Promoting new business opportunities in Greece to foreigners while the nation is undergoing such economic upheaval might seem a lost cause, but Charalampos Dafaranos has embraced the challenge.
Dafaranos, who took up his appointment as Greek ambassador to Australia in November, is predictably optimistic about the future. Rather than focus on how Greece is managing its economic crisis, he says, Australians should look at the many new possibilities.
Already, global companies such as Hewlett-Packard have answered the call. HP has chosen the port of Piraeus, a gateway between east and west, as its main distribution centre for Central Europe, the Middle East, the Mediterranean, North Africa and former Soviet republics.
“There is no doubt that in the annals of contemporary economic history Greece will appear an interesting test case, not only of consolidation, but of very drastic reforms,” Dafaranos says. “Drastic changes in Greece are occurring at a certain social cost, the people’s verdict in the election last year was in favour of .”
That option, thanks to the austerity package agreed with the EU Economic and Financial Affairs Council in December, requires Greece to bring its government deficit below three per cent of GDP by 2016. Legislation scheduled for introduction this year will have a huge effect on investment, especially an extensive program of privatisation. A nickel company, a munitions and light weapons company, almost a third of one of the world’s largest gaming companies, water supply companies, 29 regional airports and 12 ports are among the public assets to go under the hammer.
“There are many opportunities in terms of synergies with local partners or in taking advantage of the real estate potential . A large number of local airports and ports are to be privatised; that’s important for Australian investors. The strategic location of Greece, its lower labour costs and its high-calibre human resources, have become, for the first time, extremely important incentives.”
It is important to recognise, Dafaranos says, that as a union Europe is the world’s biggest trader. Australia should take advantage of its historical links with Greece. “Ours is a friendly environment, and Australians are received in a particularly cordial way. It’s something deep in the psyche of both countries.
“And we plan to enrich our institutional frame of co-operation with the introduction of an agreement to eliminate double taxation. Also, a new law makes it easier for non-EU citizens to acquire property on the Greek mainland or one of the 6000 islands.”
One area with plenty of potential is tourism, which in 2011 represented 15.7 per cent of GDP, 18.4 per cent of employment and earned more than … 10.5 billion. Last year, 16 million people – including more than 130,000 Australians – visited Greece, despite the country being in its fifth year of recession.
An ever-increasing number of coastal resorts, city hotels and other development projects are looking for equity or investment co-operation. Several big projects have attracted international tenders, such as the development of Athens’ former airport, thought to be the world’s largest urban development, and the 1.8 million-square-metre Afantou Property on Rhodes.
Food is another industry with opportunities for Australian manufacturers and suppliers. “It is a fundamental necessity whether a country’s in crisis or transition,” says Dafaranos, who has been impressed by the way Woolworths and Coles target well-informed, health-conscious customers. “We have Carrefour and the Greek supermarkets, but Australia has achieved sophistication in terms of diversifying products, especially healthy ones.”
Greece’s energy sector is now focusing upon renewables, so Australian expertise in solar, wind and geothermal energy, biofuels and waste management would be of tremendous benefit, Dafaranos says. The transport sector is also looking for investment, including for a 650-kilometre motorway project.
The Thessaloniki International Fair, which was launched in 1926 and will be next held in September, is a good chance for Australians to showcase expertise and products. Dafaranos says road shows in both countries under the banner of the European Australian Business Council are one way for companies to explore possibilities.
“Australia has so much to offer us in terms of best practices, new technologies and e-governance. We want to expand our links. This is a chance for us to engage Australia at different levels and our privileged relationship means we have a better understanding and respect. This is not only a time for introspection, but for delivery, for less rhetoric and more action.”
Dafaranos knows the economy won’t recover overnight. “A malaise occurred and a narcissism, but the crisis has created the opportunity for reinvention.”
He is well aware of the damage done by such prolonged financial mismanagement. “Our image has suffered. But the reality is that what’s happening is a drastic change of mentality and of economic activity. It’s not business as usual. There is a new effort to remedy the past.
“People understand they have to participate and become more competitive. And that to do so they have had to undergo significant changes in wages, pensions and superannuation. It is very natural to see demonstrations and hot tempers. We are Mediterranean and a bit mercurial. However, the majority has voted for this austerity.”
*This article was first published in The Deal magazine, part of The Australian.