Belied only by its perennial inter-party political bickering that seems of little relevance nowadays to the outside world, Greece is plodding on as the most democratic and stable country of southeastern Europe, the Balkans and the Middle East.
Due to its location at the crossroads of East and West, not surprisingly it likes to present itself as an ‘oasis of tranquility’ in the stormy world around it. This has not only international. strategic connotations, but it suggests that Greece is safe ground for much sought-after foreign investment; that it is also an ideal regional base for foreign companies seeking a springboard into the wide opening Eastern European markets.
Its definition as an ‘oasis’ is well-earned if one considers that Greece is surrounded by countries which are either almost destitute or plagued by war or terrorism, or are far behind in the development of their economic and democratic institutions. These countries are Albania, the former Yugoslav republics, Bulgaria, Turkey and the Eastern Mediterranean Moslem states.
However, some would say that this is not a fair comparison among equals. It can be said, too, especially when compared to its partners in NATO and the European Community (EC) that Greece has major problems of its own. Indeed, the current conservative government’s economic and social austerity policies, and the ensuing turmoil resulting from the opposition’s strong reaction to them, is related to Athens’ uphill drive to meet the EC preconditions which have been set for participation as equal partner in full European integration.
The conflict between the government and the opposition socialists is mainly over the government’s decision to follow – almost irrespective of the political cost – a vigorous denationalization and an austerity program designed to lead the country out of economic stagnation and a traditionally state-dominated and heavily bureaucratic economic system. Indeed, until the recent drive to sell off state corporations, no less than 52 percent of the country’s presumably free enterprise economy was state-run.
The European Community has set tough preconditions for full Greek participation in total European unification – economic, political and monetary -by the year 1997. Set at Maastricht in December, these conditions for EC countries to join the EMU are the national debt drop to less than 60 percent of GDP, the government deficit to three or four percent of GDP, and inflation to a maximum 7 percent.
Greece, to the contrary, currently has a total debt coming to 95 percent of GDP, a deficit of 13.1 percent of GDP, and an annual inflation running at 17.8 percent.
Brussels has just concluded that Athens so far has failed to get the economy back on the road to recovery despite brave attempts by the government since being elected exactly two years ago after eight years of socialist rule. The government countered last month by disagreeing with the Community’s pessimistic conclusion.
It pointed out that inflation has already dropped from 22 to 17.8 percent since early 1990, that in the first 11 months of 1991 the current accounts deficit fell from 3.3 billion US dollars to 1.2 billion dollars, that exports rose by ten percent in dollar revenue terms in 1991 and imports fell slightly. It added that the invisible earnings from such key sectors as tourism and shipping are expected to be very high this year.
Despite the traditional inter-party bickering and a highly politicized and vociferous press, Greece’s politicians and the public are developing a more adult view of civil responsibility.
By the end of the stabilization program in 1993, government announcements insist, the balance of payments will have registered a dramatic improvement, inflation will have dropped to less than ten percent, and the budget deficit to 7.6 percent of GDP.
Whatever the hopes for the near future, it is this ‘Thatcherite’ policy which accounts for most of the controversy currently sweeping Greek politics. The government measures are noted mainly for heavier taxation, rising prices, and restrictions on income and spending. The notoriously unruly and tax-evading Greeks, who for decades have been using every trick in the book to catch up in consumer standards with their envied western partners, are not taking kindly to the fact that they are being bullied into tightening their belts. The result has been endless strikes and a shock by-election result in Athens in April, where the government witnessed a staggering 33 percent increase in the popularity of the opposition socialists.
Yet even the socialists are moving with the times. No longer are they the odd-balls of Europe as they were once regarded during the heyday of Papandreou radicalism. This is not the case with the Greek Communist Party (KKE), the remaining hardcore of which persists in its orthodox Stalinism. It supported the aborted anti-Gorbachev coup last August by the hardliners, it was officially exposed by Moscow as being one of the world’s largest recipients of covert KGB funding, and at its December congress actually reaffirmed its faith in the worldwide triumph of communism in the coming decades.
Papandreou’s followers, to the contrary, are no longer the rabid advocates of infantile third world socialism, global anti-Americanism, pro-communism and indirect pro-terrorism. Despite occasional outbursts of rhetoric, Papandreou’s socialists have moved closer in practical terms to becoming a more mature and responsible party, akin to their average European social democratic relatives. This is particularly so of those close aides who are seeking to succeed the resilient, 74-year-old leader who, against all expectations, recently survived a series of major setbacks ranging from renewed health problems to financial scandals.
Similarly, the ruling conservative party has long ago stripped itself of the ultra-rightist connections which tainted its image in the past. The country is steadily developing a healthy and stable two-party system where there is little room for extremists.
Simultaneously, and again despite the traditional inter-party bickering and a highly politicized and vociferous press which gives the surface impression of a country in constant political crisis, Greece’s politicians and the public are developing a more adult view of civil responsibility. Violence is no longer a staple feature of political life, dictatorship is a nightmare of the distant past, and left-wing terrorism has failed to make a more than skin-deep impact on the country. Consultations between party leaders and President Karamanlis, establishing consensus policies, are now relatively common.
The notoriously unruly and taxevading Greeks, are not taking kindly to the fact that they are being bullied into tightening their belts.
As for the Greek public, it is mostly too wise now to be manipulated into conflict by the petty ambitions of its political leaders. It has apparently come to realize that the real problems persisting in the country – a weak economy with high inflation and unemployment and low productivity, a cumbersome bureaucracy, petty corruption and nepotism, and poor social services and education – cannot be wished away by some wand-wielding political messiah.
Lately, these sobering influences and a greater solidarity felt at home have not only resulted from the bitter experiences of past political strife, but also from present foreign policy dangers and threats Greece perceives on its borders.
Relations with co-NATO member Turkey have always been strained, sometimes even coming close to war, since Ankara’s 1974 invasion and continuing occupation of Cyprus’ northern 40 percent. With the collapse of Eastern European communism and the new outburst of nationalism and ethnic tensions to the north, Greece now also finds itself at odds with its other neighbors – Albania, Bulgaria, and the former Yugoslav Republic of Macedonia. Indeed, Greece’s demand that the Republic abandon this name because it is seen as historically Greek and implying territorial claims against the northern part of the country has caused controversy within the EC. But it has also generated a new sense of national unity and solidarity among the public and the country’s political parties.
However, one can safely conclude that most foreign visitors and investors remain untouched by such nationalism and surface political feuding. If they are aware of developments in surrounding countries, they will probably come away with the conviction that Greece is a bridge over troubled waters.
