As background, Pierrakakis noted that 1.5% annual growth for Greece was insufficient given that Greece is bound by the last memorandum to maintain a surplus target of 4.5% of GDP over the medium term. She needed 4%. Greece had required 3 bail-out packages to the one apiece for Cyprus and Ireland. There were opportunity costs to this, and Greece had to catch up.
Turning to the challenges, the first was a) demography. Greece’s population in 2011 was 11.1 million. This had declined to 10.7 million, and was still declining. There were more births than deaths, and sizeable emigration: approximately 450,000 emigrated, a large part of which concerns young and educated Greeks. Overall Greece was likely to lose 2 million people by mid-century. This had consequences for pensions and economic growth. There was also youth unemployment and over-reliance on family. Immigration policy needed to be rethought.Climate change (b) meant that by mid-century Greece would have 15-20 extra days of heat wave per annum, a 20-50 cm increase in sea levels, a 3.5% loss of land surface and a consequent loss of 2% in GDP. Emerging Technologies (the 4th industrial revolution=c) would mean job losses. Greece was lower than the EU average in terms of expenditure on education, and in the lowest spot on life-long learning.
In terms of (d) social capital, the key word was trust. Trust in others in Greece (except within the family) was the lowest in the EU: trust in institutions was low, with the general exceptions of the armed forces and the police. Asked whether they agreed that most people were trustworthy, only 8.4% of Greeks did (compared with 60.1% in Sweden). Unfortunately trust was a predictor for economic growth.
Pierrakakis pointed to possible solutions which were also opportunities: a) care for the elderly, immigration, family policy, targeted social policy; b)full scale adaptation, green energy; c) investing in skills, life-long education; d)institutional reform, e-government.
In answer to questions, he added the following points. The main problem for the Greek tax authorities was evasion by SMEs, the main difficulty being sheer numbers: this was being tackled. As regards the cruise industry, the abolition of cabotage, as required by the IMF, was not accompanied by an increase in numbers, quite the contrary, due to external forces. The answer was to insist on home-porting, with cruises/tours beginning and ending in Greece. On d) above, he agreed that institutional reform had been attempted many times; the answer was probably to build a process which would lead to reform, beginning with more openness: not one thing but a number of small things. Top down worked best in the short term, bottom up in the long term.
He ended with a development which he presented as promising for Greece's future. Polls suggested that people in Greece were becoming more liberal in the economic sense: the previous preference for big state/big taxes over small state/small taxes had been reversed over the past three years.
David Madden (St Antony's College, Oxford)