Common Market's newest member holds its breath
Christina Salcelazidis, a blond Greek who heads up her own export company, sold 10,000 cotton T-shirts to Britain in 1980. This year, however, she will likely sell 300,000 shirts.
The giant leap in sales started in January when Greece joined the European Community, the 10th member. T-shirts and other Greek goods will flow more freely into the other EC nations as quotas and tariffs are lowered by 1986. And Greece will gain the benefit of EC development aid, which this first year amounts to a net gain of $694,000 (39 million drachmas).
For President Constantine Caramanlis, the entry into the EC is a personal triumph of his long-held belief that Greece, as the birthplace of Western civilization, "belongs to the West." Greek workers and consumers, however, so far have suspended judgment on the perplexing problems of placing a developing nation of 10 million into the developed economies of 260 million Europeans.
"There are problems of adjustment -- like a family moving from one house to anv other," says President Caramanlis in an interview. "But Greece is already reaping the benefits."
Without entry, Greece faced stiff competition from other non-EC Mediterranean countries in its food exports to Europe, mainly West Germany. Now, says Premier George Rallis, "WE are much more competitive with Israel and North Africa," he says.
"Without the EC, we would have to rely only on Greek possibilities, and those are not sufficient," he stated.
If voters do not foresee advantages in a Greek place in the European choir, they may voice their disapproval in the coming election. Hopes of lower prices for imports of high-quality Western goods, such as cars and appliances, have not materialized. Farmers have been helped with higher price supports, which only raises consumer's costs. Pasok, the opposition party, promises to ask for a referendum on entry, or at least try for renegotiation of the EC pact -- an idea that raises the hair on the necks of Eurocrats.
The ruling NEw Democracy party tried to warm up Greeks for entry with such television jingles as "You are in the EC, learn about EC," and gave assurances that big Western companies would not gobble up small firms.
"The question is whether we can increase the purchasing power of Greeks to pay for the increased prices of imported products," says Efthymios Christodoulou , governor of the National Bank of Greece. The trouble for other EC nations will be Greece's "hidden" protectionism, the kind that a creative bureaucracy can put in the way of importers.
Few EC products or investors have come into Gree pending the election outcome. But by 1986, says John Gourzis, head of the Greek Personnel Management Association, "this country will be in stiff competition. And we haven't done anything at all to get ready. It's a real tragedy."
YEt so far, the effect is more political than economic. With Western Europe on its side, Greece is in a better bargaining position against Turkish claims on airspace, ocean resources, and Cyrpus. And the Greek military knows that a repeat of a junta dictatorship would cause the Ec to expel Greece -- and cut off a possible economic bonanza.
When Italy joined the EC, it expected benefits to agriculture, but industry ended up getting a boost. And EC competition, as thought, did not force a major upscaling of Italian firms, as many Greeks expect for their country. "Nobody can conceive in all its details the impact of going into the EC," says Ioannis Boutos, a ranking New Democracy party member. "But if we did not join, we would have had no broader economic union."
Reshaping the EC's agricultural policy toward southern crops is Greece's first goal as a member. But it is also worried over Spain's likely entry in a few years, opening tough farm competition. "We will follow the negotiation with Spain and be able to look after the interest of the Greek peasant," Premier Rallis says. "We don't want to impose conditions and we don't want to blackmail. But we want to declare our objections," he says, adding that he favors Spain's entry.
Textiles, Greece's most important industry, with $400 million in exports, has begun to bite into the french market, forcing threats of protectionism. Still, Asian competition and higher Greek wages have slowed Greece's textile boom. And the final lifting of all import restrictions for products into Greece by 1986 will certainly shuffle the cards for the nation's largest industry.
More automation and a shift to more ready-made clothing will be needed. Foreign investors, such as Nike, may move in. As the only cotton producers in the EC, Greece stands to gain in textiles when the transition is over. Still, without changes "textiles will suffer," says import agent Constantine M. Kotrotsos of C. G. Lazarakis SA. (A longer-term threat to textiles lies in Turkey's possible EC entry by the turn of the century.)
Right now, says Nicolas Alectoridis, president of the Hellenic Organization of Small and Medium-Scale Industries and Handicrafts, "most Greek small businesses could not withstand European competition."
"It's not more know-how that we need. It's the Greek character. We have to train children that if you want something, you have to work for it. greeks today want more money and to work less," he adds.
One small step is more cooperation between small companies. In the Athens area, for instance, a nonprofit cooperative known as GARMEC was formed last year among three dozen small ready-made-clothing firms. GARMEC can more easily market exports and pool investments for new technology. A similar group has started in Thesssaloniki. But such mutual-aid societies are still rare. "It is difficult to convince Greeks to become part of a larger group," Mr. Alectoridis says. "They think they will not be owners anymore. They put pride before profits."
Joining larger economic units is not new to Greece. A key characteristic of classical Greece was a body of city-states in close contact but with separate identities. And in the 7th century BC, Greek traders from ten cities of Asia Minor set up an "emporion" at the port city of Naukratis on the Nile delta, a purely economic settlement where exchanges between different societies could be controlled.
Herodotus, however, the ancient historian, offered an other opinion: "Greece always has poverty for a mate," he stated. "[The greek] never thrive better than when they are compelled to get everything from themselves and their industry."