clearer and more powerful external voice. It also simplifies EU law, clarifies Union and national policy jurisdictions, and makes the EU’s institutions more transparent and democratic as it formally enshrines the fundamental rights of its citizens.
In a recent Eurobarometer survey of public opinion regarding the European Constitution, Greeks were among the citizens of the top three member-states  that expressed the greatest trust in the European Union.

Greece to Assist Turkey Achieve EU Standards
The efforts of Turkey to meet the requirements for EU membership were discussed on a visit to Ankara by Justice Minister Anastassios Papaligouras, who described it as an opportunity “to stress the need for decisive steps and brave measures to achieve harmonization between Turkish and European law.” Mr. Papaligouras noted that “the legal framework of a country directly reflects its political culture, its historic origins and its social relations. Changing legislation means, to a great extent, reforming society.”
The minister said that he had discussed with Turkish officials the ways in which Greece could assist Turkey in adapting its laws to European patterns, for instance by providing consultants and training courses in Greece’s National School of Judges and the use of the Athens-based European Center of Public Law, so as to facilitate the necessary institutional changes in Turkey’s laws.
Mr. Papaligouras also offered the view that helping Turkey to adapt to the requirements of EU law would assist the improvement of Greek-Turkish relations. “A democratic Turkey,” he said, “governed by the rule of law and an institutional framework that protects the free expression of ideas and differences, will in essence be a European Turkey that will not elicit negative reactions from European public opinion.”
In opening the third conference of Greek and Turkish journalists on February 19 in Athens, Minister of State and government spokesman Theodoros Roussopoulos spoke of the recent improvement in Greek-Turkish relations. The EU’s decision to give Turkey a date for the beginning of accession negotiations is “both a practical and symbolic ratification of Turkey’s European prospects that open up a new era.” In the long and difficult road ahead, he added, “Greece and Turkey will have to speed up the process of overcoming deeply rooted prejudices and stereotypes of the past.”

European Concern for Environmental Protection
European Commissioner for the Environment Stavros Dimas joined other European Union officials on February 16 in Brussels to welcome the entry into force of the Kyoto Protocol as “the first step” towards reducing greenhouse gas emissions and dealing with the urgent problem of climate change. Mr. Dimas noted that temperatures had increased in Europe by one degree centigrade over the past century, but he expressed confidence that Europe will meet the target of reducing greenhouse gas emissions by 8 percent from the 1990 level.
Commissioner Dimas also emphasized the need for increased international cooperation on the issue of climate change. He said the EU, the United States, Russia, China and India combined currently produce 75 percent of the world’s greenhouse gases.
The entry into force of the Kyoto Treaty was welcomed by Prime Minister Costas Karamanlis who said it was a confirmation of international concern for environmental protection. “Greece,” the prime minister noted, “is an active participant in this initiative believing that awareness and action on issues related to environmental protection are not just an element of modern civilization but also a determining factor of its quality.”

CHURCH OF GREECE PLEDGES “SELF-CATHARSIS”

The synod of the Church of Greece, a body including all the metropolitans and bishops of the Greek Orthodox Church, met for two days, February 18-19, to investigate complaints of corruption against high-ranking members of the clergy. The meeting decided to set up a fact-finding committee headed by Archbishop Christodoulos of Athens and All Greece, and including members of the Supreme Court and other judicial bodies. The Archbishop proposed a series of reforms for “self-catharsis” in the church.
Prime Minister Costas Karamanlis said on February 8 that his government will applaud every effort by the church to set its house in order and he reiterated his pledge for “transparency everywhere; zero tolerance for vested interests and corruption.”
Main opposition leader George Papandreou said that the central problem is not with the individuals concerned but with the protection of the Church as an institution. He proposed the holding of a referendum on the separation of Church and State.

GREECE SEEKS MORE AMERICAN TOURISTS

An important part of its overall strategy to develop a superior-class tourist industry is Greece’s focus on attracting more visitors from the United States, now at only two percent of the tourist flow to Greece. That was the subject of a two-day meeting in Athens, February 18-19, attended by American tour operators and Greek tourism businesses and agencies.
Opening the meeting, Minister for Tourist Development  Dimitris Avramopoulos said that the United States is “a high priority country” in Greece’s tourism-development program—especially in the context of Greece’s new strategy in that area. Mr. Avramopoulos spoke of the strong and lasting bonds between the two countries and of “the deep and sincere feelings of the Greek people for the American people which should never be in doubt.”
Pointing to Greece’s success in holding the Olympic Games in complete security at a time of widespread international concern for terrorism, Mr. Avramopoulos said: “We are well aware of the importance to travelers of the word ‘safety.’ It goes together, however, with a hospitable atmosphere which comes from the very character and lifestyle of the Greek people.”
“We are all citizens of the world, above all else,” Mr. Avramopoulos continued, “we do not see ourselves as being in competition with our neighbors. On the contrary, we wish them well, for in that way we can each contribute to the overall effort and at the same time develop a wider zone of high tourist interest.”
In early March, Mr. Avramopoulos and a team of his ministry’s top officials will visit the United States, beginning in Los Angeles where he will present in Hollywood the attractions of Greece for the film industry. He will continue in New York, where he will inaugurate an exhibition featuring Greece’s tourist appeal. As part of the program to attract more tourists to Greece, he announced the opening of new tourist offices in Miami, Los Angeles and Chicago, and the upgrading of the New York office, in an effort, as he put it, “to open the doors of deep, sincere and lasting cooperation.”
A !30 million ($40 million) global promotional campaign has been launched to promote upmarket tourism to Greece.

Athens to Establish a Tourism Development Agency
Stressing that “the tourism industry of Athens has remained static for a long time,” the mayor of the city, Ms. Dora Bakoyannis, submitted to the City Council a proposal to establish a tourism development agency in collaboration with the private sector in an effort to raise the Greek capital’s profile as a year-round tourist destination.
Introducing the proposal, Mayor Bakoyannis told the Council that the capital’s static tourism record is damaging to its economy. “The Olympic Games,” she said, “brought Athens to the forefront of international attention, offering the city a unique promotional opportunity and the potential to boost its development . . . the Games conveyed to the world the impression that Athens is a capital of world-class standards. Now that Athens is equipped with modern facilities and services, there is great scope for development in the post-Olympic period.” The city’s goals for the next two years include the creation of more green spaces, upgrading residential areas, and improving the traffic flow.
• Outside of Athens, the prospects of tourist development in many regions of Greece were discussed at a meeting on February 7 between Tourism Minister Avramopoulos and the regional prefects. The meeting, which discussed subjects such as advertising and inter-regional cooperation, was the first since the establishment of a special committee comprising a wide representation of central government, tourist industry and local administration agencies. “A prerequisite for the successful implementation of the new strategy for tourism on a national level,” Mr. Avramopoulos said, “is the joint effort between central and local government” which had never happened in the past.
• The Foreign Ministry, following discussions with Greek ambassadors in a number of countries, is considering a plan to increase the number of tourist visas. The ministry has already adopted several measures to facilitate tourist arrivals. These include speeding up the process for issuing visas; issuing multiple-visit visas and visas allowing longer stays; eliminating the requirement for the personal appearance of trustworthy applicants; and improving Greek consulate premises and services.

Source: Press Office of the Embassy of Greece

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