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It just takes a BBC interview.

Dear reader,

This is our weekly round-up from Greece.

Tourist season just officially kicked off in Greece, causing the lifting of most restrictions. In this context, Tourism Minister Theocharis tried to persuade the BBC on how well prepared the Greek government is for inviting tourists. It appears he found it rather difficult.

From other recent developments, we chose to focus on two that serve as case studies on how the Greek economy has been brought to its knees:

The court decision on the Siemens scandal has just been written up and highlights how important actors involved continue to dominate the political scene in the Greek state.

And Piraeus Bank has been again privatized (after being briefly nationalized), at an estimated 3 billion loss for the Greek state. 
 

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Tourism Minister Theocharis & the Greek government “stripped naked.”


Since the tourism season started officially, the lifting of restrictions has proceeded: From the 14 May movement SMS, along with click and collect in the shops are abolished. Curfew now starts at 00:30, with catering facilities closing down fifteen minutes before that. Music will still not be allowed in catering facilities throughout May (because we all know notes transmit the disease). Inter-prefectures travel is allowed, with the precondition of a negative PCR/Rapid test prior to traveling by airplane or ferry or vaccination or Covid19-recovered certificate. The same preconditions will apply to foreign nationals. From June 1st, Greece will reportedly accept the EU “Green Covid-19 Pass.” On 31 May, gyms and wellness centers, as well as open-air catering and reception spaces, will reopen. Casinos reopened on 14 May - before gyms and the open-air cinemas (21 May) (Gambling, after all, is more essential to your well-being than exercising and enjoying art).

In the context of the government’s antiCovid19 non-existent policy, Education Minister Niki Kerameos announced this week that Covid19 self-tests in schools are decreased from two to one per week. And the Minister of Shipping Ioannis Plakiotakis announced on Friday that the ships’ capacity was increased to 85%.

Amidst the frenzy of the tourism season starts, Tourism Minister Harris Theocharis gave an interview to BBC’s HardTalk and to journalist Stephen Sackur on 12 May, while on a three-day visit to the country to meet with state officials and tourism agents in order to promote tourism in Greece. The UK has not included Greece in its “green” list, but on the “amber” list, meaning restrictions will apply to people returning to England after visiting the country. In short, Theocharis went there to try to make the British change their minds.

It is quite uncommon for ministers’ interviews with foreign media outlets to go viral in the minister’s country. However, when you live in Greece, where mainstream media journalists (or so-called journalists) do not really interview people in power but engage in a public relations discussion with them, then a BBC (aka proper) interview will go viral. For the very simple reason that the Greek public has a rare chance to hear the proper, hard questions that every journalist ought to ask.

In the interview (which you can watch here) Theocharis appeared as feeling at least awkward by the questions posed. Sackur referred to Greece opening up a bit early as hospitals still feel the strain and vaccination rollout is slow. “You have over-promised and you have underdelivered,” Sackur said regarding the promise for fully vaccinating the islands around the end of April. He even touched upon the allegations for excessive use of violence during illegal pushbacks of migrants by Greece and why the Greek economy is still at a palpable state despite help from the EU.

While the interview went viral on Greek social media, I can’t help mentioning here how a British friend commented on the BBC journalist: “He didn’t really go that hard on him.” This alone illustrates how far apart journalistic realities are in the two countries.

The next day, State Minister Gerapetritis stated in a TV interview that “not one thing from what was said in this interview by the journalist was valid,” thus characterizing one of the most well-respected journalists as a liar. He admitted however he hadn’t watched the interview (“With the reservation that I have not listened to the interview,” he said.)

A couple of days after the interview, Theocharis gave a “fiesta” for the Greek press on the occasion of the start of tourist season. This took place in the idyllic scenery of Sounio. Possibly trying to outweigh the negative impression from the BBC interview?

Gerapetritis’ reaction to the interview is characteristic of the government’s mentality. We referred to the lengthy letter Culture Minister Mendoni addressed to Libération, protesting the newspaper’s reportage on the cemented Acropolis’s paths. Libération’s correspondent in Greece who wrote this piece, Fabien Perrier, recently commented on Mendoni’s attack against him on a TV interview with a Greek channel: “I had in the past accepted attacks in the social media. But now I had to deal with a formal announcement, in which my name was flamboyantly referred to,” he said. “My investigation was based on journalistic criteria. It is now an expression of personal preferences. It is the outcome of work in the context of which I spoke with many different people. I have the feeling that we are now in a position that we cannot initiate a dialogue, we cannot present different aspects. What worries me is that this is in essence an effort that wants to silence journalists,” he concluded.

However, if the Greek government is to reply to all foreign media reports, they will certainly have a hard time as the government’s wrong-doings are becoming more and more internationalized. This week, the French newspaper “Le Monde' also' published a report on the Acropolis. “Archaeologists and historians are talking about a sacrilege at the Acropolis,” Le Monde wrote, referring extensively to the works underway at the Acropolis. “Acropolis SOS '' is the desperate cry which brings together Acropolis’s lovers who have to face the project approved on 3 February by the Greek Culture Ministry and will start this autumn, it continues. “At the epicenter, the marble reconstruction of the Propylaia staircase, which was leading to the top, a project that in their eyes is a deviation from the cultural heritage and also a misreading of history.”
 


 

A 2019 court decision on the Siemens scandal was just written up - It directly connects ND and PASOK parties to the scandal.


A 4,000 pages Greek court decision issued in December 2019 has just been written up after almost one and a half years. Parts of the decision have been published and shed light on the German company Siemens’ connections with the two political parties that dominated Greek political life for 40 years - ND and PASOK.

According to the decision, Siemens “steadily, systematically and overtime” were financing PASOK and ND.

“... PASOK was the final recipient of this money amount, in the context of the illegal financing Siemens was applying, steadily, systematically, and over time towards the governmental parties in Greece. PASOK was one such party, as it was dominant in the political life of the country as a governmental party for almost two and a half decades, from the beginning of the 1980s to the middle of 2000s…”

Twenty-two out of the 54 defendants in the case have been convicted, among them Siemens Hellas and Siemens Germany executives as well as (ex) national telecommunications (OTE) and bank executives. However, the court cleared one of the main actors in the case, PASOK’s Theodoros Tsoukatos, as his case was time-barred. Four Siemens executives involved in the scandal in Greece have fled abroad.

One of these executives, Michalis Christoforakos, who has fled to Germany (with Germany then denying his extradition in Greece) was said he was retaining close relations with certain politicians, among them current PM Mitsotakis and his sister, ex-Foreign Minister and now MP, Dora Mpakogianni, according to Christoforakos’s secretary Katerina Tsakalou’s testimony in the trial. Tsakalou even referred to Christoforakos renting a helicopter to attend Kostas Mpakogiannis’s wedding (son of Dora and today Mayor of Athens.)

Simply put, Siemens was bribing Greek officials (the amount had been estimated to 130 million German marks)  in order to undertake state projects, which were usually overpriced. That is, their actual price was much lower than the price the Greek state was called to pay, ending up in circa 2 billion euros loss for the country, as a Special Parliamentary Committee estimated in 2011.

However, the Greek state never got compensated for this loss. In fact, it didn’t even seek it. Instead, on 22 August 2012, then Finance Minister Yannis Stournaras under the Papadimos government signed a so-called compromise with Siemens. Far from being a compromise, however, the deal was in effect setting Siemens free from any obligation to compensate the Greek state. It provided that the company would carry out certain projects for Greece of a total cost of circa 270 million euros (so, they weren’t even required to pay cash), an amount far short of the 2 billion loss in public money.

Today, the person who signed that “compromise” deal, Yannis Stournaras, is head of the Central Bank of Greece, giving consultation on the prospects of the Greek economy. SYRIZA which had then characterized the compromise as “scandalous” did not undertake any action to change things when they became government.

This is one of the biggest scandals that have ever taken place in contemporary Greece and illustrates how the country’s economy is doomed to failure for at least decades to come, due to deeply corrupt politicians and justice that was never really delivered.
 


 

Piraeus Bank recent share capital increase explained - Or how the broken Greek economy lost again billions in public money.


This month marked the beginning of a new chapter for Piraeus Bank as its new shareholders entered the stock exchange. This was also the culmination of a long-planned scheme to the detriment of Greek public finances. Piraeus Bank increased its share capital by 1.38 billion euros in April. This is reported to be the largest share capital increase in Europe, following the July 2017 Santander one. Since then, there have been circa fifteen share capital increases in the Continent (English, Italian, Polish), all with smaller amounts.

This would probably be just financial news if Piraeus Bank had not been nationalized before being again privatized at a huge loss for the Greek state. When the decision for the share capital increase was officially announced, on 8 April, analysts pointed out that this would happen at a loss for the Greek state and the current shareholders. The Bank’s Managing Director himself, Christos Megalou, stated he understood the significant dilution current shareholders would have to bear, yet the Bank’s administration defended the plan to improve its balances through dealing effectively with the 19 billion euros in “red” loans, which renders -the bank’s management claimed- necessary this increase in capital share.

However, to understand what’s happening we shall explain the whole story briefly. In November it was announced that the Greek state would “save” (again) Piraeus Bank through the Hellenic Financial Stability Fund. It was emphasized, however, that if the state “saves” this bank, this would be at a loss of 2 billion euros of public money. As analysts were pointing out, explaining the complicated procedure for this scheme, the biggest problem is that the State would have to buy Piraeus Bank stocks at more than six times its current price! This would result in the state losing 9/10 of the money it would invest in the bank.

DieM25 had published an extensive and detailed analysis on the whole bank bailout scheme from the beginning of the crisis, till then, with the case of Piraeus bank (here.) It’s interesting to see what they write on how and why the “new bankruptcy of Piraeus Bank was put on track since 2015”:

“The tool was a new form of a loan, which could be turned into stocks (contingent–convertible) in case it was not possible to be paid back. For example, in October 2015, Piraeus Bank took a 2 billion euros loan from the State (the State, of course, borrowed this money from the troika), under this condition: If Piraeus Bank could not repay it (or if the troika/ECB would not let it repay it because it would have run out of reserves), the loan would immediately be transformed into state stocks.

Where is the “trick’? In three parts of the contract:

1. The initial loan was given with a forbidding 8% interest rate, so it was secured that Piraeus Bank could not repay it.

2. Now that Piraeus Bank cannot repay, it is transformed into stocks, the State has to buy these stocks at a pre-agreed price MORE-THAN-SIX-TIMES than their value in the stock exchange (while a private investor would give today less than a euro for a Piraeus stock, the State -this is you, tax-payer- is obliged to give 6 euros per stock!)

3. Even now that the State’s share of Piraeus Bank rises from 26.4% to 61.3%, the State -that’s you- does not acquire control of Piraeus Bank (since these stocks are exempted from voting rights in the bank’s shareholders General Assembly!”

However, things continued as planned by those in power. The Greek state “saved” Piraeus bank, and the bank came under State control in January, through the Hellenic Financial Stability Fund. The HFSF then increased its shares from 26.4% to 61.3%. Although the Bank was nationalized, the government did not touch the Bank’s management board.

The planned re-privatization of Piraeus Bank came even earlier than expected, with this share capital increase. The three cornerstone investors acquired for 380 million euros 26.74% of the Bank. The Hellenic Financial Stability Fund share decreased from 61.35% to 27%. In any case, according to reports, the terms of share capital increase -abolishing old shareholders rights and 95.2% dilution- had pre-defined the outcome: a successful share capital increase to the detriment of the Greek state, which lost 3 billion euros. In a nutshell, the HFSF returned to its pre-share capital increase share, having meanwhile lost 3 billion.

And this was yet another story on how Greece became cash-strapped and debt-ridden - and a guarantee that it will continue on this path for decades if still in the hands of these politicians.
 


 

Read.
 

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Greece is preparing for a tourist influx - but is it ready?

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Three Ways to Sail Greece’s Photogenic Saronic Isles This Summer: The Aegean and Ionian Seas may be more renowned among world travelers, but it’s a trip to the Saronic Gulf that will show the real meaning of Greek luxury.
 

Plan Ahead.
 

Athens & Epidaurus Festival with live performances 1 June - 10 October: The annual Athens and Epidaurus Festival will reopen to live audiences on June 1, with over 80 productions scheduled. You can find the whole program here and plan ahead.

Visit the exhibitions of the National Gallery in its renovated building at 50 Vassileos Konstantinou Street, in Athens, which opened to the public on Friday, May 14, 2021. It is worth it!  Opening hours: Daily: 10.00 – 18.00, Wednesday: 10.00 – 21.00, Tuesday: closed.

And remember: Open-air cinemas are opening their doors again this Friday 21 May. Visit one and enjoy!

 

And don’t forget!

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