The Deputy Minister of Foreign Affairs for Economic Diplomacy, Kostas Fragogiannis, gave an interview on “Parapolitika” radio station with journalists Andreas Papadopoulos and Kostas Papachlimintzos on 17 October 2019.
Κey points raised by the Deputy Minister:
Regarding Brexit, the Deputy Foreign Minister described it as an unfortunate development for the European Union, pointing out, however, that Greece is prepared for all contingencies, “whether this is based on a deal or no-deal Brexit, and all our agencies are on alert.”
He also noted, “When the European Community was established, we all envisioned a union and not a departure. We must not worry, though, about a hard Brexit, but we must be prepared and take the necessary steps. That’s precisely what we’re doing at the Ministry of Foreign Affairs.” Mr. Fragogiannis further mentioned both meetings that took place in Athens and Thessaloniki with the competent agencies, which were briefed on all the actions and preparations that must ensue.
“After Brexit, the UK will be a third country we will have to work with,” said the Deputy Foreign Minister, highlighting, “Many times, life has a wilder imagination that us and we must be prepared for the changes it will bring about.” He then added, “There’s always a slim opportunity hiding behind such difficulties. Those who are better prepared, who will be able to work with a third country, are the ones who will come out winners; because the UK is there, its consumers are there, the people buying our products and services are there and that’s where they will stay.”
With regard to trade in particular, Mr. Fragogiannis said, “There will be delays, tariff regimes and customs services for products to be transported from one country to the other. In Greece, around 3.6% of total Greek exports will be affected, including products such as petroleum products, sheet aluminium, clothing, food and household items.”
Referring to tourism and travel services, he mentioned, “We may experience some impact that will be due to the reduction in the real income of UK households, which, coupled with a possible rise in inflation, may lead to a weaker pound in relation to the euro, with indirect repercussions on tourism.”
On the topic of shipping, the Deputy Foreign Minister noted that Greece is pushing for inclusion of a special chapter on shipping in the future EU-UK trade agreement in the post-Brexit era, while referring to the students studying in the UK, he said that there will be an interim period.
With regard to agricultural and PDO/PGI products, he pointed out, “The protection of our geographical indications in the UK market in the case of a no-deal Brexit is a top priority for us, and we will be announcing our strategy on this issue in the upcoming weeks.” Referring to the financial sector, the Deputy Foreign Minister mentioned, “There is limited direct exposure due to the indirect impact of a hard Brexit, because there could be a deterioration in the bank financing conditions towards stricter financial conditions and potentially negative growth prospects.”
Answering to a question on Economic Diplomacy and extroversion, the Deputy Foreign Minister explained that the term “extroversion means three things:
● supporting Greek businesses that want to gain an international perspective through exports, buyouts, mergers and establishment in foreign markets,
● attracting foreign investors to Greece,
● fostering a positive climate, so as to help exporters, Greek and foreign businesses, operate well in Greece.”
With regard to the major investments that the government is seeking, he noted that Hellinikon and the Pfizer deal are under way, mentioning “There are many large businesses both in central Europe and in the USA which are interested in investing in technology, tourism, real estate and infrastructure.” Major investments, however, according to Mr Fragogiannis, do not happen in ten or twenty days; a reasonable period of time is necessary to attract, provide incentives and create the conditions to close a deal.
Upon concluding, the Deputy Foreign Minister said that he was not of the opinion that large businesses pick and choose tax relief rates among the countries where they invest. “What they need is political stability, economic growth and social cohesion. So when the institutions work well and the conditions – as well as a domestic market with its products and services – are there, then both the tax reliefs and the incentives a country has to offer count,” he said, adding, “What the government accomplished in its first 100 days in office was to create a framework that places our country on the investment hub map.”
October 17, 2019