Embed Size (px)
Citation preview
Alpha Bank Lecture
SEESOX
St. Antony’s College Oxford
Monday 9 May, 2011
Greece 2020: Unlocking The Potential Of The Greek Economy
Michael Masourakis
Chief Economist
Alpha Bank
2
Ageing And Unsustainability: Crime And Punishment!
FDI & Exports (2007) FDI & Exports (2007)FDI & Exports (2007)Retirement and Health Expenditure (as % of GDP)
ΕU-12
Greece
HealthRetirement
Reduction of expenditure due to the overhaul of the social security system
Without measures
24.1%
9.2%11.5%
4.7%6.0%
2007 2060
11.7%
5.0%6.4%
14.2%
2007 2060
Ageing Population
7.5
21.124.328.0
57.1
27.0
51.1
0
10
20
30
40
50
60
2010 2060
Greece EU-15
> 806.8 7.5
21.124.3
> 80
> 80 > 80
Old age dependency ratio(65+ / (15-64))
Time Deposits
63%
Deficit, Debt
156%159%159%154%143%
127%111%
-4.8%
-15.4%
-9.8%
-2.6%
-6.5%-7.6%-10.5%
-4.9%
5.6%3.2%
0.9%-1.1%
-4.7%-10.1%
2008 2009 2010 2011 2012 2013 2014
Debt Deificit Primary Deficit2009 2010 20122011 20142013
-50%
-40%
-30%
-20%
-10%
0%
10%
2020 2040 2060
0%
100%
200%
300%
400%
500%
600%
700%
800%DebtPrimary
Deficit
Deficit
Interest Payments
A pre-crisis long-run fiscal scenario 2010-2060
Source: IMF, August 2009
Source: European Commission, Feb.2011Source: European Commission, The 2009 Ageing Report
Source: European Commission, The 2009 Ageing Report
2009
as % of GDP as % of GDP
as % of GDP
3
Budgetary Derailment: Spending Other Peoples’ Money!
Source: Revenue Statistics, OECD
FDI & Exports (2007)Wages and Benefits / Taxes and Soc. Sec. Contributions
75.0% 77.2%
85.1% 85.3% 83.7%
70.1%
92.3%
105.5%96.9% 96.9%
2000 2008 2009 2010 2011
Euro Area Greece
12.29.0
13.5 12.116.1
11.4
10.8
10.68.3
10.61.5
1.8
1.9
2.3
3.42.5
3.5
3.7
2.8
2.99.0
11.6
7.1
7.5
Greece OECD Italy Spain France
Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Investment Driven Growth (%∆ YoY)FDI & Exports (2007)
Social SecurityContributions
Tax Revenue (2008)
% of GDP
Goods And Services
Property
CorporateIncome
Personal Income
4.7
Investment Driven Growth (%∆ YoY)
FDI & Exports (2007)Primary Deficit (General Government)
56.7 50.5 54.3 59.5
-50.4 -58.0 -51.7 -52.6
-9.6-9.6
-8.4 -8.5-9.6
-14.5-10.3 -3.8
-0.9-10.8-24.0-10.8
General Government Primary Deficit
2009 2010 2011B2008
State BudgetRevenues
in € bn
Other
Source: Budget 2011, Ministry of Finance Source: Government Finance Statistics, Eurostat, European Commission, Feb.2011
State Budget PrimaryCurrent Spending
State BudgetInvestment Spending
Public Sector Employees by Economic Sector (2010)
Out of the total number of employees of each sector
51%
73%73%
84%
89%91%
100%
69%66%
16%20%
32%
42%
62%
70%
36%39%
85%
TransportationStorageSports
Radio & TVBanks
Home CareTelecoms
HealthR&D
Social WelfarePostal Services
Planning ActivitiesEducationElectricity
Waste RemovalLibraries, Museums,
WaterPublic Adm.
16.9 th.8.3 th.5.2 th.4.7 th.
31.9 th.6.1 th.
14.6 th.130.4 th.
5.1 th.16.5 th.15.3 th.13.5 th.
243.4 th.23.1 th.19.4 th.
7.2 th.8.4 th.
374.4 th.
Source: Hellenic Statistical Authority
85.3%
22 out of 100 employees in the public sector
4
Fiscal Consolidation: Seven Lean Years!
The Fiscal Consolidation Effort, 2011-2015
Expenditures
-12.3
-4.6
-7.5
-4.6
-8.6
-5.4
1.2
-9.5
-0.5
2.9
-14.4-13.4
-11.6
-5.4
2.8
-3.6
-2.6
-11.5
-24.0
-10.8
-24
-19
-14
-9
-4
1
6
Primary Deficit (Central Gov.)Interest PaymentInvestment Budget DeficitOther
2008 2009 2010
Primary Deficit
Primary Deficit (General Gov.)
0
5
2011B-24
in € bn
Source: Budget 2011, Ministry of FinanceSource: Hellenic Republic, Ministry of Finance, The Medium-Term Fiscal Strategy, 2012-15, 15 April 2011, http://www.minfin.gr/portal/en/resource/contentObject/id/44f0e4b9-5589-4778-bac0-296bf8ad4856
19.1 20.9 20.6 21.5
12.113.5 12.5 12.5
6.17.1
5.3 4.65.0
5.36.5 6.6
6.9
6.45.3 5.1
2007 2008 2009 2010 2011
49.2%53.2% 50.2% 50.3%
Social Transfers
CompensationOf Employees
IntermediateConsumption
Interest
Other
2008 2009 2010 2011
as % of GDP
Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Revenue
13.5 13.1 13.0 12.7
12.1 11.1 13.1 13.8
7.9 8.2 7.9 8.5
6.2 5.46.6
7.7
2007 2008 2009 2010 2011
Social SecurityContribution
Indirect Taxes
Direct Taxes
Other39.7% 37.8%
40.6% 42.7%
2008 2009 2010 2011
as % of GDP
Source: The economic Adjustment Programme for Greece, Third Review, Government Finance Statistics Source: The economic Adjustment Programme for Greece, Third Review, Government Finance Statistics
% of GDP1. Streamlining the Public Wage Bill 0.9%
2. Reduction in Operational Expenses 1.1%
3. Closure/Merger of Public Entities 0.5%
4. Restructuring of State-owned Enterprises 1.0%
5. Reduction in Defence Spending 0.5%
6. Streamlining Health Expenditures 0.5%
7. Streamlining of Pharmaceutical Expenditures 0.7%
8. Reduction in Social Security Fund expenditures and streamlining of other social spending
1.1%
9. Strengthening of Tax Compliance 1.5%
10. Reduction in Tax Exemptions 0.9%11. Increases in Social Security Fund revenues and
tackling social insurance contribution evasion1.5%
12. Increase in Local government revenues 0.3%
13. Other expenditures 0.9%Total 11.4%
5
Debt Dynamics: Skating On Thin Ice!
FDI & Exports (2007)Μακροχρόνιες Προοπτικές 2010-2060 Χωρίς Μεταρρυθμίσεις
ΔΝΤ: Έλλειμμα, Χρέος και Ονομαστικό ΑΕΠΕισροές Ξένων Άμεσων ΕπενδύσεωνInvestment Driven Growth (%∆ YoY)FDI & Exports (2007)Investment Driven Growth (%∆ YoY)FDI & Exports (2007)General Government Financing Requirements and Sources (without € 110 bn maturity extension)€ bn
-20
0
20
40
60
80
2009
2011
2013
2009
2011
2013
Other
2009
Interest
Amortization
PrimaryDeficit
Other
Market Access
Troika
2010
2011
2012
2014
2013
2009
2011
2013
2010
2012
2014
Refinancing Needs
7.5
21.124.3
With € 110 bn 3 ½ years maturity
With € 110 bn 7 ½ years maturity
Source: The economic Adjustment Programme for Greece, Third Review
Public Debt Sustainability Scenarios
€ 11,8 δις
70
90
110
130
150
170
2006 2008 2010 2012 2014 2016 2018 2020
Baseline Scenario
1 p.p lower primarydeficit
1 p.p. highergrowth
as % of GDP
Source: The economic Adjustment Programme for Greece, IMF
Public Debt Sustainability AnalysisPrivatization Strengthens Debt Sustainability
Source: IMF, March 2011
Source: IMF, March 2011
70
90
110
130
150
170
2006 2008 2010 2012 2014 2016 2018 2020
Privatizations€ 50 bn in 2011-2015
No privatizations
* Nominal growth rate: 3,5% * Primary surplus: 5,5%
as % of GDP
6
ECB Funding
Banking: Good Banks, Wrong Place, Wrong Time!
Private sector loans and deposits
-15
-10
-5
0
5
10
15
20
25
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11
Loans to the private sector (yoy Δ%)
Private sector deposits (yoy Δ%)
%
Capital adequacy
18,1x24,7x
19,0x16,4x
102%
242%
183%
237%
Alpha Bank Peer 1 Peer 2 Peer 3Total Assets / Tangible Equity GGBs/Core Tier I
10.2%
12.0%
9.2%
9.6%
Core Tier 1 capital ratio
Source: Bank of Greece
Source: National Central Banks, ECB, IIF calculations
Source: Thomson Datastream, Credit Suisse, Capital Economics, Alpha Bank Research
Source: Financial reports and presentations of banks
0
20
40
60
80
100
120
140
160
2005 2006 2007 2008 2009 2010
Portugal
Ireland
Greece
Spain
€ bn
FDI & Exports (2007)Public and Private Debt
0
50
100
150
200
250
300
Po
rtu
ga
l
Ire
lan
d
Ne
the
rla
nd
s
Sp
ain
Gre
ec
e
Be
lgiu
m
Ita
ly
Au
str
ia
Fra
nc
e
Ge
rma
ny
Fin
lan
d
Households Businesses State
as % of GDPLoans / Deposits - 125%Loans / GDP - 112%
7
Doing Business Rankings
Corruption
Competitiveness Index Scores
Structural Rigidities: Atlas Overwhelmed!
-3 -2 -1 0 1 2 3
213. Somalia172. Pakistan
163. Russia137. Albania123. Serbia117. China
99. Bulgaria95. India
90. Turkey80. Italy
72. Greece36. Portugal
14. United Kingdom5. Denmark
3. New Zealand1. Finland
Governance
Source: Doing Business 2011, World Bank, International Finance Corporation Source: The Global Competitiveness Report 2010-2011, World Economic Forum
Source: The Global Competitiveness Report 2010-2011, World Economic Forum. Source: Governanance Indicators, World Bank
1.94
1.91
1.71
1.87
0.390.64
1.04
0.05
0.12
-0.41
-0.52-0.35
-0.93-2.53
-0.05
-0.77
GR UKEase of doing business 109 4
Starting a business 149 17
Protecting investors 154 10
Getting credit 89 2
Dealing with construction permits 51 16
Registering property 153 22
Paying taxes 74 16
Trading across borders 84 15
Enforcing contracts 88 23
Closing a business 49 7
72. Greece
2,32,9
3,13,2
3,84,0
4,75,25,3
5,75,8
6,06,6
2,0 2,5 3,0 3,5 4,0 4,5 5,0 5,5 6,0 6,5 7,0
Brazil 121Greece 94
Italy 77India 71
China 55Spain 50
USA 34Japan 27
Ireland 21Germany 14
UK 11Hong Kong 8
New Zealand 1
1 = very common7 = never occurs
2009-2010
GR UKBasic requirements 4.49 5.58
Institutions 3.67 5.28Infrastructure 4.57 5.88Macroeconomic environment 3.61 4.76Health and primary education 6.13 6.40
Efficiency enhancers 4.12 5.28Higer education and training 4.67 5.34Goods market efficiency 3.91 4.96Labor market efficiency 3.71 5.29Financial marekt development 3.88 4.73Technological readiness 4.06 5.58Market size 4.52 5.80
Innovation and sophisticaltion factors 3.41 4.98Business sophistication 3.83 5.32Innovation 3.00 4.65
Best score: 7
8
Structural Reform: Greece In The Reformatory!
State Owned Enterprises – Local Authorities
Future Supply of New Homes SlowsLabour market
Future Supply of New Homes SlowsLiberalization of professions
Investment Driven Growth (%∆ YoY)Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Pension reform
Minimum wage down by 16%
Extension of probation period for new jobs to 1 yr.
Arbitration system: symmetric access & independence
Firm-level agreements over sectoral/occupational
Elimination of the possibility of the MoL to extend sectoral __& occupational collective agreements
Reduction in over-time payment for part-time jobs
Increase in temporal limits in use of temporary working __agencies
Tackle undeclared work
Containment of the long-run increase in pension costs __from 12.5 to under 2.5 pps of GDP
Retirement age for males and females at 65 yrs by 2015 – __increasing in line with life expectancy after 2020
Pensions freeze for 2010-2013
Pension funds will be merged in three by 2018
Updated long term projections for pension expenditure by __March 2011
Reform of the functioning of supplementary pension funds
Impacts 160 services sectors
General prohibition of unjustified restrictions
Special legislative action for the liberalisation of the __profession of notaries, lawyers, architects, mechanics and __actuaries
Legislative action by the MoH for the liberalisation of the __profession of pharmacists
Expected positive effects amounting to gains in GDP of __over 10% in the long run and a downward effect on prices __of around 7.2%.
SOEs will be audited on a quarterly basis
The MoF’s special secretariat for SOEs is charged with the __overview of the restructuring
The MoF will revise Law 3429/05 on SOEs to ensure sound __corporate governance
Horizontal wage cut by 10% (+ wage ceiling)
Ceiling for extra payments at 10% of wage expenditure
Number of municipalities reduced to 325 from 1,034; __54 prefectures dissolved (their powers transferred to the __existing 13 peripheries)
Source: Economic Reviews, European Commission
Source: Economic Reviews, European CommissionSource: Economic Reviews, European Commission
Source: Economic Reviews, European Commission
9
Development of real estate assets
Telecommunications – Broadband
Airports – Ports – Roads
Key Privatization Initiatives: Ambitious Greece!
Energy – Gaming
Reduction of state’s equity holding in Public Power Corporation __(DEH) and in Public Gas Company (DEPA) to 34% in 2011-2012).
Development of undersea gas storage facilities through foreign __investment in 2011-2012.
Sale of nickel mining company (LARCO) in 2011.
Regulation of the gaming market (including e-gaming) in 2011.
Extension of the concession agreement for gaming/football __prognostics and issue of new licenses for e-gaming to OPAP.
Full privatization of OPAP (2012), Parnitha Casino (2011), State __lotteries (2011), Horse Racing (2012).
Source: Greek medium term fiscal strategy (2012-201), Ministry of Finance
Source: Greek medium term fiscal strategy (2012-201), Ministry of Finance
Source: Greek medium term fiscal strategy (2012-201), Ministry of Finance
Source: Greek medium term fiscal strategy (2012-201), Ministry of Finance
Extension of the duration of the concession agreement for Athens __International Airport ( AIA) and gradual sale of government stake.
Corporatization of all (29) regional airports to attract private capital / __know-how to upgrade operations (similar structure to AIA_concession).
Public Private Partnership structures to develop the Attica Port __System (Peiraieus-Rafinia-Lavrio) and 12 other regional ports to __upgrade facilities.
Private investment structures to equip marinas with modern tourist __infrastructure.
Operation, maintenance and toll rights for existing motorways to be __assigned to private investors on a concession basis (Egnatia Odos __Motorway by end-2011).
A special Purpose Vehicle with the rights to future toll revenues from __motorways will be set up and sold to private investors.
Registration and evaluation in a Single Land Registry.
Surface rights and long-term leaseholds legally established.
Conditions for holiday and tourist accommodation and property __development defined.
Zoning and building conditions for large properties expedited __(fast track procedures).
Individual specialized portfolios of large properties to be established in __a National Sovereign Fund of Public Land.
Portfolios to be structured as Special Purpose Vehicles for sale in __global markets.
Four portfolios to be delivered (one every six months from June 2011)
Creation of a modern and wide fiber optic cable network
Development of a modern telecoms broadband and digital __infrastructure utilizing the frequency spectrum and digital dividend __(starting in 2012).
Extension of mobile telecommunications licenses (in 2011).
Selection of a strategic investor in Hellenic Post to take operational __control of nationwide services (starting in 2012).
Reduction of state’s participation in the Hellenic __Telecommunication Organization.
10
Trade Sales to Strategic Investors
Other Initiatives
Sale of Concessions SPV
Privatisation: The Triumph of Hope Over Experience?
Estimated Revenue: € 12-17 bn in 2011-2013
Potential up to 2015
- € 10 - 15 bn from enterprises and infrastructure
- € 25 - 35 bn from strategic management of rights and real estate asset development
Timing
- 2011 € 2 - 4 bn
- 2012 € 5.5 - 7.5 bn
- 2013 € 4.5 - 5.5 bn
Source: Greek medium term fiscal strategy (2012-201), Ministry of Finance
Source: Greek medium term fiscal strategy (2012-201), Ministry of Finance
Source: Greek medium term fiscal strategy (2012-201), Ministry of Finance
Source: Greek medium term fiscal strategy (2012-201), Ministry of Finance
2011Frequency Spectrum - Mobile TelephonyOld Athens AirportReal Estate Investment - Portfolio I2012Egnatia Odos MotorwayPorts - Portfolio IHellenic MotorwaysRegional Airports - Portfolio IReal Estate Investment - Portfolios II and IIIFrequency Spectrum - Digital Dividend I2013Regional Airports - Portfolio IIReal Estate Investment - Portfolio IV
% owned ValueSale of Shares
Hellenic Telecomms (OTE) - 2011 16% € 621 mn
Partial Privatization and Introduction of Stragegic Investors
State Lottery Tickets - 2011 100%
Sale of banking operation after consignment activity spun-off
Consignment Fund - 2012 100%
€ 1,388 mn
Public Gas Corporation (DEPA) - 2011 65%
Public Power Corporation (DEH) - 2012 51%
% owned Value2011Hellenic Defense Systems 100%Railroads (TRAINOSE) 100%Nickel mining (LARCO) 55%Hellenic Horse Racing Corporation 100%Casino of Parnitha (Mont Parnes) 49%2012Hellenic Post (ELTA) 90%Athens Water and Sewerage (EYDAP) 61% € 370 mnThessaloniki Water and Sewerage (EYATH) 74% € 139 mnHellenic Vehicle Industry (ELBO) 51%Hellenic Football Prognostics Organization (OPAP) 34% € 1,659 mn2013Agricultural Bank of Greece 76% € 385 mnHellenic Postbank 34% € 314 mn
11
Infrastructure Investment: Pork Barrel with An EU Twist!
Private Public Partnership Projects
Source: Ministry of Finance
Five Major National Highways - € 8.7 bn
750 kms of new road – 530 kms upgrading of existing road € 2.3 bn from state budget + EU funds € 2.3 from tolls € 3.3 bn from bank loans € 0.8 bn from own funds Toll distribution: 65% to the State reaching 95% after 30 years State revenues: € 20 bn over 20 years
Social infrastructure projects € 600 mn in schools, court houses, police stations € 465 mn in waste management and disposal projects € 140 mn in urban transport (automation, e-tickets)
Future Supply of New Homes SlowsPublic Investment Budget (2011)
€
€ 6.2 bn
€ 2,0 bn
8,5From national sources only
Co-funded with the EU
€ 8.5 bn
59,2%
40,8 %
40,8Social Infrastructure
Economic Infrastructure
100%
From EU
€ 3.8 bn
7.5
21.124.3
FDI & Exports (2007)
Big Projects
€ 2.3 bn
59%
41%
Source: State Budget 2011
Basic Infrastructure 57%Transportation 31%Telecommunications 8%Energy 3%Environment & water 13%Health 3%
Human Resources 27%Education 12%Training 12%R&D 4%
Production environment 9%Industry 5%Services 1%Tourism 3%
Other 7%Total 100%
€ 7.9 bn
EU € 24.3
bn
GR € 7.7 bn
Public
Private
€ 40 bn
National Strategic Reference Framework, 2007-2013
Budget2011 onwards
Metro (Athens, Salonika) 2,065Construction of new motorways in Attica 1,000Kasteli airport in Crete 800Peripheral motorway of Salonika 650Photovoltaic park in Kozani 600Elefsina –Thiva motorway 400Salamina submerged channel 350Lefkada submerged tunnel 250Thriassio Pedion Logistics Centre 150Water management and irrigation 106
12
Foreign Direct Investment: The SSR of Greece in Transition!
Fast-track Implementation of Strategic Investments
Investments must meet at least one of the following criteria: Value of project must exceed € 200 mn or
€ 75 mn and it must create 200 new jobs Project must generate at least € 3 mn of investment
outlays every 3 yrs in areas
a) of advanced technology and innovation, or
b) of environmental protection, or
c) of education or R&D promotion Project must create over 250 viable & sustainable
new jobs.
Source: Bank of Greece
Source: Bank of Greece
Source: Eurostat Source: www.investingreece.gr
Future Supply of New Homes SlowsNet FDI Inflows
0.0
1.0
2.0
3.0
4.0
5.0
2003 2004 2005 2006 2007 2008 2009 2010
1.1
0.5
1.7
4.3
1.5
3.1
1.8
in € bn
1.7
Future Supply of New Homes SlowsFDI Inflows in 2004-2009
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
EU-27 Greece Spain Portugal Turkey China
4.4
32.8
17.518.9
22.3
as % of 2004 GDP
32.5
Investment Driven Growth (%∆ YoY)
-50
0
50
100
150
200
250
2003 2004 2005 2006 2007 2008 2009 2010
Other Services Construction UtilitiesManufacturing Mining Agriculture
Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Net FDI inflows (% composition)
Source: Bank of Greece
13
Goods: Top 10 Exports (2010) Goods: Top 10 destinations
Exports: Globalization And Its Discontents!
985
942753
466
398
392
391
371280
1,612
In € mn
Ελλάδα: Δαπάνες και Έσοδα Γενικής Κυβέρνησης
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
Q12008
Q22008
Q32008
Q42008
Q12009
Q22009
Q32009
Q42009
Q12010
Q22010
Q32010
Q42010
Tourism and Shipping (YoY %)Ελλάδα: Δαπάνες και Έσοδα Γενικής Κυβέρνησης
0
1
1
2
2
3
3
4
4
5
5
Q12008
Q22008
Q32008
Q42008
Q12009
Q22009
Q32009
Q42009
Q12010
Q22010
Q32010
Q42010
Exports of Goods(excluding fuel and ships)
Exports of Goods
Source: Hellenic Board of Exporters, The Greek Economy in Figures (2003), Viohalco
Source: Bank of Greece Source: Bank of Greece
Source: Hellenic Board of Exporters, The Greek Economy in Figures (2003), Viohalco
2000
€ 7 bn
2010
€ 10 € 10 bn
2010
Albania
Romania
France
USA
Un. Kingdom
Turkey
Bulgaria
Cyprus
Italy
Germany
€ 10
UKUK
Fuels
Pharmaceuticals
FruitsAluminum
Fish
Vegetables
Military Equipment
Cotton
CopperSteel
Total Exports: € 16.2 bn
In € bnTourism
Shipping
Top Ten: € 6.6 bn
14
* Ships greater than 1,000 gt
Shipping: Greeks At Their Best!
0
5
10
15
20
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
-15%
-10%
-5%
0%
5%
10%
15%
Shipping Receipts Imports Of Ships
-
50
100
150
200
Gre
ece
Japa
n
Chi
na
Ger
man
y
Kor
ea
US
A
Nor
way
Chi
na
Den
mar
k
Sin
gapo
re
total fleet capacity (dwt mn)
Shipping
World TradeVolume
Greek-owned ships
Ranking by capacity FDI & Exports (2007)Investment Driven Growth (%∆ YoY)Παραγωγή Ηλεκτρισμού (σε ΜW)Investment Driven Growth (%∆ YoY)Greek-owned fleet by ship type
In € bn
Source: IMF, Bank of Greece Source: Review of maritime transport reports, UNCTAD
Source: Review of maritime transport reports, UNCTAD Source: Lloyd’s Register – Fairplay, January 2010
Oil Tankers 46,8%
Container Ships 4,6%
Other 3,8%
Ore and Bulk Carriers 44,8%
0
500
1000
1500
2000
2500
3000
3500
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
-
20
40
60
80
100
120
140
160
180
200
Greek flag Foreign flag deadweight tonnage (mn)
capacityNo. of ships
(end-2009)In dwt (end-2009)
15Source: Association of Greek Tourism Enterprises (SETE)
Tourism: So Much Potential, So Little To Show For!
Arrivals and Receipts
5
10
15
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
5
10
15
20
Tourism Receipts
Tourist arrivals in Greece: Top 10 markets
Tourist Arrivals
In mnin € bn
Source: Bank of Greece, Civil Aviation Authority Source: Greek Tourism 2020, Association of Greek Tourism Enterprises (SETE)
Source: Association of Greek Tourism Enterprises (SETE)
FDI & Exports (2007)Investment Driven Growth (%∆ YoY)Παραγωγή Ηλεκτρισμού (σε ΜW)Investment Driven Growth (%∆ YoY)Seasonality (distribution of arrivals by month)
0%
5%
10%
15%
20%
Janu
ary
Feb
ruar
y
Mar
ch
Apr
il
May
June
July
Aug
ust
Sep
tem
ber
Oct
ober
Nov
embe
r
Dec
embe
r
Greece
Average ofCompetitors
(2009)
Competition (2009)
0
10
20
30
40
50
60
Spain Turkey Greece Egypt Portugal Croatia Cyprus
Receipts ($ bn)
Arrivals (millions)
Note: Arrivals for Portugal are for 2007
Receipts per Arrival ($) Spain Turkey Greece Egypt Portugal Croatia Cyprus 1,019 833 926 904 785 957 1,030
Beds Number ShareFive Star Hotels 91,770 13%Total 732,279 100%
Hotel Capacity (2009)
Arrivals from ShareExpenditure per
journey (€)Total Receipts
(€ mn)
Germany 16% 809 1,836UK 14% 779 1,625France 7% 783 732Italy 6% 702 629USA 4% 1,077 568Holland 4% 761 483Bulgaria 4% 177 116Austria 2% 812 286Sweden 2% 632 224Belgium 2% 939 314Total (top 10) 62 754 6,813
16
Residential Investment (2000 market prices)
Construction: The King Is Dead! Long Live The King!
0
50,000
100,000
150,000
200,000
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
3%
4%
5%
6%
7%
8%
9%
10%
Supply of New Homes
Residential Investment% of GDP
Long-RunAverage
0
50,000
100,000
200,000
150,000
Future Supply of New Homes SlowsNet FDI Inflows
0.130.150.220.39
0.250.170.120.08
0.0
1.0
2.0
3.0
4.0
5.0
2003 2004 2005 2006 2007 2008 2009 2010
Capital Inflows forHouse Purchases
1.13
0.50
1.69
4.27
1.54
3.07
1.75
in € bn
1.65
Future Supply of New Homes SlowsInvestment (2000 market prices)
0
10,000
20,000
30,000
40,000
50,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Non-Residential Residential Other
29.533.8
30.9
37.8 37.935.5
39.3
in € bn
41.538.3
34.0
28.4
7.5
21.124.3
FDI & Exports (2007)House Price and Mortgage Growth
-5%
0%
5%
10%
15%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Source: Hellenic Statistical Authority
Source: Hellenic Statistical Authority
Source: Bank of Greece
Source: Bank of Greece
House Price Growth
Mortgage Growth
Disposable Income Growth
17
Photovoltaic
Green Development Program, 2010-2030
Wind Energy
Green Business: If Only Money Was Not Scarce!
FDI & Exports (2007)Investment Driven Growth (%∆ YoY)Παραγωγή Ηλεκτρισμού (σε ΜW)Investment Driven Growth (%∆ YoY)Electricity Production (installed power in MW)
Hydroelectric
Lignite
Petrol
Natural Gas
Renewable Energy Sources
Hydrocarbons
Photovoltaic
Wind
Biomass1.327
700
3,3624,826
5060
7,6103,456
6,250
1,268
2,146
184
4,486
3,237
2010 2020 2010 2020
Green Initiatives Under Implementation
Subsidized program for improving energy efficiency of old __residential buildings.
New standards of energy efficiency for all building structures.
Green infrastructure – Green Business investment incentives __schemes
Subsidized electricity tariffs for renewables
Source: 2009 IEA Wind Annual ReportSource: Ministry of environment, energy and climate change
Investment Employment Requirements Creation
€ 31.8 bn 169,000
€ 2.3 bn 11,000
€ 9.5 bn 27,000
€ 0.9 bn 3,000
€ 44.4 bn 210,000
1,7% 2,1%
4,4%
6,5%
10,5%
14,4%15,0%
0%
2%
4%
6%
8%
10%
12%
14%
16%
UK Italy Greece Germany Ireland Spain Portugal
1,976
Total no. of turbines 18,400
939
21,164
1,270
4,237 2,490
% of national electricity demand from wind
• Climate change - low carbon economy Energy savings, renewables, natural gas
• Management/protection of natural resources Biodiversity, water, forests
•Quality of life - respect to the environment Air/noise pollution, recycling
• Environmental governance Zoning, urban renewal, R&D, innovation
Total
18
Exports - Imports
Common Agricultural Policy: a disaster
Aquaculture production
Agrobusiness: Back To The Future!
Lambda at ₤ 130 / lt at Harrods
2,796
3,9433,879
5,762
2000 2008 2000 2008Exports Imports
+39%
+46%
• Since 2003 there has been a moving away from subsidies based _on production to income support.
• This support is based on acres owned, cultivated or not, _multiplied by a per-acre subsidy received over a reference past _period (with special regimes applying for specific products _cultivated).
• Most kinds of direct income support will be abolished from 2013 _onwards.
• The result: most farmers are unable or unwilling to extricate _themselves from traditional surplus cultivations.
0
100
200
300
400
500
600
700
Greece Spain Italy Portugal
2000 2007
+23.4%-21.4%
+18.1%
-21.6%
Source: http://tastelaboratory.wordpress.com (April 2011)
Source: Hellenic Statistical Service., Hellenic Exporters Board Source: Eurostat
In € mn In € mn
19Source: “Human Development Report”, United Nations, 2009
Greece’s Got Talent: We Shall Overcome…
FDI & Exports (2007)Per capita GDP FDI & Exports (2007)Investment and Fiscal Consolidation
2010 Greece/Spain: 89.3
84.2
72.9
71.170.2
94.3
84.5
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
2000 Greece/Portugal: 103.9
Spain
Greece
Portugal
2010 Greece/Portugal: 118.4
2000 Greece/Spain: 86.3
Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Investment Driven Growth (%∆ YoY)FDI & Exports (2007)
Human Development Index Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Investment Driven Growth (%∆ YoY)FDI & Exports (2007)Index of health and social problems
0.78 0.80 0.82 0.84 0.86 0.88 0.90 0.92 0.94
Poland 41Portugal 40
Cyprus 35UK 26
Austria 25Italy 23
Greece 22Spain 20
Denmark19Belgium18Finland 16France14
Switzerland13Japan 11
Germany 10Sweden 9Canada 8
Netherlands 7Ireland 5
USA 4N. Zealand 3
Australia 2Norway 1
Per capita GDP (2009)
Greece $ 28,630Spain $ 31,870 Italy $ 35,080Germany $ 42,560
Source: “Statistical Annex of European Economy, European Commission, Autumn 2010,European
Source: Wlkinson and Pickett (2010), The Spirit Level: Why Equality is Better for Everyone.
Source: European Commission, Hellenic Statistical Authority
• Japan
• SwedenNetherlands
• Switzerland
• SpainCanada • Italy
Australia
• New Zealand
• USA Worse
-6%
-1%
4%
9%
14%
19%
24%
1991 1994 1997 2000 2003 2006 2009
Private Investment Public Investment Primary Surplus (-)
Better
Low High
Income Inequality
Ind
ex o
f H
ealt
h a
nd
so
cial
pro
ble
ms
Norway Finland
Denmark Belgium
Austria
GermanyFrance
IcelandGreece
UK
Portugal
as % of GDP
