Wednesday, July 5, 2023

Adieu Alexis Tsipras

Alexis Tsipras arrived on Greece's political stage with bravado. That was in 2012. A few days ago he left that stage with a whimper.

Back in early 2012, I asked my Greek friends who Alexis Tsipras was. They invariably told me that he was bad news. A communist revolutionary who had spent his entire life organizing protests and even destructive activities. And that he was married to a communist. As a great admirer of Che Guevara, they had christened their son Ernesto.

In short, I definitely started with a strong bias against Alexis Tsipras.

Then I made my first observations of Alexis Tsipras in action before TV cameras and with a microphone. This prompted me to write my first of later many articles about Tsipras, dated May 12, 2012. It was titled "Cheers for Alexis Tsipras!"

Needless to say, I immediately recognized his communicative talent: "Alexis Tsipras strikes me like a youthful, energetic and, above all, charismatic individual. The type of natural leader who can easily get people to follow him. Those are the traits which any leader who is hopeful of pulling Greece out of the present mess must have. I do not see those traits with any other Greek politician at this time." There are leaders who lead with passion and there are leaders who lead with brains. Only seldom are there leaders who can do both. Tsipras struck me like a leader who could not do both but who could effectively employ passions. Thus, my conclusion of this article was that "having said all this, I think what Mr. Tsipras needs more than anything else is good advisors."

I listed 10 points which competent advisors should recommend to Tsipras and I even stated that "if he (Tsipras) accepts such advice, I could even envisage recommending to vote for him."

Tsipras' greatest failure was to chose the wrong advisor(s). In those days, the German weekly Der Spiegel put Tsipras on its cover with the question "Is this the most dangerous man in Europe?" Yanis Varoufakis, the chosen premier advisor, set out on a crusade to show the world that he could be an even more dangerous man. 

Varoufakis was (and still is) a gifted seducer who was looking for a target to use as a trampoline for personal glory and gain. I can see why Tsipras fell for him. Here was a slick cosmopolitan with intellectual brilliance, supreme eloquence in Greek and English and a wide network of other intellectuals around the globe. The international media were eager to have him display his messianic messages and quotable quotes.

On a rare occasion of honest self-recognition, Varoufakis had stated at an April 2012 conference in April 2012 "until this crisis erupted, I used to be a fairly decent second rate economist. The implosion of my country bestowed upon me the dubious honor and title of being a first class Greek economist." I am fairly certain that Tsipras had already recognized by that time that he had bet on the wrong guy, but it was too late. He could (not yet) extricate himself from the magic of this man. 

There is one scene with Alexis Tsipras which I think displayed more than any other the complexity of the man: in the evening of Sunday, July 5, 2015, two-thirds of Greeks were in public ecstasy about the outcome of the referendum. Tsipras was not one of the celebrators even though one would have expected him to be the greatest celebrator of all. Varoufakis later wrote that, that evening, he found Tsipras in no celebratory mood at all. On the contrary, he seemed subdued. Perhaps he was thinking of the Greek proverb that "any fool can throw a stone into the sea, but once he does, a hundred wise men can't pull it out!"

It speaks for Tsipras the man that after his gigantic kolotoumba (somersault), he could achieve re-election a couple of months later. However, the Tsipras thereafter was not the same Tsipras as before.

Alexis Tsipras had begun to enjoy the 'good life'. He found that life was much more pleasant when one is liked by the global elite instead of hated. He switched from being the 'Greek firebrand' to being 'the nice young Greek'. Madame Merkel displayed almost motherly care when she joined Tsipras on a stage. Bill Clinton extended Tsipras fatherly help when he had trouble with English in an interview. Every summit photo showed a smiling group with a smiling Tsipras in the middle. 

The global elite had good reason to like Tsipras. After all, he accepted every measure, however brutal and/or nonsensical, which the Troika put before him. In the process, he put his compatriots through an unnecessarily painful adjustment and an hitherto unheard of level of austerity. His goal was to 'exit the program' and he accomplished that with flying colors. No non-leftist government could have gotten away with such 'reforms' because people like Tsipras would have started a rebellion. The irony is that, by doing that, Tsipras unwittingly set the stage for his successor to rebuild after such destruction.

During the campaign for the 2019 election, my sense was that the 'European elite' almost would have preferred Alexis Tsipras to win. Even Angela Merkel did not come out forcefully in support of her political colleague Kyriakos Mitsotakis. After all, Tsipras was a Prime Minister whom they felt that they could control and Mitsotakis was a question mark at the time. Still, Tsipras lost and Mitsotakis won but the irony is that without Tsipras' 'destruction', Mitsotakis would not have found it so easy to 'rebuild'. 

Alexis Tsipras strikes me as a somewhat tragic figure. With the right advisors, he could have gone down into history as the man who transformed Greece into a solid social-democratic country with consistent and effective reforms. As it was, the opposite happened. Greece today is governed by a solid center-right government with a certain emphasis on the 'right'. Quite a few things which Mitsotakis has done in his first tenure were things which, if Viktor Orban had done them, would have caused an uproar in Brussels. 

Tsipras had started out with 100% passion but borrowed the brains of the wrong people. When he realized that his passion no longer carried the day, he could no longer prove his relevance. Instead, he lost his political compass like a boat which has lost its rudder but was hoping to catch the right wave to carry it to pleasant shores. That wave never came and Tsipras could only watch how a speed boat called 'Mitsotakis' left him in its wake. 

If there is one silver lining to Tsipras' tragic then it is the fact that Varoufakis was voted out of parliament before Tsipras resigned. That was some bit of justice, after all. 

On the day after the July 2015 referendum (and the day after the resignation of Yanis Varoufakis), I wrote a satirical article which has registered the largest number of readers (almost 13.000) of all the 1.357 articles which I have posted so far. It was intended to be the story of how Varoufakis manipulated Tsipras by pretending to be his greatest supporter only to stab him in the back later on. It was titled: "To: Alexis. From: Yanis. Subject: Thank you!"

Friday, June 9, 2023

Greece - Living Beyond Its Means Again?

In a commentary published in the Ekathimerini on June 6, the well-known British journalist Hugo Dixon stated that "Greece is living beyond its means again." This prompted me to think because I have made similar arguments in this blog.

What does "living beyond one's means" really mean? That depends...

It is easy to define it on the level of a person or family. If a person (or family) has more expenses than income, he would appear to be living beyond his means. But that is not necessarily so. If that person has wealth like savings, he would not be living beyond his means because savings are part of his means. Correctly speaking, that person would be living off his substance.

If that person (or family) has no wealth, he needs to cover the hole with debt and that would clearly be living beyond his means because he is using other people's savings to pay for his expenses.

In both cases, one has to look at the composition of the expenses. If the expenses include a large portion of investment which will generate income in the future, the person (or family) may currently live beyond his means but he is investing into the future, which is good. The opposite is the case when the expenses are entirely for consumption.

At the level of the state, the analysis becomes more complicated because it is difficult to assess the wealth of a state (for example: real estate and other tangible assets). At the same time, a state may have a budget deficit not because the expenses are too high but, instead, because the tax revenues are far too low because of tax cheating. So while it may appear that the state is living beyond its means, it is not an expense problem but a revenue problem which could be solved through more efficient tax collection.

The ultimate level of living beyond one's means is the national level. The level of the national economy and of the country as a whole. And this brings me to the subject on which I have focused since I started this blog 13 years ago - the national current account.

The current account measures the revenues which a national economy generates outside its borders compared with the expenses which it has outside its borders. If the current account registers a deficit, it means that the national economy is living off the savings of other countries. On a cross-border basis, the national economy (i. e. the country) is living beyond its means. Those savings of other countries can take the form of foreign debt, foreign investment or foreign grants. Typically, it is the foreign debt which represents the bulk of the savings of other countries. 

My intensive readings about the history of modern Greece have suggested, that - since the foundation of modern Greece 200 years ago - there have only been very few years where Greece had a current account surplus. Put differently, Greece has a long history of living beyond its means on a cross-border basis. 

When the financial crisis erupted in 2010, the voluntary flow of foreign savings into Greece stopped suddenly. There was only an 'involuntary flow' from official institutions and the Troika made sure that this involuntary flow covered only the bare minimum of necessities. For once, Greece was forced to more or less live within its means. The economic pain for Greeks was dramatic (it was only 'more or less' living within its means because, despite all the austerity, Greece did not have one single year of a current account surplus during this austerity).

Have things improved under the Mitsotakis government?

With Mitsotakis's assumption of power, the voluntary flow of other countries' savings into Greece returned. It returned in huge amounts and it was necessary because the current account deficit exploded under Mitsotakis and it was approaching pre-crisis levels. On a cross-border basis, this was (and still is) clearly an enormous living beyond its means for Greece. It could only happen because of the enormous voluntary inflow of external debt, because of substantially increased foreign investment and because of substantial funding from the EU Recovery Fund. 

The most important point of interest: during Mitsotakis first tenure, the external debt of Greece increased by about 130 BEUR! That is more than 30 BEUR per year! And that is at least the level of external debt growth prior to the crisis.

Hugo Dixon stated that Greece's current account deficit was about 10% of GDP last year. Adjusted for the spike in energy prices, it was still about 6%. Those are VERY high figures. Red flags should typically show up when the current account deficit passes 3% of GDP. The pre-crisis peak in Greece's current account deficit was close to 15% but that included much more interest expense than Greece is having today.

Does that spell trouble for Greece's future?

That depends. Just like in the above examples of a person or family, it depends on what the money is used for. If it is primarily used for prudent investments into the future, it is actually very good news. However, it must be remembered that Greece's insolvency of 2010 was not à priori caused by huge amounts of debt accumulated in prior years but, rather, because that debt was primarily spent on consumption. Had it been spent primarily on investment, there would not have been an insolvency in 2010. 

So, the conclusion is very simple. If Greece now spends the enormous inflow of the savings of other countries primarily on prudent investments, a Golden Age lies ahead of the country. If the consumption spree of the 2000's is repeated, the next insolvency is already in the cards.

The verdict on the above is still out.

Monday, March 13, 2023

Greece - No Country For Young Arrogance

In an August 2022 essay by Alexander Clapp, published in the NYT, I found the following quote which I have cited many times since then:

"It is, rather, the unsustainable contradiction between the country Mr. Mitsotakis insists on pitching abroad — an unimpeachably democratic state whose respect for the rule of law and liberal bona fides ought to be rewarded with corporate investments and tourism dollars — and the one he actually presides over.“

Prime Minister Mitsotakis is an excellent salesman of his country and he certainly has sold me on it. It is only in the last few months that some doubtful clouds have shown up on the horizon. To sum it up in one word: arrogance. I had given 3 examples thereof in the above-linked article. 

Still, I felt quite uncomfortable voicing these crescent doubts because I was afraid that in the midst of Mr. Mitsotakis' success, they might be considered sacrilegeous. So much more was I surprised to read in today's Ekathimerini a commentary by Alexis Papachelas who started out by saying:

"This is not an easy country; not by a long chalk. A part of it looks and may also be European. Another is deeply Balkan and looks, in fact, a lot like what the international literature would call a “failed state.” The struggle between the two is constant and sometimes it is even violent. Anyone who is ambitious or crazy enough to govern it has to deal with this struggle between good, European Greece and Greece of yesteryear, between what it could be and what it is at its worst."

So far so good. Anyone who has followed the scandal around the recent train accident can agree with that. But then Papachelas continued (the emphasis is mine):

"The current prime minister has a very clear picture of where the country should be headed. In some areas, the country has made progress, and quite a lot of it. But this government has also made mistakes. No one can change the state alone, nor can they promise to change Greece 0.5 to Greece 2.0 in just a few years. Such undertakings require humility, and what the government is paying for right now is overselling its managerial capabilities. It settled for many of the bad habits of bad Greece and in some instances acted as if it owned the country. Some of the examples are painful and make people mad. The condition of our hospitals is a case in point. Greece is changing, but important areas are being left behind."

That is exactly the concern I have voiced in recent months. I see no Greek politician around who could represent the country internationally as well as Mr. Mitsotakis does ("pitching his country") and I think it is extremely important for Greece's domestic success to be represented well internationally. That has to do with credibility. If Mr. Mitsotakis were to stumble domestically because of cockiness or arrogance, it would do enormous harm to Greece internationally. And that, of course, would affect Greece's domestic success.

Sunday, March 5, 2023

It's A Short Putt From Greece-Praising To Greece-Bashing

In the last few years, since Mr. Mitsotakis became Prime Minister, my Greek friends have often criticized me for being idealistically (and unrealistically) bullish about Greece. In short: I had predicted a Golden Age for Greece under only one proviso - that the tsunami of foreign funds coming into Greece in the last 3-4 years and expected to come in in the next few years is spent wisely. Frankly, I was not alone in that assessment. My sense is that most foreign observers had a similar impression.

It only took one dramatic scandal, the train accident, to turn Greece-praising into Greece-bashing. Above all, Greece-bashing on the part of Greeks themselves. The foreign media which I follow have not really engaged in any Greece-bashing.

The Greek blog GreekReporter has now published an article titled "The countless times Greece was convicted by EU courts." The article really provides for some astonishing reading.

EU Court of Justice Convictions

2015: Conviction for violating working hours in hospitals and in general.

2016: Conviction for constant violation of EU waste disposal rules.

2016: Conviction for undermining free movement of capital.

2018: Conviction for failing to recover state aid to Ellinika Nafpigeia.

2019: Conviction for failing to provide support for persons with inabilities.

2019: Conviction for failing to recover state aid to Larco.

2020: Conviction for failing to comply with conservation standards.

2023: Condemnation of Athens over its poor air quality and for failing to take the necessary measures.

European Court of Human Rights

"Greece’s convictions at the European Court of Human Rights (ECHR) amount to 948, according to the Greek judge of the Court Yiannis Ktistakis. During a recent briefing of the Parliamentary Committee for the Monitoring of the Decisions of the Court of Human Rights, Ktistakis attributed the low position of Greece in this field to our country’s non-compliance with the sentencing decisions and its inability to eliminate the hotbeds that multiply human rights violations. As he said, a telling comparison can be made with Belgium, a country that has many similarities with Greece, and not only in terms of population. “Belgium has only 285 convictions compared to Greece’s 948 and only 234 pending appeals today as we speak, compared to Greece’s 2,214. In the numbers, Belgium in the last decade 2011-2021, paid 1,745,909 euros for compensation awarded by the European Court, while Greece paid six times more, 28,256,237 euros,” he explained."

I wish someone would comment on the above!

Friday, March 3, 2023

Greek Train Accident - The Culprit Was Found And Put Into Jail! Or Was He Not The Culprit?

The tragic train accident and the discussions around it have reminded me of a NYT commentator who recently observed in an article "the unsustainable contradiction between the country Mr. Mitsotakis insists on pitching abroad and the one he actually presides over.“

Well, it seems the country which he presides over (its institutions, its governance throughout the hierarchies, its administration and control, etc.) is indeed quite different from the country which Mr. Mitsotakis pitches abroad. Within days of the accident, all sorts of revelations reached the public about inefficiencies and incompetencies in the public sector. Mind you, not only at OSE (the Greek train infrastructure company) but in the public sector in general!

This just goes to prove, in my mind, how important Mr. Mitsotakis is for the image which Greece is now, after 4 years of his government, enjoying internationally. Yes, he is overselling his country. No thinking person would accept that a state which was not too long ago described as a "failed state" would, within only 10 years, become a near-perfect state. 

The question is whether Greece is really changing or whether the perceived change is only a PR-job of Mr. Mitsotakis. My sense is that in the private sector, there are indeed many positive signals of important changes and improvements. I cannot say much about the public sector because I know very little about the public sector. Or rather, I didn't know much about the public sector until a few days ago.

Now, I have read about the unbelievable scandal of OSE (that, I believe, is the company where the last PASOK finance minister, George Papakonstantinou, said that it would be cheaper for the state to transport all OSE's passengers by taxi than by trains). I read that everyone knew all along that Greece's railways were the most dangerous ones in Europe and that even the EU Commission was concerned about that. I read that the EU transferred about 700 MEUR for the betterment of OSE in recent years. I read that there have been multiple written warnings about the potential risk or a major accident; and, finally, I read that no one in a position to implement improvements really cared.

But yes, the master of a small train station had to be put in jail immediately because he committed such a grave human error. And yes, even Mr. Mitsotakis knew immediately that 'human error' was the cause of the accident (somehow suggesting that the culprit had already been found and put in jail). Why Mr. Mitsotakis bothered to announce the formation of an expert commission to look into possible causes of the accident is not quite understandable under that light.

For someone like myself, who has fallen for Mr. Mitsotakis' pitches, this is a great disappointment. Yes, I had started to believe that the Greek state was transforming from 'failed state' to 'near-perfect state' in a hurry. It seems I was wrong. 

So where do we go from here? How do we solve this problem? Well, certainly not by declaring the station manager as the culprit and sentencing him to life in jail and to declare the matter as closed. That, to me, would be about the most unethical and immoral strategy. Not to mention the fact that it would not work. 

The government now has the unique opportunity to show that they mean business when they talk about modernizing the Greek state. That they won't shy away from hot potatoes; that they will not fear any taboos. It is not sufficient for Mr. Mitsotakis to state that "we will do everything in our power that such accidents will not happen again." Those are words. Actions speak a lot louder than words.

If this huge tragedy does not provoke tough actions and improvements, measurable actions and improvements, then eventually Mr. Mitsotakis may be asked by foreigners why the country he presides over is so different from the one he pitches - and that would be the end of Mr. Mitsotakis' credibility.

And without credibility, you can achieve nothing!

Monday, February 27, 2023

Kostas Karamanlis - Greece's Gravedigger?

Kostas Karamanlis, Greece's Prime Minister from 2004-09 and, since then, a member of the Greek Parliament recently announced that he would not run again in the upcoming election, thereby "completing his parliamentary career." This announcement re-awakened discussion about the Karamanlis government's role in and responsibility for Greece financial crisis which broke out in 2009 and culminated with the signing of the first Memorandum in May 2010. 

In a lengthy analysis, the blog Macropolis described "How Greece sleepwalked off a cliff in 2009, in black and white." The facts they present there are totally convincing: if ever a government had intended to take an entire country down the tube in grandiose style, no one could have done it better than the Karamanlis government from 2004-09. Incompetence was compounded by irresponsibility. In short: Kostas Karamanlis was the gravedigger of Greece.

The conservative Ekathimerini could not let that stand. Since it is hard to debate the facts, they counter-argued on a philosophical level in a short opinion piece: "It is easy, hypocritical and unfair to target this or that former PM as solely responsible. It is much more difficult to root out from politicians’ and society’s DNA the components that can easily bring us back to the brink of bankruptcy at some point in the future."

Be that as it may, the past is the past and a discussion about it is only warranted if relevant lessons for the future can be gained from it. Macropolis argues that a most important lesson for Greece should be derived from the past, namely: if you want to avoid crises in the future, you should have a good and accurate understanding of what caused the crisis of the past. On this issue, Macropolis passes harsh judgment about Greece's political class and Greek society in general. To quote:

"All these years, Greeks have been fed a diet of half-truths, conspiracy theories and witch-hunts that mainly aimed at deflecting the attention and discouraging any serious debate about what happened in 2009. All sorts of ridiculous claims have been thrown around, from a global conspiracy to steal the country’s “rich natural resources” to scapegoating the head of the statistical office even though he hadn’t even started the job when the events unfolded."

This inability to deal rationally with the past bodes ill for Greece's future, according to Macropolis. They put the focus on 2 individuals who can/will make a difference, or not: Kyriakos Mitsotakis and Alexis Tsipras. Both could have and should have, in the last decade, lead Greece though the catharsis which, according to Macropolis, is necessary - but they didn't. And if they cannot accomplish that going forward, Greece's prospects look grim, according to Macropolis. To quote:

"Nearly a decade later, the two leading figures from Greece’s political class have been unable to lead Greece through the catharsis that is necessary. Despite representing the younger generation, they seem unable to enlighten voters and both are trapped by political miscalculations and internal party dynamics. Alexis Tsipras’s strategy to gain power was to focus on a different enemy, while placing the Karamanlis era and the man himself well away from the firing line. Kyriakos Mitsotakis, meanwhile, cannot amass the courage to accept his party’s clear responsibility without qualifying it with weak excuses that seek to deflect blame. If these are the two men who are supposed to take Greece into a new era, leaving behind the trauma of the crisis, the country’s prospects look grim."

Since I ran this blog very actively from 2011-18, I tested my memory to see how I would come out on the above issues and below is my summary.

While I totally agree that the Karamanlis government, with its totally irresponsible financial conduct, put the final nails in the coffin of Greece's sudden stop, I think more context is necessary. It all started  in 1981 when Greece joined the EU and Andreas Papandreou assumed power. Papandreou introduced a deadly mix of a bloated and inefficient welfare state with stifling intervention and overregulation of the private sector. EU membership, at the same time, increased Greece's "creditworthiness" and foreign funds flowed into Greece to pay for these excesses. Furthermore, EU membership brought along the "Four Freedoms" (free movement of products, capital, services and people) and the Greek economy was definitely not prepared for at least two out of these four (free movement of products and capital). 

According to Prof. Aristides Hatzis, the political legacy of Pasok was even more devastating in the long-term since its political success transformed New Democracy into a poor photocopy of Pasok. From 1981 to 2009 both parties mainly offered populism, cronyism, statism, nepotism, protectionism, and paternalism. The net result was the outcome of a disastrous competition between the parties to offer patronage, welfare populism, and predatory statism to their constituencies. The Spraos Report of 1997 warned of a collapse of the Greek pension system. The head of the Greek Trade Union Confederation reacted: "The Spraos Report suggests that the Greek Pension System will collapse by 2010. Well, before the Greek Pension System collapses, the Greek State will collapse". Well, as it turned out, both happened (but the Spraos Report was forgotten). 

In short, the turning point in Greece's economic and political development was 1981 and already within the following decade, one could see that Greece had embarked on a path which would potentially lead to disaster. In October 1993, a young professor at an Australian university described the Greek economy as being in 'terminal decline' and he expressed great pessimism that this could ever be reversed. His name was Yanis Varoufakis.

And then came the Euro! Whereas the common currency was expected to impose constraints on any Greek profligacy, the opposite happened. Whereas EU politicians thought that a 'no bail-out clause' would constrain financial markets, the opposite happened. The politicians bluffed the financial markets ("there will be no bail-out's") and the financial markets called the bluff. In the end, the politicians blinked first (and almost immediately). 

All of the above gave Greece almost a full decade (the 2000's) of literally unlimited foreign credit and money flowed into Greece like there was no tomorrow. The money was used to finance budget deficits, current account deficits and to provide funding for Greek banks which, in turn, pushed consumer credits to the Greek public. In short, the bulk of the money was used for consumption. From 2001-10, the accumulated current account deficit was 197 BEUR (!). Imports during that time were 446 BEUR (!). Foreign debt had increased from 121 BEUR to 404 BEUR (!). 

Kostas Karamanlis would have had to have the leadership profile of his uncle Konstantinos Karamanlis (who returned Greece to democracy after the junta) in order to have at least a chance to slow down this development, not to mention stopping or even reversing it. And that might not have worked because Greek politics and society in general in the late 2000's had been pervaded by 30 years of irrational conduct. 

On one point, Kostas Karamanlis deserves credit. If a Greek leader had decided, in the late 2000's, to bring this mad, 30-year odyssey to an end by pushing the country down the tube and if, in true Greek drama fashion, he was going to do that in grandiose style, no one could have done that better than Kostas Karamanlis.

Friday, February 24, 2023

Greece's Current Account Deficit - Forebodings Of The Next Sovereign Debt Crisis?

I wish I had been wrong when, back on July 29 of last year, I projected a dramatic current account deficit for 2022. Alas, I wasn't: Greece posted a current account deficit for 2022 of 20,1 BEUR which is a phenomenal deficit. It also represents about 10% of Greece's GDP, which is also a phenomenal percentage!

There are indeed some good news. Revenues from abroad increased from 68,4 BEUR in 2014 (which had been the best current account year in the past) to 112,7 BEUR in 2022. A phenomenal increase! Record exports and record tourism revenues accounted for that.

But it wouldn't be Greece if expenses abroad would not have increased substantially faster: from 69,6 BEUR in 2014 to 132,8 BEUR in 2022. Imports more than doubled since 2014!

The net result is a deterioration in the current account from a deficit of l,1 BEUR in 2014 to a deficit of 20,1 BEUR in 2022. Notwithstanding all the positive news which surround Greece's performance these days, this deterioration in the current account is a dramatic development!


Why does the current account matter so much? Because the current account reflects whether a national economy, cross-borderwise, is living beyond its means or not. Whether it is spending more money outside its borders than it earns outside its borders. And if it is spending more money outside its borders than it earns outside its borders, it needs to obtain funding from outside its borders.

Greece currently has no difficulties raising funding from outside its borders. On one hand, Greece will continue to receive billions of Euros from the EU Recovery Fund. On the other hand, Greece has, once again, become a very attractive place for investments. Capital markets seem to have, once again, fallen in love with Greece. Furthermore, Greece has very low debt service until the early 2030's.

Still, a current account deficit is a current account deficit and a current account deficit of 10% of GDP (or worse) is dramatic. If that situation can not be improved, the next dramatic sovereign debt crisis of Greece is already in the calendar. Not this year, not next year. Not even this decade. But if the current account problem cannot be solved, the next bankruptcy of Greece can be expected for the mid-2030's or shortly thereafter.