Monday, May 27, 2013

One reason why foreigners shy away from investing in Greece!

I keep repeating undeterredly that Greece must implement an adequate economic framework to attract foreign investment and I keep getting reactions from Greek 'xenophobists' that everything would be fine in Greece if it weren't for big, bad Germany. When I dare to state that Greece, in many respects, still has the economic framework of a development country, I am often called a racist.

This NYT article focuses on how land ownership is presently handled in Greece. Here are just a few quotes:

"Greece’s land transaction records are still handwritten in ledgers, logged in by last names. No lot numbers. No clarity on boundaries or zoning. No obvious way to tell whether two people, or 10, have registered ownership of the same property". 

"Many experts cite the lack of a proper land registry as one of the biggest impediments to progress. It scares off foreign investors; makes it hard for the state to privatize its assets".

"Greece took more than $100 million from the European Union to build a registry. But after seeing what was accomplished, the European Union demanded its money back". 

"Experts say that even the Balkan states, recovering from years of Communism and civil war, are far ahead of Greece when it comes to land registries attached to zoning maps".

 "In the countryside, deeds reflect another era. Boundaries can be the 'three olive trees near the well' or the spot 'where you can hear a donkey on the path'".

"In general, experts say, Greeks are remarkably at ease with a level of irregularity when it comes to real estate".

Now, the land registry is only one, albeit it a very important one, factor in a foreigner's decision to invest in Greece. There are many, many other factors in Greece's economic framework which essentially scare foreign investors away.

I rest my case.


  1. Completely correct. And the reason for this mess in the land registry is simple: it helps to block even the slightest shift in political power at all levels. There are several other examples of the same phenomenon. The gold mine at Skouries, in Chalkidiki, is an example. Another is the peculiar hostility to building easily accessible local roads in some localities with lots of tourist traffic, like around Olympia. This is done because tourists are essentially not welcomed, as they have demands incomprehensible to the locals, like timely service. Of course in such a place non-locals owning property will simply suck all tourist custom, so we create a system that makes property transfers impossible without serious insider knowledge.
    As I have argued before the political problem in Greece is this unwillingness to even contemplate change in political influence, status level or class position (pick the phrase that better suits you, they are practically equivalent in our case)at every lavel in society. Hence the need for the big, bad German to scare people into political reform.

  2. That registry problem is only the tip of the iceberg!

    Today eKaterimini had an article on a new online tax system and while the law (for the first time?) requests citizens to report income from interest payments the minister on charge for it publicly deliberates if that information could not be obtained directly from banks.

    Such elementary questions should be settled before a new system is introduced and not as an afterthought.

    The legal system is extremely slow and inefficient etc. etc.


  3. A Greek notary defends his class:

  4. Nice quotes about Greek Property and given shairable information.