Greece Relies on Foreign Aid For Badly Needed Renewal

GREEKS are painfully aware of it. And visitors realize soon enough that Greece's infrastructure, from roads to airports, trains to telecommunications, is in dire need of modernization.

Ten million visitors arrive at Athens' Hellenikon airport each year. But its outdated and overburdened facilities - and its single runway - give it more the feel of a county airstrip than an important regional airport.

In Athens, public transportation is mostly old, overcrowded, and dirty - often because of smokey buses that worsen the city's already grim atmospheric conditions. Across the country, trains are inefficient and highways inadequate. And the telephone! Placing even a local call can provide a lesson in patience.

The irony of the situation is that, as one of the European Community's poorest members, Greece is awash in EC funding to tackle its infrastructure shortcomings. After the billions of dollars in aid it has already spent here, the EC is set to invest $20 billion in Greek development between now and 1999.

Yet, while poor cousins Spain and Portugal have used the EC's special funds to launch ambitious road, rail, and communications programs, Greece has trailed behind. That the country's physical shape remains so strikingly poor after 12 years of Community membership is as much a testimony to the political intrigue and inefficiencies of the Greek system, as it is to the often-cited waste and corruption.

``Certainly there has been corruption and waste, but the main reason these projects don't get done here is the lack of coordinated planning,'' says Stalthis Chaikalis, who has covered public works for more than a decade for the Athens Sunday newspaper, To Vima. ``Greece doesn't have a modern civil-service system, and there are too many warring factions looking first to protect their interests. Getting the work done comes last.'' Project delays

There is a long list of big projects that are years late or have yet to get off the ground. The Athens subway project, first announced in 1975, did not get started until 1990. And the digging work is only now starting.

A contract for the capital's new $2 billion airport, planned for Sparta, north of the city, was to be signed in September - but the announcement of snap national elections the same day doomed the contract. The new Socialist government of Prime Minister Andreas Papandreou insists the project will go ahead, but in a different form from the private-public joint venture previously planned. Observers say the question is not whether there will be delays, but for how long.

In the meantime, a pipeline to deliver Russian natural gas is well behind schedule, stalling government plans to reduce foreign-oil dependence and urban pollution. Worsening threats of catastrophic water shortages also are discussed but fail to prompt the comprehensive water plan many observers say the country needs.

``Spain has the same long-term [water] problem, and a 20-year plan with a huge budget to address it,'' Mr. Chaikalis says. ``In Greece it's a 20-week plan, if we have that.''

The dire state of Greece's infrastructure is especially worrisome because this deeply indebted country is counting on foreign investment and tourism to get its economy moving again.

Foreign investment boomed last year, tripling from 1991 to $1 billion. But investors list antiquated telecommunications and the Byzantine public-works system as discouraging factors.

Tourism represents the country's second-biggest source of foreign-currency receipts, after EC aid. But threadbare facilities and outdated services pose a problem for this sector too, since many top-dollar tourists are trying new destinations, including Greece's arch-rival Turkey, leaving Greece to less demanding travelers. Recognizing the problem

The Socialists' October legislative victory has sent tremors through investors who worry about new project delays. Yet some observers say that the recognition of the need for infrastructure modernization is so widespread that progress over the coming decade will be swift.

``Everybody now recognizes that none of these projects can wait any longer if Greece is to compete within the EC,'' says Alexandros Kritikos, of Planet engineering consulting group in Athens. ``The style may change under the Socialists, but I suspect the priority given the big projects will remain.''

Optimistic observers say that, while the Socialists may put renewed emphasis on public control over projects, they will stick to the big highway, train, subway, airport, and telecommunications projects already programmed. Mr. Papandreou offered encouraging words in a recent policy statement to the parliament.

Optimists also say they expect the Socialists to develop a true plan for infrastructure development, rather than just a long list of projects for the EC to finance - a charge that was leveled against the previous government.

But memories of the past leave others more skeptical. ``[The Socialists] didn't start one of the big projects they announced while they were in power over the last decade [1981-89],'' Chaikalis says. ``Until we develop the organizational skills to translate plans into functioning steel and concrete, it won't matter who's drawing up the project list.''