Greece’s half-miracle

by Paul Taylor

Politico
October 21, 2019

A little-noticed semi-miracle has occurred in Greece.

After a devastating decade of depression and three wrenching austerity programs, the ancestral home of European democracy has emerged with its democratic institutions intact, social cohesion improbably resilient, its budget in surplus and extremists of both the far left and far right in retreat.

The new center-right government of Prime Minister Kyriakos Mitsotakis hit the ground running after winning a July election, bringing a younger generation of internationally minded, business-friendly technocrats into office rather than the clientelist, nationalist old guard of his New Democracy party.

Mitsotakis has kickstarted long stalled privatizations and is racing around Europe trying to build confidence so Athens can loosen its fiscal straitjacket and attract desperately needed investment.

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Greece sets out ambitious budget based on faster growth

by Kerin Hope

Financial Times
October 7, 2019

Greece revealed an ambitious budget for next year that assumes growth will accelerate to 2.8 per cent from a projected 2.0 per cent this year, driven by higher investment inflows and cuts in corporate and personal income tax.

Theodoros Skylakakis, deputy finance minister, said on Monday the centre-right government was also committed to achieving a 3.5 per cent primary budget surplus next year — before making debt repayments — as agreed with Greece’s international creditors.

Greece will hit the 3.5 per cent surplus target this year, but faces a projected fiscal gap of about €800m in 2020, according to EU monitoring officials visiting Athens last week.

Mr Skylakakis gave reassurances the government will find enough additional measures to close the gap before the budget is presented to the European Commission on Friday.

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In Lesbos’s Moria camp, I see what happens when a child loses all hope

by Jules Montague

Guardian
October 6, 2019

Ayesha is nine years old. As her father lays her down gently on a mattress at the clinic, the only perceptible sign of life is the slow movement of her ribcage as she breathes in and out. She otherwise remains almost motionless, in stark contrast to the other children who run around this Médecins Sans Frontières (MSF) paediatric clinic by Moria camp.

For two weeks now, Ayesha has not opened her eyes. She has not spoken. She has not walked. She has what the mental health team believe could be one of the first cases of resignation syndrome it has seen here.

I’m in Lesbos researching the psychological effects of trauma in these children who have often fled violent conflict in their home countries, only to arrive at a squalid camp where conditions are chaotic and inhumane. I quickly realise that Ayesha’s state embodies what can happen when a child loses all hope.

Resignation syndrome represents a state of extreme withdrawal that can last for months or even years and occurs in the context of severe psychological trauma. Hundreds of cases have been seen in Swedish refugee and asylum-seeking children, with others reported at Australia’s offshore immigration detention centre on Nauru. These children simply close their eyes and stop speaking, eating and drinking, their muscles wasting away. Children who were perfectly well weeks before need to be dressed in nappies and tube-fed. The prognosis is uncertain, but those who do recover often only do so when they and their family reach a place of stability, especially if their residency status becomes secure.

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Can Kyriakos Mitsotakis ensure the Greek economy starts growing again?

Economist
October 3, 2019

The airport at Hellinikon, a few miles south of Athens, closed in 2001. Planes belonging to Greece’s now-defunct national carrier still litter the runway. Nearby a stadium built for the Olympics in 2004 gently crumbles. In the distance, a marina borders the glistening Aegean. In 2011, when Greece was in the throes of a sovereign-debt crisis, the government put the site, which is three times as large as Monaco, up for sale. In 2014 it was snapped up by a consortium that planned to build homes, hotels and a casino. At an expected cost of some €8bn ($8.7bn), it was Greece’s largest investment project.

Five years on, ground has yet to be broken. When Syriza, a left-wing party, formed the government in 2015, it reopened the terms of the sale. Ambivalent ministers held up licences. The authorities demanded numerous archaeological surveys. Locals sued. Apart from boats docking in the marina and the occasional security guard on patrol, the site now lies desolate.

Officials from the imf and European Union who flew into Athens’s new airport in September are thus not short of examples of the difficulties of doing business in Greece. When the sovereign-debt crisis struck they bailed the country out on condition that it enact deep fiscal cuts and far-reaching regulatory reforms. Last year the eu struck a debt-relief deal, allowing Greece to exit its third and final bail-out, despite a public-debt burden of 180% of gdp. It required Greece to continue with reforms while hitting eye-watering targets for the primary-budget surplus (that is, before interest payments) of 3.5% until 2022, and then 2.2%, on average, all the way to 2060. In return it offered some interest-rate relief and extended the maturity of some loans.

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