Dear chairman of the Federation of Industries of Northern Greece,
Ladies and gentlemen,
I would like to thank you, sincerely, for the invitation to your second Conference on Industrial Policy and for the opportunity given to me to present the Government’s thoughts, positions and actions on this crucial issue, on the issue of industrial policy.
I have listened very carefully to your chairman and I would like to emphasize that indeed, with its interventions in the public domain and in public speech, the FING is de facto developing, I would say, to an institutional interlocutor and a government partner in the difficult effort, but the common effort for the exit of the economy from the crisis, the exit of the country from the crisis. And I would say that this is a wish, any of your attempts to be supported. And any attempt will be supported in order to substantially upgrade your role.
Within your conference, very interesting views and concerns were heard, opinions from people who have a deep knowledge of the issues of economy and production. And I would like to try, as well, to express a holistic approach to these individual issues.
It is true, as you have rightly pointed out, that it is the second time I have been involved in a 5-month period in your Federation’s work. While almost a month ago at the Thessaloniki International Fair, I presented the government’s detailed plan for what we call, the next day following the memoranda and the special status of guardianship we have been living for seven years now in our homeland.
Also a few months ago, I found myself in one of the Regions of Northern Greece in the Region of Western Macedonia, in the context of the regional conferences that we organize for the productive reconstruction and for the construction of the thirteen sub-projects, development plans at regional level, also constitute the national development plan of our country. And of course, I had the opportunity to speck with the organizations of the region about the problems we have before us and we must work together to overcome them. And I must not forget that almost a year after the establishment of the Prime Minister’s Office in Thessaloniki, I established my regular visit to Northern Greece to have direct supervision of the current issues and to seek solutions to problems.
I have, therefore, concentrated my presence in Northern Greece not only for symbolic but for substantive reasons. Your proposal for the establishment of a “National Council of Industry” is not only positively considered, but to some extent already implemented through the channels of communication that we have developed, my colleagues and competent Ministers along with all the productive bodies of Northern Greece as well , and across the country, I would say. But to express this more schematically, what Athens is for the tertiary sector, Northern Greece is for Industry and Manufacturing.
Thessaloniki, I would admit that rightfully is the Industrial Capital of the country. The parallel upgrading of its role in attracting investment in energy, transport – and, of course, infrastructure, of course – demonstrates locally what is currently happening throughout Greece. We are in a very positive momentum for the Greek economy.
The investment interest is renewed and more intense than ever in times of the crisis. However, for us, most importantly, this year is the last one for our country to be under a memorandum, but at the same time it is, I would say, the most critical year.
The long-term recession, the high unemployment accompanied by the suffocating context of adaptation programs, have exacerbated the Greek society, the Greek economy. Now, however, it is the time to show confidence and maximum faith in our powers so that we can finally leave behind this nightmarish past of recession.
We responded to this historic challenge with a plan, which, despite the constraints of our program, creates the conditions for the transition to a new production model: modern, extroverted, collaborative, focusing on innovation and ultimately compatible with the requirements of global competition. At the same time, we fulfill the long-standing social demand for profound reforms throughout the public sphere by establishing equal treatment rules for all.
Especially in this issue, our rupture with favoritism of the past, the cliental relationships and the privileged elite was, is and will remain absolute.
Allow me at this point because I know that I am speaking to a Federation, the majority of whose members are people of true production.
They are the people of real production. Their relationship with industry is not typical.
Allow me at this point to say some truths, as I understand them.
Because in front of us, don not just lie the things we need to do. But, also, what we must not do. How to fight, to eradicate from the body of society, the economy and the state the remnants of the past that led us to the crisis.
And I refer to what I call, the dominant previous form of entrepreneurship in our country state-entrepreneurship.
The bribery, the corruption, the fake loans.
The model that the governments of yesterday created, exploited, and used, in good cooperation with certain “entrepreneurs”, in quotes, that their only investment, without any risk, of any initiative, of any productive offer, was the demotion of public state funds.
And that was one of the reasons – I would say the most important – that led us to the crisis.
But one of the aspects of corruption, the undermining of healthy competition, the frustration of excellence, which recently some people have constantly invoked, undermines eventually every concept of justice in the common sense.
On the other hand, healthy entrepreneurship is for us, and for me personally, one that can only be based on true production, true investment, highlighting the comparative advantages of the region and economy, and a manpower that works and produces under the conditions not of jungle and overexploitation, but of labour legality and wages in accordance with their contribution.
Briefly, entrepreneurship that respects the laws, respects the environment, and respects the most crucial factor in the productive process, the worker.
That does not hesitate to invest in innovation, initiative, extroversion, the most valuable capital that this country has in human resources.
This is, for us, the model of tomorrow, which can lead the country to the avenue of growth.
The model of knowledge intensity, not labour intensity.
Some people talked and continue to talk about a free economy and tell us they are supporters of the free economy, and in practice, when they were the leaders, they imposed the toughest protective model. But protectionism is not for public goods but for their people. I will give you an example known to all of you in Thessaloniki, the Thessaloniki Urban Transport Organization.
They were talking and some are still talking about free competition and present themselves as believers of free competition.
In practice, when they were governing, they applied an exceptionally privileged binding between friends and relatives to public procurement.
They spoke and still speak about free market protection and say they are believers of the free market. And when they were governing, they offered their “owns” with fake loans, subsidies, privileged contracts, leaving thousands of entrepreneurs and businesses in the twilight zone.
What we call healthy entrepreneurship.
So we were led to the crisis. So we were led to the memoranda.
That’s how we got billions in the list of tax evaders abroad, and the economy and the country bleed.
Being wealthy businessmen but bankrupt businesses.
And hurt our industrial production. Let’s have a whole exhibition with factory padlocks. The chairman of the Federation mentioned this before.
Talking about investment is easy. But to pave the way for realization, to overcome the obstacles, to promote them and to understand every day how important this is for the progress of the country, for work to return to this place, to maintain growth, is something completely different .
Consider how many years, for example, our national highways have been shut down.
Consider, how many years the tunnels were not finished here in Tempi to bring Thessaloniki closer to the rest of Greece.
The metro of Thessaloniki, the railways, the major energy projects, the Asteras of Vouliagmeni, Elliniko.
And see what effort is being made today and what results this effort has borne. Everywhere and here especially in Northern Greece.
We are not magicians, nor sorcerer apprentices. I do not want to rejoice, but I think that these two and a half years have been years of managing very difficult crises and have accumulated an experience that maybe other prime ministers have not acquired it, having done not two years but two decades.
The results appear, not the next day, in the long run, but come only through systematic effort, hard work, plan, strategy and purity in the state’s relations with entrepreneurship, the observance of legality in every case. And this in the long run is fruitful and I am sure that it will give much more in the future not only with your help but with your leading role.
The country has already entered a different time. Two and a half years ago we received the country of Grexit. Today, what I first saw here a month ago in this room that we are going through Grexit towards Grinvest, is a reality. None can conceal this. No matter some people who did not know how to complete the investments that have been lazing for years, they know very well today to give lectures.
But the most important thing is that we are entering a new era on the basis of a totally different concept. We organize the country’s future with the transition to the post-Memorandum era by focusing on growth and its fair distribution to the whole Greek people.
And today, two and a half years since we took over the governance, the data are indicative of the changes that are taking place in the positive direction, but also of a new wind is blowing, I would say, which inspires confidence abroad and at the same time allows us to be optimistic about a definitive exit from the multi-annual crisis and guardianship.
Greece, on a daily basis, with steady steps, difficult steps, changes and sets a sound basis for the next day, and that is most important.
And the international community recognizes this positive outlook for the country.
Allow me to be more specific, however, by analyzing using elements and examples, our remedial national plan and the positive results I think are tangible.
In the field of economy we have the first encouraging signs.
Recent ELSTAT figures show that the target of growth of around 2% in 2017 is an absolutely realistic goal.
Exports in the first half of 2017 increased by 18%, and this is the highest performance we have had, not in the years of the crisis but since 2001.
Indeed, they grow at a pace higher than the rate of imports, which ensures a balanced balance of payments and anticipates a gradual transition to a more outward productive model.
In any case, we have undeniably entered a recovery path and we must ensure the sustainability of this trajectory in the future.
What is left, a crucial condition, is the safe completion of the program, which passes through the timely completion of the third evaluation in order to avoid new circles of uncertainty.
But now, not only us but all sides work for this purpose. These are the clues and the image we have today. And they do so because only the benefit of all the sides from the successful and timely completion of this great adventure will be for both Europe and Greece.
The program, therefore, will end on time and it will end in a long and particularly painful period for Greece and Europe.
And we are working to lay the foundations for sustainable, rather than short-term, growth rates, and we are seeking for these rhythms to be translated into jobs in the first place. These growth rates are not only translated into numbers but visible, perceived in the everyday life of every citizen.
Allow me to express at this point some thoughts about unemployment.
The ” growth with unemployment”, that is, this growth, because there is also a possibility that we can achieve positive growth rates, even tall, without this having any reflection on the reduction of unemployment rates. We have seen this model in other countries.
“Unemployment”, which is based on the cheap labour force, ultimately generates only unsustainable profits and artificial “bubbles” without impact on the real economy and without prospect.
On the contrary, sustainable growth and the diffusion of prosperity for many presupposes protection rather than the crash of work.
On the question of unemployment, the situation we have received – you all know it – was disheartening and from the outset we took the whole weight.
Today we see some important results, although of course we still have a long way to go. When we received the unemployment was 26.5% and today it is at 21%.
Every year, unemployment in the past two and a half years is reducing by 2% on average.
While in the first catastrophic five-year period, 2010-2014 unemployment in the country grew each year by 1.5 points.
This year, up to July, 263,000 new jobs were created, a record number of 16 years.
This is an increase of 40% compared to the corresponding period of 2014.
Unemployment among young people, one of the most painful points, as well as the migration of the most important potential of Greek society, of young scientists, remains significant but has fallen by 10 points.
For two consecutive years, despite the difficult circumstances, we managed to overcome the budgetary objectives of the program we agreed with our partners. We put in order, in a word, our finances, but demanding at the same time and achieving a flexible debt agreement that in the medium term will reduce burdens on the Greek economy.
We have co-authored with our partners a roadmap for debt that guarantees its viability and emphasizes growth rather than austerity.
And of course the markets were the ones who interpreted this agreement positively and welcomed in good terms our first test run.
Upgrades of our credit rating followed, bond spreads declined dramatically, and economic confidence indicators reached the highest levels in recent years.
Domestic demand is rising, and this encourages consumer demand and encourages businesses to make productive extensions.
A record of nine years was recorded in manufacturing.
However, the share of GDP, from almost 9% today, has to reach – and we aim to reach – 15% by 2020.
According to Markit, the main PMI index recorded the strongest growth since June 2008 and reached 52.8 points in September.
The recovery of this indicator throughout 2017 is fully compatible with the positive growth rate of the economy and its strengthening over the past few months is consistent with the expectation that this rate will have accelerated, at least in the third quarter year, which implies a positive growth result close to 2%.
But why do I talk to you with numbers? Why am I mentioning them all?
Because only through growth we will be able to regain work, only through growth to the extent that it will be just as we envision it, we will be able to gradually reduce the tax rates for businesses and households and relieve society from in fact, the burden of taxation imposed on us by rescue programs, which in crisis conditions, emergency conditions, have been decided on the course of the economy.
In this direction, the drastic reforms that we have introduced into fiscal policy also begin to account for.
Reforms that everyone saw their necessity but we dared to implement them.
I am talking about e-commerce, measures to tackle smuggling of tobacco and fuel, centralization of public procurement systems and control of drug market costs, improved public procurement systems, e-invoicing in the final processing, voluntary disclosure of income and tax checks on foreign lists.
As far as the budget expenditure side is concerned, we apply a thorough audit of the spending of all ministries to ensure that public spending is as effective as possible.
Already in 2016 we have achieved savings of 10% or 300 million euros through the electronic procurement procedures.
Under conditions of recession and compression of wages, what we want is the last euro of the Greek taxpayer to catch up and return to high quality social services.
Over time, all of these changes believe we will stabilize revenue streams in public funds and help to reduce tax rates faster.
At the same time, however, I would say that all these choices, all these decisions, give a strong signal to the inertia forces that have for years maintained the black hole of the black economy and tax evasion.
The game is based on clear rules and we end with this sad situation, when honest entrepreneurs were discouraged from doing business here. And they caused this by allowing various ingenious people to take advantage of this situation.
The message is clear.
Respect for the Constitution and laws, respect for the environment not only discourages investors, but encourages healthy entrepreneurship and consolidates the country’s image with uniformity of rules and fair conditions of competition.
As I have described, these two and a half years we have tried to bring order to the country’s finances, to correct the imbalances of a twisted production model, and to implement profound reforms that for years have not progressed to this place.
Now, what is the debate for the next day? The debate on development.
Now we can put the weight with absolute priority on the issue of growth.
A growth with sustainable features, geared to the creation of new but well-paid, decent paid jobs.
This conversation is not easy. It is a difficult debate that requires the involvement and engagement of all.
The deep recession and the steep disinvestment of previous years, no doubt, has created a very negative field. In this sense, the debate on the next day of productive reconstruction and development does not start from scratch. We still have to heal wounds.
Our strategy for an immediate return to sustainable and high growth rates can only be driven by industry and manufacturing. It can only have as its main focus the dynamic redeployment of industry and manufacturing.
Your Chairman spoke about the rapid de-industrialization over 30 years, I would say. Not only in the years of the crisis. And for the rapid decline in the competitiveness of the Greek economy.
And if you want, that was one of the reasons for the crisis and bankruptcy, as many participants in your round tables have found during your conference.
Therefore, with absolute priority in manufacturing and industry, we want to shape the conditions to return to sustainable growth rates and to build on a sound basis. And this cannot be done if we do not leave behind the parasitic consumption pattern of borrowing imports, and if we do not turn to the creation of a new productive model that will emphasize the internationally tradable sectors.
Innovation and skilled human resources in the country.
For the needs of this transition, a modern and coherent industrial policy is needed, taking into account both international developments and adapting accordingly.
Our approach is therefore multilevel and consists of a targeted set of actions addressing liquidity issues, finance and investment attraction issues, energy costs, the crucial issue of debt restructuring, the crucial issue of supporting research and innovation, the crucial issue of the administration of justice and the speed at which it is awarded.
And of course the need for a gradual de-escalation of tax rates.
Allow me to mention some emblematic examples in the above direction:
The drastic intervention with the out-of-court settlement solves the pervasive link between the over-indebtedness of small and medium-sized and small businesses, and is blunted by the stagnation of the companies, the public and the banks, that is almost the entire Greek economy.
This provides a second chance for those who wish to produce but could not, with multiple benefits for paid employment, small and medium-sized entrepreneurship, public revenues, and banking stability.
Businesses can be re-eligible in the various funding programs, giving valuable glimpses to the economy and jobs.
At the same time, we are working on the Equifund from the Public Investment Program and the European Funds.
A fund that will contribute with funds to restarting regulated businesses with obvious positive consequences for workers and the economy as a whole.
Also, another important initiative. The Development Bank, which is under founding processes. A bank with the participation of public sector entities such as the Hellenic Fund for Entrepreneurship & Development, the Consignment Deposit And Loans Fund, the Green Fund, and the Enterprise Greece.
There is already consultation in all regions of the country, too, the national plan for the country’s productive reconstruction.
While the completion of the submission of 772 new investment plans in development law of 2 billion, mainly in the sectors of agro-food, industry and tourism, 610 projects are in the final stage.
New targeted financial instruments, which through leverage mobilize multiple resources of nearly 3 billion euros, such as Tep 2, Equifund, the new one “I save at home”, the infrastructure fund and the microcredit fund.
For the first time, however, in Greece, we are moving forward and creating the institutional framework to ensure the financing and support of micro-enterprises. Hundreds of thousands of very small businesses, which will have easier access to small credits, up to 15,000 euros, to start their first steps or to improve their business.
The national leg of the public investment program has grown for the second consecutive year, reaching almost 1 billion euros.
We took the first place in the absorption of the NSRF 2007-2013 funds and we were again the first to activate the new NSRF 2014-2020, managing the inflow of 11 billion euros in the Greek economy.
We signed with the European Investment Bank the biggest deal for the last 5 years, 2.4 billion for 2016 and 2 billion for 2017, and from the exploitation of the agreements with the EBRD and the Juncker plan already 2 billion euros were channeled to small and medium enterprises.
Banks reduce the burden of red loans, restrict their day-to-day dependence on the emergency liquidity facility and are ready to contribute again to financing the economy. And I believe that with the latest positive developments in our agreement with our partners on how to proceed to the planned stress test, which is no longer a cause for concern, as Greek banks are among the best recapitalized throughout the Eurozone, banks recover citizens’ confidence and, in general, the banking system recovers confidence and citizens return their deposits.
Foreign direct investment in 2016 hit a high of seven years.
Twelve Public / private partnerships contracts worth EUR 633 million were signed, while the business environment was greatly improved through the simplification of licensing, the reform of supervisory mechanisms and the integrated information system for around 30% of business activity, especially in the manufacturing and tourism.
It will soon reach this figure at 53% with expansion in the logistics and mining sectors.
Already, more than 11,000 businesses have benefited from this new licensing system.
We have drawn up the e-Commerce Code of Conduct with the participation of the largest social partners, we have moved on to the new law on attracting investors to start-ups and the improved bill for the rapid licensing of strategic investments.
In the coming months, Greece will become one of the first countries in the world, where business creation will have become a fully digitized process.
As far as Northern Greece is concerned, thanks to the very good cooperation between the Ministry of Finance, of course, the Ministry of Macedonia-Thrace, the Regions of Northern Greece, the Region of Central Macedonia, Western Macedonia and East Macedonia and Thrace, the Central Macedonia Region – we discussed today and with the regional governor – we have managed to conquer one of the first places in the absorption of the NSRF resources.
We unlocked the resources envisaged to boost entrepreneurship in the Region of Central Macedonia, amounting to some 130 million Euros, and we are stepping up a plan with a vision for the upgrading of Northern Greece, its geostrategic importance, which was an importance always associated with neighboring countries, thus upgrading the ports of Thessaloniki, Kavala, Alexandroupolis, making the region a transit hub for the wider Southeastern Mediterranean and an entry gate for the whole Euro p.
The great progress in PATHE railway and of course the railway Egnatia, a long-term project that we agreed about 20 days ago in Kavala together with my Bulgarian counterpart, which will connect Thessaloniki, Kavala and Alexandroupolis with the Black Sea, Bourgas and the Danube, with Ruse, Bulgaria. A work of breath not only for Northern Greece, but a work of breathing for the whole Balkans.
So we want Thessaloniki to become an important economic, commercial and cultural center of the entire Balkans.
This is our vision for the region. This is our vision for Thessaloniki and this prospect is worth in this city with its long history, the very important traditions.
It is not our vision to make Thessaloniki a co-operative. Our vision is to make it a strong center of the entire Balkans. And this is perhaps a different perspective and a different perception that we have for the place, for the city, for Northern Greece.
Also important are works such as Metro, which I mentioned earlier, the project for the freight center of Thessaloniki, the new school buildings in western Thessaloniki, the projects for integrated waste management, for the redevelopment of the exhibition area, between others, are works that progress and slowly change the shape of the city.
And of course I will not forget, as I speak to an audience that honors us to be present and the ambassador of the United States, the next International Exhibition of Thessaloniki in 2018 will be dedicated, it will have the honorable country of the United States of America, something which is extremely important as the TIF regains not only its great commercial and economic value but also regains a special role, an international role that contributes to our doctrine of a multidimensional and active foreign policy. And I am sure that with such intensive efforts as the ambassador, as well as the TIF-HELEXPO, the TIF will have a tremendous success in 2018, as was the case this year.
You are friends, with these thoughts I want to close.
Our country has gone through a huge crisis. A crisis that changed everything. But it is time to look ahead. Our country, despite the great problems it still has, has inexhaustible potential and needs to make use of it.
It is endowed with a great geostrategic position. It is at the center of today’s global geopolitical and economic rearrangements with comparative advantages very strong. Those that give it the meaning of an international hub of transport, energy, telecommunications, tourism, industry, shipping, but I will add education and culture. And let us not forget the importance of these intangible goods.
I believe, friends, that this is the message with which I want to conclude my speech.
I think we can. I believe that we can achieve our goals and that Greece not only come out of the advent of the memorandums, but that it can have a sustainable growth and an ever-increasing rise in the living-standards, a reduction in unemployment, an increase, if you wish, of prosperity.
It is enough to just believe and then act. Let’s go back to the forefront, recover the lost time, and inspire, if you wish, a new vision for future generations.
From our side, we have proven this. We have proven it.
We are open to dialogue, we listen and consider every different proposal. And above all, we have proven that we want to give space to the productive forces of the place, to the creative forces of the place. To develop, to advance and, of course, to these forces is what we can plan and prepare the next day. The next day, we aim at finding Greece once again strong, independent and above all fairer.
I would, therefore, like to invite you to support this effort, because it is not just about this government, it is about everyone, each one individually.
All of us have to demonstrated confidence in our own strengths, trust in the Greek economy.
I personally, with my office, here in Thessaloniki, as well as with all the relevant ministries, we have always, you know, opened our door to discuss new ideas, to discuss investments, to solve problems.
Our moves and initiatives aim to send the right signal to abroad, which will also attract international investment interest.
And I call on you to send this signal together. And I know well what I’m addressing and where I’m addressing, and that’s why I ask for it. Send the signal that we are ready to demolish permanently the bridges with a past, which has led us to the crisis.
And we also send the message that there is no return to this past and that we are building a promising future for the country. The future of a fair development. With the productive and creative forces of the country, we can succeed.
And I am certain that this has already begun to reveal to everyone. And to those who wish this and to those who do not.
We will succeed and we have already begun doing so.