New York.- By Apostolos Zoupaniotis
The continued implementation of the reforms by the Greek government and the political stability are key to the return of investors in Greece, top hedge fund managers John Paulson and Wilbur Ross told audience during a panel discussion at the 17th Capital Link investing in Greece Forum.
The forum took place on Monday in Manhattan, with over one thousand top managers of hedge funds, bankers, investors, businessmen, along with members of the Greek American Community.
The Greek government was represented by the Alternate Minister for Tourism Elena Kountoura and Deputy Foreign Minister Dimitris Mardas. Prime Minister Alexis Tsipras and Minister of the Economy George Stathakis have sent video messages.
Interventions were made by the representatives of all four institutions, Declan Costello – European Commission, Nicola Giammarioli – European Stability Mechanism, Rasmus Rüffer – European Central Bank and Delia Velculescu – International Monetary Fund,
They all stressed that significant progress has been made in the contacts and negotiations with the Greek government and they communicated a message of optimism about the prospects of the Greek economy, provided that it will comply with the program and that there will be smooth cooperation between the institutions and the Greek government.
Prime Minister Alexis Tsipras addressed the delegates of the 17th Annual Capital Link Forum in New York via a televised message.
“I am happy with the great opportunity to present prospects of the Greek Economy and the strategic planning to fulfill them. A year since Greek people authorized government to challenge harsh austerity programs. We negotiated hard asking for true reforms that enhance growth and do not shrink our economy’s potential. We achieved a compromising agreement that contains for the first time lower fiscal targets, more European investment funds and a clear commitment for debt relief. Those three factors combined are a crucial stepping stones to restart our economy and tackle the huge unemployment which threatens our social cohesion” he said.
“The elections of last September reaffirmed the people’s mandate to us to apply the program and regain our access to the international markets in 2016 and therefore regain our independence. In this stable political environment we take advantage of widespread consensus to push through a series of drastic reforms and changes that our society needs. In this respect we simplify our tax system; we combat tax evasion that create a stable and investment friendly environment. We put together an anti-bureaucratic legal and operational framework for investments; we enact radical public administration reforms combating corruption and favoring meritocracy and evaluation. We create synergies between the public and the private sector. We take measures to reform our judicial system; we upgrade and modernize bankruptcy law. Within a challenging international environment, we managed to recapitalize the systemic banks mainly by attracting private investors. Their response is a reward for our efforts and the message that we are on track with respect to our commitments.
The Greek GDP is expected to return to positive growth rates in the second half of 2016. Meanwhile, the impending lifting of waiver and the expected integration of Greek bonds by the ECB into QE in 2016 will give us the stimulus to get back in the capital markets again. We are optimistic that we will succeed and will achieve access to the capital markets for both the public and the private sector.
The geostrategic position of Greece elevates us to energy and logistics transit hub. In energy, developments such as pipelines, gas and green energy are expected to attract high quality investments. Logistic and infrastructure projects are important for Greece and a series of public sector infrastructure investments will start immediately. Funding opportunities for public and private investments through the so-called Juncker Plan do exist but we are also open to attracting new investment capital. Tourism has been developing for three years in a row establishing Greece as a top quality tourist destination worldwide. The upgrading of existing infrastructure and urban planning open the opportunity for new investments in luxury, medical and other alternative forms of tourism. The world dominance of the Greek owned fleet is a clear proof of what the Greek people are capable to do if they find the necessary means and invest in their skills.
While we recognize our weaknesses, we try to transform them into strengths and opportunities. We exploit our comparative advantages. So we are inviting you to trust Greece. We invite you to trust us” concluded Tsipras.
MINISTER GEORGE STATHAKIS
The Minister of Economy, Development and Tourism George Stathakis, in his message presented the government’s roadmap for the return of the Greek economy to growth. He also spoke about incentives for investments that will be implemented from 2016.
“I am sorry for not being with you in New York, but the new agreement of last Friday with the institutions has to go through the Greek Parliament this week. Let me share with you the basic roadmap of this government for returning economy back to growth.
After last summer’s agreement with our international lenders, there are some major milestones that will put on track the Greek economy. The first milestone is the two successive agreements that we have fulfilled already, concerning the implementation of the program. The second milestone is the recapitalization of the banks, that has also been very successful and that provides financial stability for the Greek banking sector, which will be integrated into the European Banking System from January the 1st. The third milestone is the first review of the program to be completed by next February which will provide long term stability to the fiscal issues of the Greek economy. And the fourth milestone is the re-profiling of the Greek debt after 2020-2022, the long term Greek dept, which will remove any long term danger of a Grexit or any other similar threat.
The Greek government that came into power after this September’s elections has provided political stability in Greece and is working in order to sustain political stability in a region of high turbulence.
The major issue, after the completion of those milestones, is obviously the return to growth. The Greek economy during 2015, despite capital controls, performed quite well. Initial predictions after capital controls, were talking about 2.4-4% of recession rate. In reality, at the end of the year recession rates will be less than 1%, which indicates that there is a strong cyclical growth element in the Greek economy which will make certain that it will return to growth most likely in the second semester of next year.
This growth potential has to be strengthened. The government has been focusing on major initiatives so as to make sure that this growth is sustainable: There is a new investment grant legislation, including foreign direct investment to be in place by January the 1st. There is a new public procurement system, following the lines of the European Commission, that will provide a much more open and competitive system. There is an initiative for the establishment of a development fund that will mobilize European financial tools and direct resources to the much needed financing of SMEs in Greece.
There are also major initiatives in continuing the policies of opening up specific markets, professions, and facilitating the licensing process.
Taking into account all these initiatives, Greek economy may see next year as promising for its return to growth.
Last but not least, the great advantage of the Greek economy, except the obvious sectors such as shipping, tourism, areas of manufacturing, agribusiness etc., is its human capital: one out of two young Greeks is a university graduate. In effect this is the greatest advantage of all and it’s up to us to mobilize all available resources to turn this economy into a sustainable growth path.”
MINISTER OF TOURISM
In a speech delivered at the forum, Alt. Minister of Economy, Development & Tourism, Elena Kountoura briefed the audience on the prospects of tourism and investment possibilities in the tourist sector.
“I am very pleased to join you here in the heart of the global business community and among such a distinguished audience to ELABORATE on why to invest in the Greek tourism market and why to invest NOW.
The Greek government has recently renewed its power in office for the next four years and along has also renewed its strong commitment to RESTRUCTURE and REFORM the Greek economy, to restore the MARKETS’ CONFIDENCE and to create a solid, prosperous future. The road to growth is not long anymore, and it’s a very STABLE one.
Tourism has EMERGED as the key-point to growth. It’s the leading sector with a 20 % contribution to the national GDP and has performed with incredible RESILIENCE in times of crisis, achieving growth in all recent years.
2015 was our record – breaking year: Greece was chosen by more than 25.5 million tourists worldwide, who spent directly more than 14.5 billion euros, reflecting an annual 5-7 % rate of growth in arrivals and receipts, rates which are higher than the global average.
Our four-year strategy plan reflects our vision to make Greece one of the top five most popular destinations in the world, with the relevant growth in international arrivals and receipts. This is our national effort with a certain action plan in cooperation with the 13 Regions and the private sector in order to achieve these goals in the years to come.
We extend the season in popular and new destinations, while we intensify our presence to new markets of high-end tourists. Our regulatory and legal framework is being updated to boost investment and offer diverse and complex products of thematic interest all around Greece.
Greece is now one the world’s best LOTS for tourism investments.
In its latest country report, The World Travel & Tourism Council PROJECTS an annual growth of 4.7 % in tourism investments in Greece, for the next ten years.
Major funds mostly from Europe, the United States, and the Middle East, as well as international investors are eager to enter this booming market, looking at concrete opportunities in tourism and real estate.
About half of the currently running projects are being financed by foreign companies and most of them reflect a shift in demand for complex and integrated tourism resorts.
Our REGULATORY framework is in the direction of developing condo hotels, luxury and boutique hotels, as well as facilities for seniors, families and tourists of multigenerational travel. Spas and wellness centers, sports and recreation facilities, medical resorts and theme parks are on prime demand, with priority to quality, sustainability and environmental protection, as our biggest investment in the future.
I am not here to tell you how to do business. You know better than anyone how to spot a great opportunity. I am here to support your business efforts and help you in establishing a network so that you can take advantage of the opportunities offered by the timeless brand name “Greece”.
Greece competes as a major global destination, being the largest and most diverse complex of islands, with one of the longest coastlines in the world (16.000 km), with the cleanest and safest blue waters in the world.
According to the latest surveys, we are number 5 among the world’s top ten cruise destinations for luxury travelers, even above the Caribbean and Fiji.
Greece connects to the world with scheduled direct flights to hundreds of international airports all year round via the Athens airport, one of the most modern in Europe, but also from other 33 regional international and domestic airports. Just in the past few weeks international air carriers announced their 2016 program, in which they have included a larger number of flights and new destinations in Greece, making prospects even better for the next year as we continue to open new markets and reach new deals.
All new investments target a 12-month product, as the model with more sustainable and stable profit for any type of investment. Greece’s mild climate, landscape diversity, great history and culture are the basis on which we further develop conference, thermal, adventure, sports and training tourism, golf infrastructure, cultural tourism, religious tourism, gastronomy, agrotourism, sea tourism and much more.
It is our government’s strategic decision to encourage foreign direct investments. And we are very serious about it. Evidence of this commitment is the privatization of 14 Greek regional airports, which was just finalized today, by the selected German-Greek consortium, as well the sale of Astir Palace Resort which is in its last phase.
The national privatization program includes also many other opportunities for new infrastructure and for the development of public real estate assets and pieces of land.
Just in the past year, the Ministry of Economy, Development and Tourism forwarded large private-sector tourism projects, worth up to 5 billion euros, which had previously stumbled upon regulatory issues.
Enterprise Greece, the official state agency, under the supervision of the Ministry of Economy Development and Tourism, assists investors in exploring such business opportunities across the country.
A One-Stop-Shop service, established by our Ministry has already facilitated a large number of large-scale projects and we are going to introduce a new investment law, within the first two months of 2016, which applies to tourism projects as well.
Let me make this clear. We are not suggesting that Greece will become a tax paradise, but, we are one of the last unexplored paradises in the Mediterranean for hotel and tourism investments.
Your presence here today indicates you are ready to consider such opportunities as part of your own future.
I want to reassure you that our government and I personally encourage new STRATEGIC and INNOVATIVE investments that will keep the booming Greek tourism market ahead of the game.
John Paulson, President – Paulson & Co. made the following statement at the 17th Annual Capital Link Forum:
“We are encouraged by the current government’s adoption and implementation of reforms to ensure global competitiveness. Continued stability on the political front should instill confidence in the Greek recovery. We have invested in the recapitalization of the Greek banks and will consider additional investments as further progress is made.” Or more philosophically: “Greece has survived the storm. The clouds are now parting and the sun is starting to break through. Calm waters will lead to smooth sailing. The sun will once again shine over Greece.”
John Calamos Sr., Founder, CEO and Global Co-Chief Investment Officer of Calamos Investments, said he was more positive this year on the prospects of Greece, than he was a year ago.
“Rebuilding and growing the Greek economy must include several important building blocks in order to make the country one where businesses and investors can find success. A rekindled focus on Greece’s private sector development, the creation of businesses and job gains is essential. The private sector provides an environment where entrepreneurship thrives, hard work is rewarded and sustainable jobs are created. Greece should also simplify and streamline the legal, regulatory and logistical hurdles to start a business there. The process can currently take years. Data underscores the far-reaching impact that policies which encourage small business could have on the country. An improved business framework would give investors in Greece greater confidence, as well. In addition, as the government considers taxation, officials should consider a decrease in the tax rate instead of an increase. A reduction in tax rates stimulates the economy and data shows this then leads to an increase overall tax revenue. Improvements in tax collection should be undertaken, as well. Greece is fortunate to have a strong shipping industry, an educated workforce and natural beauty that is clearly an asset for tourism. Greece is the Florida of Europe, and as its economy is rebuilt, the country can become a robust business, corporate and investment destination, as well.”
Mr. Dean Metropoulos, Chairman and CEO of Metropoulos & Co. made the following statement:
“Like another small and resourceful nation, Israel, Greece is a country of entrepreneurs and a well-educated population. It also has some very natural advantages that can be developed into significant business and wealth building opportunities. Among them is tourism, energy, and agriculture. Given the educated and youthful population, technology can also thrive and be part of an international network. Where Greece can learn from the Israeli model, is that these opportunities must be framed within a business and investment friendly environment where transparency, and. a predictable and Western style legal system will attract investors that can make judgements on the merits of the investment opportunity and not be frightened off by political instability, bureaucracy and red tape. The country must also have an enforceable tax code which allows it to operate with legitimacy, certainty and fairness in meeting its public obligations and promoting its nation’s opportunities.
Mr. George M. Logothetis, Chairman and CEO of the Libra Group said:
“The recent successful recapitalisation of Greek banks goes a long way to restoring confidence among potential foreign investors in Greece and will help the wheels of commerce begin to turn. Throughout the crisis we have maintained our commitment to investment in Greece as well as to a range of social programmes that provide direct support. Our commitment remains.”