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Ignorance alert: I'm no economist nor an European. Since Greece's economy has been in the doldrums for a while, I'm wondering why don't European powerhouses (l

Ignorance alert: I'm no economist nor an European. Since Greece's economy has been in the doldrums for a while, I'm wondering why don't European powerhouses (like Germany) move some manufacturing there? Greece is a popular tourist destination; so how come I'm not hearing of lots of outside money moving in to buy hotels, resorts, etc.?

hartator 11y ago
Corruption. It's not a coincidence that money had vanished. German manufactures will face extortion that will draw away any perks provided by low cost of living.
zaf 11y ago
> so how come I'm not hearing of lots of outside money moving in to buy hotels, resorts, etc.? In the leisure industry that'e been happening big time on the Premium level for the last 10 years and now slowly at the Luxury level. As for European/Global industrial powerhouses it's always been the red tape and government agency middle men that has been the main friction for moving in. Whats happening is that these hassles are being removed as Greece gets more in line with European regulations.
- deleted 11y ago
  [deleted]
derriz 11y ago
Greece is quite corrupt by western standards. Their previous minister for defense is serving jail time for bribery. Politics and society are based on clientism and patronage rather than rules and an independent legal system. This is why tax compliance is so low. Even the ownership of land is murky (they've spent 20 years and 100m of EU grant money attempting to build a basic land registry with little to show for the money). So without connections it's quite a hostile environment to operate a business. Edit: seems I'm getting downvoted for some reason. So here are some links: http://openeurope.org.uk/blog/reforming-greece-easier-said-done-never-ending-case-land-registry/ http://openeurope.org.uk/blog/reforming-greece-easier-said-d... http://www.nytimes.com/2013/03/05/world/europe/former-greek-defense-minister-convicted-in-corruption-case.html http://www.nytimes.com/2013/03/05/world/europe/former-greek-... http://www.transparency.org/cpi2014/results http://www.transparency.org/cpi2014/results
- grey-area 11y ago
  The current minister of finance in Germany had to resign after accepting 100,000 DM from an arms dealer, and is director of The Institution for Growth which he suggested 50B in Greek assets be transferred to. More blatant corruption would be hard to find. Yet somehow he has the chutzpah to lecture Greece on financial probity. https://www.kfw.de/KfW-Group/About-KfW/Vorstand-und-Gremien/Verwaltungsrat-und-seine-Ausschüsse/ https://www.kfw.de/KfW-Group/About-KfW/Vorstand-und-Gremien/...
  - east2west 11y ago
    I know you are being rhetorical but even New York Times would agree the Greek government is more corrupt than the German government. Some level of corruption is inevitable in every ruling class; an old Chinese saying is that pure water has no fish: no one will work in a graft-free institution. Your rhetorics is not helpful at the current critical juncture; cooler heads must prevail. It is far more important to consider whether the existing economic, financial, and political arrangement is sustainable and whether Greeks may be better off with a clean slate. A massive European aid program is necessary in any case and the current level of Greek debt is unrealistic. Why not acknowledge the facts and spend money on people to help them get back on their feet and at least reap political good-will, which is sorely lacking right now. Muddling through has not worked so far. If a fourth bailout becomes necessary, it will be a political earthquake with strategic implication for the rest of the world. God, I hope it does not come to pass.
    - peterfirefly 11y ago
      > Why not acknowledge the facts and spend money on people to help them get back on their feet and at least reap political good-will, which is sorely lacking right now. Because giving Greece more free money will not make the Greeks reform their country. Debt relief would just mean that they could borrow more money on the market and let the party continue. Debt relief (even more than the huge amounts they've already received and squandered) is very much in the cards and has been all the time, if only they would reform.
return0 11y ago
1) It's expensive. Greek industry itself has moved to the balkans, and china. Many greek businesses run through cyprus to survive (low tax). 2) laws not being enforced in places where they should. 3) lets just say, the greeks have been spoiled by a decade of easy lending and dont have the greatest work ethic. 4) Many hotel chains have been sold in the past decade. Tourism doesn't make as much as you think.

hartator 11y ago

Corruption. It's not a coincidence that money had vanished. German manufactures will face extortion that will draw away any perks provided by low cost of living.

zaf 11y ago

> so how come I'm not hearing of lots of outside money moving in to buy hotels, resorts, etc.? In the leisure industry that'e been happening big time on the Premium level for the last 10 years and now slowly at the Luxury level. As for European/Global industrial powerhouses it's always been the red tape and government agency middle men that has been the main friction for moving in. Whats happening is that these hassles are being removed as Greece gets more in line with European regulations.

deleted 11y ago
[deleted]

derriz 11y ago

Greece is quite corrupt by western standards. Their previous minister for defense is serving jail time for bribery. Politics and society are based on clientism and patronage rather than rules and an independent legal system. This is why tax compliance is so low. Even the ownership of land is murky (they've spent 20 years and 100m of EU grant money attempting to build a basic land registry with little to show for the money). So without connections it's quite a hostile environment to operate a business. Edit: seems I'm getting downvoted for some reason. So here are some links: http://openeurope.org.uk/blog/reforming-greece-easier-said-done-never-ending-case-land-registry/ http://openeurope.org.uk/blog/reforming-greece-easier-said-d... http://www.nytimes.com/2013/03/05/world/europe/former-greek-defense-minister-convicted-in-corruption-case.html http://www.nytimes.com/2013/03/05/world/europe/former-greek-... http://www.transparency.org/cpi2014/results http://www.transparency.org/cpi2014/results

grey-area 11y ago
The current minister of finance in Germany had to resign after accepting 100,000 DM from an arms dealer, and is director of The Institution for Growth which he suggested 50B in Greek assets be transferred to. More blatant corruption would be hard to find. Yet somehow he has the chutzpah to lecture Greece on financial probity. https://www.kfw.de/KfW-Group/About-KfW/Vorstand-und-Gremien/Verwaltungsrat-und-seine-Ausschüsse/ https://www.kfw.de/KfW-Group/About-KfW/Vorstand-und-Gremien/...
- east2west 11y ago
  I know you are being rhetorical but even New York Times would agree the Greek government is more corrupt than the German government. Some level of corruption is inevitable in every ruling class; an old Chinese saying is that pure water has no fish: no one will work in a graft-free institution. Your rhetorics is not helpful at the current critical juncture; cooler heads must prevail. It is far more important to consider whether the existing economic, financial, and political arrangement is sustainable and whether Greeks may be better off with a clean slate. A massive European aid program is necessary in any case and the current level of Greek debt is unrealistic. Why not acknowledge the facts and spend money on people to help them get back on their feet and at least reap political good-will, which is sorely lacking right now. Muddling through has not worked so far. If a fourth bailout becomes necessary, it will be a political earthquake with strategic implication for the rest of the world. God, I hope it does not come to pass.
  - peterfirefly 11y ago
    > Why not acknowledge the facts and spend money on people to help them get back on their feet and at least reap political good-will, which is sorely lacking right now. Because giving Greece more free money will not make the Greeks reform their country. Debt relief would just mean that they could borrow more money on the market and let the party continue. Debt relief (even more than the huge amounts they've already received and squandered) is very much in the cards and has been all the time, if only they would reform.

return0 11y ago

1) It's expensive. Greek industry itself has moved to the balkans, and china. Many greek businesses run through cyprus to survive (low tax). 2) laws not being enforced in places where they should. 3) lets just say, the greeks have been spoiled by a decade of easy lending and dont have the greatest work ethic. 4) Many hotel chains have been sold in the past decade. Tourism doesn't make as much as you think.