Global orientation, productivity and realistic management of the National Strategic Development Plan (NSDP). The challenges for 2007

Like every year, 2007 will be full of challenges for the Greek economy. During this year enterprises will be faced with a great need to adapt to the new business environment.

The basic – and perhaps only – challenge for the country’s economy in 2007 is the achievement of high growth rates and the concurrent improvement of the country’s international competitiveness. Up until today, the situation was reversed, and this constitutes one of the most difficult questions regarding the course of the Greek economy.

Traditionally, the Greek economy is characterised by the low coverage of its imports by its exports. The study of the relevant index’ tendency over the years presents a deterioration, which has negative effects on the course of our trade balance. In order to reduce the gap between imports and exports, it is necessary to improve the domestic business environment for the purpose of facilitating business activities.

However, which are the main components of the business environment that require immediate improvement?
1. bureaucracy in dealings between enterprises and the state,
2. the labour relations regime,
3. the legislative framework on entrepreneurship, and
4. the current tax regime.

The next challenge that will have to be faced in 2007 is related to productivity, which constitutes a basic factor of domestic and international competitiveness. Over the last years, investments in Greece have been increasing, while at the same time a high degree of productivity has been maintained. However, a significant factor that contributes to the improvement of productivity, namely the technological modernisation of enterprises, has not yet acquired a self-preserving dynamism. Productivity, on the basis of man hours, is practically half of the EU-15 average.

Before I conclude, I would like to refer to the great - perhaps the greatest, especially for regional development – challenge of 2007: this concerns the actions to be taken in the next Programming Period (National Strategic Reference Framework 2007–2013). The greatest challenge is to avoid the loss of valuable resources for the region from the total budget of the NSRF. We hope that the decisions that have been made will remedy the weaknesses of the 2000-2006 period, the most important of which were:
The existence of many managing authorities, which on the one hand led to the fragmentation of interventions, and on the other hand caused coordination problems.
The project control system was bureaucratic, often leading to clientelism; it was also highly dispersed and this resulted in huge operating costs.
The involvement of more than two agencies in the policy-making process in one sector. This underlined problems in the coordination of agencies, which resulted in serious problems and complications in the implementation of development policies.
The programmes were fragmented into small projects, of questionable development prospects; these projects, in most cases, did not constitute integrated development interventions.
Especially with regard to public works, the situation is well-known: multiple fragmentations of small projects, which were neither completed within the set time-frame, nor within the estimated budget, and the quality of which was not suitable. On the other hand, those that were completed, were either not functional, or were put into action after long delays, perhaps due to the lack of permits or of provisions for the coverage of their operating expenses.
The huge bureaucracy due to the large number of beneficiaries leads to enormous administrative costs and the loss of momentum and financial resources in terms of its management, without any results.

In the end, I believe that we have the opportunity to learn from the management deficiencies that existed during the previous programming period. I also believe that as a nation we have come to realise that any loss of resources from now on is a luxury we cannot afford. Therefore I am optimistic that we can hope for the better utilisation of Community funds from this year until 2013 for the benefit of the country’s development...