Wednesday, February 1, 2012

Greece on her way to self-sufficiency?

The head of the Greek farmers' union said that Greece could be 98% self-sufficent if she made the most of her capacity to produce food. That is wonderful news!

Specifically, he said: “We have to stop undermining Greek agricultural production and terrorizing people about not having enough to eat if the country goes bankrupt. We can surpass self-sufficiency, create new wealth and support the country.”

Well, how about that! Someone is undermining Greek agricultural production! Now, who could that be? The Germans, perhaps?

Here is a country whose historical economic roots are in agriculture; which has tremendous competitive advantages (climate, etc.) in agriculture; which should dominate Central European supermarkets with its agricultural products; and --- it is not making the most of that!!!

KISS stands for "keep it simple, stupid!" There is a lot of talk about possible new industries which could be built up in Greece. Maybe yes, maybe no. How about starting with basics? Like making the most of what one has already got? And instead of exporting agricultural products in bulk to Italy so that Italy can keep the margin for refining them, that value added could just as well be generated in Greece.

Now that may require Greeks to make a little effort to sell their products offshore.

Welcome to the real world of international trade!


  1. How's water availability for all that agriculture? I am no expert on this, but Greece always seemed a bit dry when I visited. That might limit the type and amount of produce grown there. Of course there is technology like greenhouses, drip irrigation..., but this you find elsewhere too.

    1. Curlywurly

      There is always a balance between using water and having the soil that makes the best use of the water you pour on it.

      Modern farming techniques think only of the first; however with sound agricultural practises the soils can be encouraged to be more water retentive. This has the side benefit of allowing plants to grow better and with fewer inputs such as pesticides and fertilizer.

      In the case of Greece where a lot of its soil is relatively poor, gentle composting techniques will improve the soil immensely without harming the quality of the produce. I am thinking here of the experience of French wine growers who found that the over-use of artificial fertilizers yielded grapes that had lost any individual character. Those who started using compost and other soil-generating methods - though naturally with caution for the soils you need to grow grapes are necessarily poor - yielded grapes that began to show their original character again. It meant that they could again resume traditional wine making techniques instead of "artificially" using special yeasts and suchlike to bring about the hoped for flavour from the grapes made using the chemical fertilizers.

  2. The link to eKathimerini is badly formed and gives an Error 404. This is the correct link

    I've heard of companies exporting Greek food to Germany and Bulgaria and then importing the same products in the same boxes with Produce of Greece labels back into Greece.

    Why would they do that - my guess is they do it to avoid paying taxes and/or to obtain subsidies. But the comaponies I'm thinking of are not German or Bulgarian, they are Greek companies.

  3. Canutely - thanks for the feedback. I hope I could correct it. You seem to be technical; I am not...

    Regarding Greek agriculture, one has to bear in mind that huge amounts of EU grants flow there. I recently read that over 70 BN EUR of grants had flowed into Greece since she joined the EU. I don't have the figures but much of that must have gone into agriculture. If you read my post about Petros Markaris, he says that much of those grants never landed where they should have. One of the jokes by Greeks about Greece goes as follows: there is not enough Greek territory to provide space for all the olive trees whose plantation the EU subsidized...

    Greek prices are said to have appreciated against, say, Germany by about 40% since joining the Euro. So, obviously, the margins for the Greek exporters, already small because of bulk to begin with, shrunk even further. There have been many articles over the last year stating that Greek farmers lost interest in exporting because of that.

    Why Greeks would export and re-import again beats my imagination. Obviously, there is some trick to that. Possibly some connection with refunds of VAT?

    On the availability of Greek agricultural products: go to a Greek laiki (small market) and you wish that all of those products would be available at your local supermarket in Central Europe.

    1. Yes I did read Petros Markaris's article and I recall his comments regarding CAP subsidies. But I doubt that Greece is alone in misplacing CAP money - and nor is Europe, some of the shenanigans in the US with AgSubs might even make Greek farmer blush.

    2. Probably. My point was only that, if anything was limiting Greek agricultural output, it was the Greeks themselves. Obviously, Greek farmers would be much more motivated to produce if there were a cheaper local currency and much greater demand from offshore because of that. But I simply cannot understand why the Greek agricultural sector could not be as competitive as those of other countries in the South.