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Past
the Finishing Line The predominant task of Prime Minister Konstantinos Karamanlis and his 4-month-old center-right government is to ensure that the Greek economy continues to maintain its momentum after next month’s Olympic Games. “We have growth, but it comes mainly from the construction sector,” says Giorgos Alogoskoufis, the minister of economy and finance. “What we have to do now is make sure that the economy keeps ticking after the Olympics, when the construction sector is no longer booming.”
To do this, he says the government will introduce structural reform in all the sectors where Greece has comparative advantages, such as tourism, services and various industries. New legislation to reform the tax system and to encourage investment will be ready before the end of the year. Alogoskoufis says the New Democracy government’s view of privatization differs markedly from that of the previous socialist administration. “For us the major issue is to make sure that the companies that are privatized are also reformed, that they work more efficiently and that privatization is accompanied by liberalization of the market.” Previous government policy was to sell minority stakes in public enterprises to reduce deficits. In June the government’s National Competitiveness Council approved a 16-point plan to improve economic performance, and in consequence the investment climate. This plan includes provisions for a more efficient absorption of European Union funding (especially in the health
sector), simplifying business and investment red tape, reforming the notoriously labyrinthine tax system, deregulating markets, encouraging farmers to adopt better business methods and slashing the state deficit and public debt, all to be done, hopefully, by 2008. A ray of hope comes from the left-dominated General Confederation of Labor, which in the past has stalled several attempts to reform the labor market and pensions provision. This year Christos Polyzogopoulos, the national trade union boss, has signaled that he will go along with most of the program with a minimum of strikes and other disruptions. One sector ripe for deregulation is energy. For decades, the whole country’s electricity has been generated by the state-owned Public Power Corporation (DEH), while efforts to find a strategic investment partner for Hellenic Petroleum (DEPA) have so far foundered on an apparent lack of investment incentives. “Wherever the regulatory framework is still unclear, potential investors cannot proceed,” explains Alogoskoufis. Topping the privatization list is Olympic Airlines, followed by the energy and telecoms sector utilities. Another area in which the government feels much can be done is agriculture. Says Alogoskoufis, “We have not marketed our Mediterranean agricultural products as well as we should. We need to standardize our products and services.” This he believes might enable Greece to capitalize internationally on the appeal of the so-called Mediterranean diet to the health-conscious. The economy ministry is targeting major European capitals for a more organized selling campaign for olive oil and other Greek agricultural produce. Alogoskoufis is keen to encourage greater investment in Greece by international investors, and a basic element in this endeavor is a planned reform of the tax laws. “The two biggest disincentives to foreign direct investment in Greece are first, taxes, and second, the tangle of bureaucracy and planning permits.” By autumn, he pledges, a new tax and investment incentive system will be in place, which is expected to pave the way for a fundamental change. Back to topGetting the Act Together For all her undoubted drive and ability, Gianna Angelopoulou-Daskalaki confesses that when she took charge of preparations for the Olympics six years ago, she did not realize the sheer magnitude of the ordeal awaiting her. She had to tussle with contractors who too often fell short of their commitments, juggle power struggles within the Athens 2004 committee, while at the same time keeping at arm’s length the International Olympics Committee’s thinly veiled impatience. Her job has been more difficult and demanding than that of any politician. Indeed, a great many people are prepared to argue that only a woman with her diplomatic talents could have pulled it off. “I strove a lot, I got angry a lot, I cried a lot,” she recently confessed to an Athens magazine. But this would never be apparent from the cool, self-assured image she projects, always impeccably turned out and coiffed, always with an optimistic message. Talking to Angelopoulou, one comes away convinced that for her, the Olympic Games are about much more than money and sport. The ethnic pride element, based on the fact that the Olympic Games were first held in ancient Greece, counts for a lot. “We would like our Games to be remembered as an Olympic homecoming,” she says, “a return to the values that make the Games unique.” Not that she underestimates the very real practical benefits Athens as a city has already gained. “It has been amazing to watch what were just ideas on paper in 1997 becoming new subway lines, state-of-the-art venues, parks and open spaces, almost before your eyes,” she says. True, it is thanks to the Olympics that Athens is now a nicer city to live in, but there is also a political dimension. When the conservative New Democracy Party was elected in March, it found a considerable works legacy left by the previous Panhellenic Socialist Movement (Pasok) that had been in power for 11 years. Some think it unfair that the conservatives will have the places of honor at the opening ceremony instead of the socialists who say they did most of the work. On the other hand, most of the delays that have caused intense nail-biting in the IOC occurred on the socialists’ watch. “It’s not the time to blame anybody,” says Fani Palli-Petralia, the alternate minister for culture who has taken a visibly hands-on approach to finalizing the preparations. “What we have done is accelerate the effort.” From the beginning of May, the results began to be visible. Symbolic of the entire gamut of Olympics preparations was the completion of the $200 million roof over the Olympic Stadium. Designed by high-profile Spanish architect Santiago Calatrava, the soaring metallic structure may well not have become reality at all. Criticized even by the IOC as needlessly extravagant for a small country like Greece, the roof was painstakingly constructed in two halves that were slid together less than 80 days before the Games’ opening ceremony. Other infrastructure facilities are also coming together at the last minute. Credit for this goes largely to George Souflias, the crusty, plain-talking minister for public works, planning and the environment. His biggest headache has been the Marathon road, the 26-mile route said to have been traversed by the ancient courier Phidippides when he bore the news of the Athenian victory over the invading Persians in 490 BC. Unwisely chosen contractors had gone bankrupt, delivered shoddy work or both, with the result that work on the road has had to be restarted from scratch. “I categorically assure all, that the Marathon road will be finished well before the Games began” vows Souflias. The contestants in the 2004 Olympic marathon – the first since 1896 to follow what is claimed to be the original route – will have smooth asphalt under their feet. Like most in the Greek government, Souflias sees the Games as a springboard for future investment. “Right now we are working on a new bidding system to be characterized by transparency,” he says. “We need to create the right environment for investors.” A sign of this appeared in the spring, when visitors flying into Athens were greeted by the sight of a smart new, jewel-like airport railway station. It seems to have gone up in no time.
Ultimate Destination One of the new Greek government’s first actions was to create a Ministry of Tourism. Previous administrations, mostly socialist, had no ministry dedicated to the sector, presumably taking the view that as the fountainhead of European civilization and the home of countless sun-soaked Mediterranean islands, Greece had no need to promote itself as a tourist destination. In practical terms, this meant that tourism lost out in funding allocation, and Greece was not promoted aggressively in world markets. The newly appointed Minister of Tourism, Dimitris Avramopoulos, who has served two terms as Mayor of Athens, intends to change all that. “When you talk about Greece, you talk about the ultimate destination, a dream destination that everyone should visit at least once in a lifetime,” he says. “But we have to take greater advantage of this. Greece is not a destination that needs to get known. People already know about us. The issue is now to drive toward quality, and for that we need quality of infrastructure. We need investment. We need facilities.” Avramopoulos says that the tourism sector has been stuck for too long in the sun-sea-romance formula. Other countries in the region offer precisely the same thing. It’s time, he says, for Greece to become a little more sophisticated, although there will still be plenty of sun and sand and other associated pleasures. But Avramopoulos worries that if uncorrected, this simplistic picture could give a distorted impression of the country’s potential. Within a month of taking office, Avramopoulos outlined his vision: “We are preparing a long-term, ten-point strategic plan. We want to create the right environment for investment, get rid of bureaucratic obstacles, modify the fiscal system, open new channels of communication, adopt modern methods, implement new technologies and expand into new markets. It’s a strategy that aspires to make tourism into the leading edge of our economic policy.” Tourism now contributes approximately 18 percent of Greece’s GDP – but Avramopoulos hopes that his plan can be the engine to double this share. The Olympic Games is, of course, a powerful magnet for visitors. In 2000, as mayor of the next host city, Avramopoulos was at the closing ceremony of the Sydney Games to receive the Olympic flag. “As I received the flag,” he recalls, “I was confident that this would be the biggest opportunity for our country.” The opportunity, however, was not fully grasped, he says. It took the establishment of the new tourism ministry to launch an Olympics-related promotional campaign and to make the most of the potential impact that this international extravaganza can achieve. On the drawing board are plans for business and convention tourism, agro-tourism, spiritual tourism (say, in the footsteps of Saint Paul) and sporting tourism (for example, developing the ski slopes on Mount Parnassus). There are still relatively unexplored islands where it is possible to swim the whole year round, while the picturesque mountain hinterland contains as yet undiscovered villages ripe for appreciation – and investment. Already Athens, much maligned for its smog and intractable traffic problems, is becoming a more congenial city to live in, and the Olympics can be thanked for much of that. When the Games are over, Athenians and visitors alike will continue to enjoy the benefits of a clean and quick Metro, new ring roads and a tramline, not to mention the enviable sporting venues. The city’s crime rate remains comparatively low. “Even young girls can walk here at night and feel safe,” says Avramopoulos. This, he maintains, is more than can be said for most other capitals in Europe and elsewhere.
Strong Foundation The 2004 Olympic Games have come as a godsend to those who, like Stelios Papadimitriou, link everything Greek to the ancients. “We really believe that Hellenic culture is something that is missed more and more these days,” he says. Papadimitriou is the president of the Alexander Onassis Foundation, which was established by the shipping magnate Aristotle Onassis, in memory of his son who was killed in a plane crash in 1973. “The foundation is very much concerned with promoting cultural projects, which are essentially linked with Hellenic culture,” says Papadimitriou. “We believe that Hellenic culture is global.” The foundation latest project is a cultural center to be called the House of Letters and Arts, an institution designed to sponsor at least six of the most universal performing arts. “It is a huge project that will keep the foundation busy for many years to come,” says Papadimitriou. He believes that the foundation is doing what Onassis himself did in his lifetime: managing wealth in order to increase it and put it to good use. The legendary tycoon expressly stipulated as much in his will. Papadimitriou says Onassis was not someone much taken by fantasies or by high expectations. “He knew human beings, and he also knew that in order to achieve a good result for his own foundation, the people he appointed would have to do many things. First of all was the need to survive financially and second to select good projects and good people. “Today, almost 29 years after his death,” he says, “I believe that the foundation is stronger than ever.” Papadimitriou will not disclose the foundation’s value today, but he hints that through canny investments, it is worth considerably more than it was at its beginning. Half of the profits are spent on public benefits in the culture sphere and half reinvested. “Fortunately, “says Papadimitriou, “profits have always exceeded losses.”
No Insecurity in Athens Seven years ago, when Athens was selected to host the 2004 Olympic Games, few could have predicted that security would play such a pivotal part in the proceedings. But since then, the world has become a darker place: 9/11, the war on terror and the proliferation of violent extremist organizations have given the globe a fit of the jitters. Small wonder that intense scrutiny is being focused on what is the Western world’s biggest sporting celebration every four years. Whenever he has the opportunity, Minister for Public Order Yiorgos Voulgarakis reiterates that the $1billion steel security ring around the XXVIIIth Olympiad will be as unbreachable as it is possible to make it. In reality, 100 percent security is impossible, but thanks to extra muscle provided by the United States and Nato, as well as crack teams from Britain, France, Italy and Israel, it should be close to 99 percent. “Perhaps in no other country has such a big, coordinated security operation ever been mounted,” Voulgarakis said during a recent visit to Washington. Indeed, as word of the scale of the security effort has spread, early nervousness voiced by some American athletes has evaporated. Says chief Olympics organizer, Gianna Angelopoulou-Daskalaki, “In 1997 we Greeks promised the International Olympic Committee that we would host a safe and secure Games; [it is] a promise we will keep.” More than 37,000 armed military and police personnel will guard the athletes and officials from 202 countries around the clock. Security cameras will be mounted in key Athens locations to monitor traffic patterns. The Olympic Village itself will be almost impregnable. Nato early warning radar aircraft will crisscross Greek airspace to keep out any intruders, while warships will patrol Greek territorial waters. After the Madrid train bombings, Athens Metro staff began to carry kits containing a mask, gloves and decontamination materials. The piece de resistance of the elaborate shield is known as C4I (for command, control, communications, computers and intelligence), described by a Western diplomat as “the Cadillac of security systems.” This is a complex of cameras and detectors that feed information into a central command center, which looks out for possible patterns that might indicate a hostile activity being hatched. After some haggling over terms, the $250 million system was delivered in June. It uses a fiber-optic cable network that bypasses conventional communication lines. There was a brief flurry over Olympic security in May, when several intrepid foreign journalists snuck into uncompleted venues, such as the Olympic Stadium, to make the point that security around construction sites was not as tight as it should have been. Though much resented and criticized by Greece’s government and media, the intrusions paid off in that security holes were promptly plugged. However effective C4I will be in keeping the Games free from harm, the system will be around for the future, so Athenians will have an extra point when they say that their city is one of the safest in the world.
Back With a Vengeance Brad Pitt has come just in time for the Greeks – not only in the Tinseltown version of the culmination of the Trojan War, but also as a boost to the national ego in the face of international media criticism of delays in the preparations for the Olympic Games. When Troy, featuring Pitt as the legendary Greek warrior Achilles, hit Athens cinema screens, it broke all attendance records, accounting for a quarter of a million ticket sales in the first three weeks. The distributors could not keep up with the demand for copies. Audiences young and old sat entranced, swelling with pride at Hollywood’s larger-than-life portrayal of their heroes: In the scene where the massed Greek army under King Agamemnon surges into the ranks of the Trojans, younger viewers cheered. In this Olympic year, the blockbuster is also grist to the mill for the marketing of ancient Greece. The Parthenon overlooking the Acropolis in the center of Athens, the galaxy of museums and archaeological sites and, this year, the Olympic Games themselves, are what the Greeks of today see as a continuation of their past. If there is money to be made out of it, so much the better. Yet there is a special satisfaction with the release of Troy – not just because the blond, blue-eyed Brad Pitt was cast as the quintessential Greek. In recent months, the Greek government, media and public have bridled at what they are convinced is malicious foreign reporting on the delays and alleged security glitches in the Olympics preparations. Regardless of their accuracy or inaccuracy, the stories have touched a raw nationalist nerve. In its own way, Troy came to assuage the hurt Greek pride – even if the Greeks are portrayed as the aggressors. For decades, Hollywood has preferred Rome to Greece: The last film with an ancient Greek theme was The 300 Spartans in 1962, starring Richard Egan as the Spartan king Leonidas, who fell at the doomed defense of Thermopylae in 480 BC. In the words of one viewer, “Troy shows that Greece was once a great power.” Some see the movie as an allegory of Greece’s present-day rivalry with Turkey, though academics deplore the obvious distortions of Homer’s Illiad, the main source for the story. The Greek government hopes that some of Brad Pitt’s glory will rub off on modern Greece by motivating American and European viewers to come to Athens for the Olympics. “The first Olympic Games of 776 BC were the beginning of history – part of the DNA of the Greeks,” says Fani Palli-Petralia, the alternate minister for culture. And, in words that could have come from the mouth of Achilles himself, “You cannot have a healthy body without cultivating the mind. The Olympics are not just about sports, but about culture as well.” Troy might just get some people to start leafing through their Homer again. Or, at least, buying the DVD.
Playing the Numbers Game A typical day in the life of Anestis Philippidis, the newly appointed chairman of OPAP, starts with a hearty breakfast, and, skipping lunch, ends with a light dinner. In between he works himself hard. OPAP is the Hellenic lottery organization that operates Greece’s popular football pools. Philippidis is acutely aware that opap has become one of the most profitable Greek businesses. It is one of the five companies with the highest capitalization and Europe’s second-best-performing blue chip company. He knows he is sitting on one of Europe’s biggest money machines and needs to exercise strong management. “Judge me from the results,” he says, “not on what I’m saying now.” Yet even on his appointment to the helm of the state-controlled organization, OPAP’s share price jumped 20 percent. As the biggest online gaming network in Greece, OPAP serves some 3 million customers a year, carrying out more than a million transactions a day. The lottery is on the verge of further expanding its services via the Internet and interactive television, and is also eyeing foreign markets. First-quarter 2004 financial results justify a certain optimism. The adjusted net profit came to e87.5m ($107m), up 8.5 percent over the first quarter of 2003 on revenues of e695.2m ($848m) – up 9.3 percent in the same period. Payouts in the period came to e406m ($495m), up 11.1 percent. This year Kino, a new numbers game that is popular with traditional football pool punters, accounted for 75 percent of new revenue in the first quarter of this year. The game should achieve a nationwide penetration by the autumn. OPAP has the sole state sector concession to operate and manage sports-betting games in Greece. Risk management has been delegated to the privately held Intralot, whose betting company arm runs a vast international gaming network stretching from Chile to the Philippines. The Greek state floated 49 percent of OPAP equity in 2001 – and two later share offerings were oversubscribed by a factor of more than five. “My expectation is that the shareholders will get more money,” says Philippidis. “They will see it very soon.” Two avenues of improvement that are opening up are research and development, and possible foreign expansion. “You have to think internationally today,” says Philippidis. Balkan markets have long been on the drawing board. But the most immediate target is to increase awareness of the possibilities of Greece’s gaming industry through the Olympic Games. There will be no betting on any of the contests, and the Greek government, anxious to avoid charges of capitalizing on the Games, has blocked anything suggestive of profiteering. “But the Games give us a chance to became better known,” says Philippidis. “You have a chance to spread your ideas and strategy. I’m very interested in foreign investors. This is the biggest event in the world – and OPAP is the best opportunity they have to invest their money.” Philippidis is not interested only in the financial aspect. He credits the Olympics with triggering tremendous changes in Athens itself, and in Greek business as a whole. “The Games will pay us back,” he says. “The question is, how will we use it?”
Byte-Size Success If any one name can be said to personify Greece’s premier business success story over the past quarter of a century, that name is Intracom. Founded in 1977 as a local manufacturer of telephone switchgear, the company now girdles a global electronics, computer and software market employing more than 4,000 people and is represented in some 50 countries. “We have been investing in understanding the economic environment in the greater southeast European area, from Central Europe to North Africa and the Middle East,” says Chief Executive Officer George Deligiannis. “You will be seeing a lot of investment there in the next few years. Our strategy is to become one of the strongest players in telecoms, systems, banking and defense.” According to Deligiannis, Intracom still needs to market itself aggressively. “It’s hard for many people to see Greece as a source of technology and professionalism,” he admits, citing one hurdle. Yet Intracom has a history of swift accomplishment. By 2000 the company was setting up ISDN terminals in Mexico and penetrating the fledgling Armenian software markets. Electronic services such as broadband applications are generating high demand in Eastern Europe and the Middle East. “We have a natural understanding of information technology,” says Deligiannis. “And there’s going to be much more competition in the next few years.”
In 1889, the Greek prime minister of the time, Harilos Trikoupis, signed a momentous commitment: to bridge the two shores of the Gulf of Corinth where they narrow to just over a mile at Rion. More than a century later, the bridge has become a reality, answering the prayers of generations of motorists forced to use the slow ferry to cross from the Peloponnese to the Greek mainland and vice versa. The bridge has taken six years to build, with the last slab of concrete roadway being slotted into place in May. Its first official traffic will be the runner bearing the Olympic flame to Athens, scheduled to cross the bridge on August 8. Unlike what might have materialized in the late 19th century, the Rion-Antirrion bridge (formally named the Harilaos Trikoupis bridge in honor of the man who broached the idea) is a triumph of engineering and aesthetics. Covering a distance of almost 2 miles, the new bridge is the world’s longest continuous suspension span. Resting on reinforced concrete piles that are more than 200 feet across at their base, its starkly modern towers are visible for miles down the Gulf of Corinth – and it is able to withstand earthquakes of well over 7 Richter that would flatten more conventional structures. While ferries currently take around 45 minutes to transit the narrows, the Rion-Antirrion bridge will cut the time to just five minutes and will be enjoyed by the drivers of an expected 11,000 vehicles a day.
Greece is hosting the Olympic Games in the same year it celebrates the 50th anniversary of its internationally renowned Hellenic Festival. Staged throughout the summer months at two ancient amphitheaters, the Herodium Atticus, close to Athens, and the Epidauros theater in Peloponnese, 120 miles east of the capital, the festival’s cultural events last year attracted a total audience of 200,000. This year, for the first time, the Herodium staged a morning concert so that the opening performance by the Berlin Philharmonic Orchestra, which launched the festival, could take place in daylight and be transmitted live by satellite to a worldwide audience. Maria Callas and Rudolf Nureyev are among the many gifted artists who have graced the festival events during its first half-century, and last month, Luciano Pavarotti performed at the Herodium as part of what is described as his farewell world concert tour. Yiannis Karachisaridis, an economist and theatrical director who is president of the Hellenic Festival, says, “One of our priorities is to raise the profile of Greece as a center of culture and to show that it is not just a sea and sun destination.” |
