Saturday, January 23, 2016

A Surprise For 2016?

"I believe 2016 will be the year that Greece will surprise the world economic community," Alexis Tsipras declared in Davos. Could he turn out to be right?

Well, I suppose he meant 'surprise' in a positive way. And, yes, he could turn out to be right. Providing, of course, his government remains stable throughout the year.

I have no hard facts to support my position but I cannot ignore what happened in 2015. By all standards, Greece fell into political and economic chaos in 2015, at least during the first half of the year. In those days, it was clear to everyone that the small primary surplus of 2014 would evaporate and turn into a mega primary deficit in 2015, and that a small projected 2015 GDP growth would turn into a GDP decline to the tune of 3-4%. I do not recall any more positive projections.

And yet, 2015 did not turn out negative at all. The current account reached an all-time high and there WAS a primary surplus, not a small one at that and much larger than in 2014. I would go so far as to say that the figures for 2015 defy everything that happened during the year.

Which brings me to 2016. There seems to be some hidden resilience in the Greek economy which the naked eye does not see at first glance. And the statistics don't seem to catch it, either. And perhaps after nearly 6 years of crisis, of continuous decline, Greeks have become accustomed to that new level and begin building on it instead of only complaining about it. Perhaps more energies are really being put to better use now.

Of course everything could change quickly. The government could fall over the pension reform and political chaos could return. Grexit could happen. We've been through all that. BUT: if all of that were not to happen, I think there is a fair fighting chance that Greece will indeed surprise the world economic community in 2016.


  1. It's hard to beat your logic. If all the Greek problems vanish like dew on a summers's morning, then 2016 is going to be a good year.

  2. Mr. Kastner,

    I like how you try to find the good out of everything. I also admire your objective attitude on how you see things and especially in the last articles. As for the "stupid" comment by schauble it pissed me off even though i believe tsipras to be a nitwit. phrase no phrase quote no quote, schauble does not have bill clinton's charism to say something like that and not offend.

    Regardless of everything, right now the greek society is a boiling pressure cooker and someone is going to blow the lid off. There are two major points of the Memoradum coming up. Pension reform, which i will believe Tsipras will pass and the new tax law for farmers and free lancer professions(laywers,doctors, plumbers etc...)This will not pass with tsipras.

    There are forces against reform and they are constantly painted as an invasion of Greece. In some aspects it is an invasion, but as i have stated in the past instead of calling all this austerity austerity,it should be called reform. Ask any greek and they all agree we need reform. Call it memoradum or austerity suddenly we are rebellions. Reform with honest discussion and openingless. Say things as they are and addresssing issues in the open to solve problems. Unfortunately this will not happen and the people behind the scenes will pul the strings for respective results to come or not come out. The result will be more suffering for us common people.

    I do not see tsipras lasting till this summer. Mitsotakis will come and i think a large coalition will be formed to pass the last major reforms that need to be made, meanwhile push through the last privatizations.


  3. Schengen, Asylum system, capital controls, NPL's, pension reform, budget 2016-2018 and foreign investments. Yes this is going to be a positive year, if somebody else pay for it.

  4. I don't think the year of 2016 is going to be famous for Greek economy, it is going to be famous for the multitude of excuses for the failure of Syriza's policies. When policies failed it was normal to start a war against a small unknown country. For ideological reasons Syriza do not have that option, historically it also proved unwise, Greece was usually trounced and the greater powers had to sort it out afterwards. Fortunately there are other ways to create imagined enemies, Syriza master those ways.
    There is the ever present villain, the Quadriga, and every respectable Greek news media can find a famous economist or politician who will support Syriza's accusations. To quote a recent interview with Noam Chomsky in Greek Reporter.
    "The Greek crises continues unabated and the country's international creditors are demanding constantly additional reforms of the kind that no democratic government anywhere else in Europe would be able to implement. In some cases, in fact, their demands for more reforms are not accompanied by specific measures, giving the impression that what is going on is nothing more than a display of brutal sadism towards the Greek people".
    Don't blame the language on Chomsky, it was not his answer but the reporters question. The reporter round it off nicely with: "What are your views on this matter".
    Or Independent Balkan News Agency's rhetoric question: "What about the 1 million refugees that are not considered eligible for Europe and are stuck in Greece". Or their statement: "Greeks have been living with legal or not so legal immigrants for thee last 20 years. There were more than 3 million of them before the bankruptcy".
    Germany used to take the brunt of it but lately it has spread to the whole EU. There are the odd Danes who will cut off the fingers of migrants to confiscate their wedding band and the Austrians who will return to their bad habits and make a concentration camp of 300.000 migrants in Athens. The Belgium's rather simplify it, they recommend the Greeks to drown the migrants.
    No lack of excuses here, and each can pick their own villains and victims. The villains being villains, the victims can of cause claim their moral superiority. The victims, being only humans, can also project onto the villains, all the things they are incapable of recognizing in themselves, the things they demonize according to their particular interest.The splinter in your brother's eye?

    1. Talking about blinded eyes,YOU certainly seem to have picked your own villains!
      As for mixing superiority with victimhood,absolutely nobody does it better than Germans!

  5. The Greek media have also cast their hero(s) in this Greek play. They are the citizens of the south-east Greek islands, who with their "Christ-like behavior has shown filotimo and filoxenia", they have therefore been suggested for the Nobel peace award.
    The only one of these islands I am familiar with is Lesvos, nice people, 90000 permanent residents, 15000 tourist beds. A place where people are experts in arranging shelter, food and local transport for a large contingent of tourists during the summer. It is also the place where the first of the 5 hot-spots has been crated, it is able to register the roughly 2000 migrants passing through daily. Most are still sleeping rough and their food preparation is rather primitive, but it is getting better according to government officials.

  6. The pope has announced that if the Greek people from the islands get the Nobel Prize then he will pre-mortem canonize the citizens of Sicily.

  7. The Mafia has announced that it is long overdue.