Eight years after nearing economic collapse, Athens attracts global giants

Athens, in the darkest days of Greek debt and economic collapse, was a desolate place.

Towering cranes were frozen in aspic on unfinished buildings. Paving stones lifted by protesters and hurled at police are scattered in the streets. Cars were on fire in central Syntagma Square. Every spare inch of wall space was covered in graffiti, and the country’s educated elite, including financially struggling medics, fled abroad.

In February 2012, some 20,000 citizens were homeless and more than 20 percent of the shops in the historic center of Athens were abandoned.

Politics was inflammatory. The country’s hipster motorcycling minister Yanis Varoufakis toured EU TV studios demanding forgiveness for Greece’s £240bn mountain of debt as Brussels and the International Monetary Fund (IMF) sought to punish the country for transgressing the rules of the eurozone.

The yield on Greek government bonds reached an astonishing 44 percent in 2012. The crisis peaked in 2015 when the country needed a bailout.

No one could have imagined that less than ten years later Greece would rise like a phoenix from the ashes and become the fastest growing economy in Europe. Or that the New Democracy party, led by Harvard-educated Prime Minister Kyriakos Mitsotakis, could boast enough performance and economic success to win this month’s election despite damaging scandals.

Although his party received the most votes, Mitsotakis still lacks a majority – although a new vote in June will try to achieve this.

Mitsotakis’s popularity seemed to have been dealt a serious blow by a wiretapping scandal involving politicians, the media and the security services. He was also blamed for a train crash in February that killed 57 people.

Despite such setbacks, Mitsotakis has managed to endear himself to contentious citizens and has also re-established relations with Brussels.

The previous government of the left-wing Syriza party was so alienated from Brussels and its brutal policies of austerity and job destruction, which wiped out 25 percent of national production, that it seemed inevitable that the country would be forced out of the eurozone. .

The thick Greek recovery is a parable of our times. The country has been driven back to the land of the living by strong government support, a fantastic tourism revival, booming exports and growing investor confidence.

Since the pandemic, 250,000 jobs have been created, bringing the unemployment rate down to 11.6 percent – ​​the lowest level in 12 years. In 2012, it reached an alarming 24.4 percent, nearly a quarter of the workforce. Greece’s debt crisis, which began in 2010, required three international bailouts.

But the pandemic gave Athens a chance to regroup. Armed with generous post-pandemic aid from Brussels and some smart and creative economic thinking by the New Democracy government, life in Greece has been transformed.

Key to the recovery is the massive surge in domestic and foreign investment, an impressive 44 percent increase since mid-2019 when the current government took office. Among the global giants drawn to Greece are Microsoft and Pfizer.

Much needs to be resolved. The debt-to-GDP ratio stands at a biblical level of 177 percent. The Paris-based OECD says much needs to be done to reduce high poverty rates, improve gender equality and restore a budget surplus.

Nevertheless, the EU’s weakest link has achieved a return to a level of prosperity that no one thought possible just a few years ago.