Analysis of the Business Condition in Greece

Petros Petropoulos A.E.B.E.

The company, presently, was founded by Petros Petropoulos in Thessaloniki in 1922. Early activities include sales of construction vehicles, rebuilding of engines and vehicles assembly.

1936 Willys-Overland

The factory was put under German control during the Axis occupation of Greece in WWII. The company resumed business after the war, and in 1948 it moved its headquarters to Athens. Rebuilding engines remained a major activity until 1953, when they greatly expanded the popularity of the diesel engine in Greece. Three year later Petropoulos made a bold move by investing in farm tractor production. However, in the 60s due to legal disputes with another tractor company over market (competition) rules, resulting in production delays that almost bankrupted the company. The company eventually abandoned production of its own tractor series and focused on engine production and truck/tractor assembly (exported to Europe and Middle East). In 1974 it engaged in developing and producing a new "smart" 4X4 truck family.

By the 80s a law was change that made farm vehicles economically attractive. Leading to the termination of production and in the 90s Petropoulos has shifted to imports of the tractor, trucks, diesel engines, trading and services retaining only a limited industrial activity becoming only a reseller.

This can be good for the business due to Greece being made up of hundreds of islands. The ports of Greece are numerous and 16 of them are international. The port of Piraeus is one of the busiest in Europe and is the main cargo port for the country. Greece has more then 140 ports that serve passengers and cargo. In November 2008, China's Cosco signed an agreement to run a part of the Port of Piraeus in a 35-year,4.5 billion-Euro deal that is slated to significantly increase the port's cargo capacity and efficiency. The waterways or shipping lanes serving Greece's mainland and islands are highly efficient and transport large quantities of passengers and cargo every year.

Along with shipping imports and export along with passengers, Greece has 45 airports-15 international state airports, 26 domestic state airports, and 4 municipal airports.Many of them, especially on the islands, primarily serve tourists and handle charter flights. Many of Greece's airports are undergoing significant infrastructure and facility upgrades, which will increase the amount of passengers and cargo being flown in, out, and around Greece.

Greece has a developed infrastructure the enables the uninterrupted implementation of most investment activities. Within the framework of holding the 2004 Olympic Games in Athens, and the investment in the following years, a number of improvements and changes in a number of areas-including the infrastructure of Greece-were materialized. The economic crisis has gotten worse since 2010, and continues today, has inevitably reduced available resources. Though private investor participation investments in strategic projects that facilitate transport, logistics, and telecommunications will continue, so the flow of goods, services, and information is carried out efficiently and cost effectively.

On January 25, 2015 a legislative election took place, election all 300 members to the Hellenic Parliament. This made economic decisions come to a stand still until after the election.

21st century depression.

Greece Unemployment Rate% of the Labor Force

Today's economy looks to be in an all time low. The election seems to be the rich, who seem to pay little tax, and the poor, who seem to not be able to get away from taxes. Businesses are suffering and workers are wondering what will happen to them.

Greece has an Investment Incentive Law that is set in place to help increase liquidity, accelerate investment procedures and ensure transparency. This Law 4146/2013 "Creation of a development Friendly Environment for Strategic and Private Investments" of the Ministry for Development, Competitiveness, Infrastructure, Transport and Networks, aims at modernizing and improving the institutional framework for private investments, subject to investment laws.

Provision of Liquidity and Acceleration of the grant disbursement procedures:
Option for 100%( increased from 50%) advance payment of the grant with letter of guarantee.
The investor may chose the preferred mix of the Investment Law benefits for investments up to 50 million Euro, to enhance the flexibility of financing for "small " and "medium" investors.
Tax-relief may be up-front, to enhance both the liquidity of companies and their viability.
Investors who apply for benefits of the Law may cover the requirement for a minimum 25% own capital by using company liquefiable assets.
Sectors of entrepreneurship to be supported through the Law are expanding.
The previous time limitation for the submission of investment plans, only in April and October, is abolished. Submissions may be made throughout the year.

Enhancing Transparency and Auditing Procedures of the Investment Law:

To enable the immediate closure of pending audits and the disbursement of outstanding installments, the Law provides for interim and final audits performed by certified private sector institutions, such as banks and accounting firms.
For Photovoltaic Parks approved for grants, in which the rated power is not to be the same as the original proposal but does not vary more than 10% than the amount approved, a special request for changing supplier or equipment is no longer required.
Due to the economic crisis, a one-year extension provided for the completion of the investment plans that have been applied for under the Investment Law from 2007 onward and have been approved.
To enhance transparency for large investment projects, the budget of projects that need to be ratified by Parliament is reduced to 50 million , form 150 million Euro.
Establishment of an independent Auditing Department of Private Investments to continuously monitor compliance with the procedures governing the grants of business plans, and to combat both delinquent and unlawful behaviors. The Department, which will report directly to the Minister for Development will also have a consulting role, since any malfunction of procedures will be identified through its findings.

Syriza

What does this mean for for Greece? SYRIZA's sudden rise to power, is comprehensible outside the context of the country's 09 dept crisis and 2010 bailout. The five years that followed are that of misery, with a GDP shrinking by 24% and unemployment rising 27%, transformed Greek politics beyond recognition. As they were still in "euphoria" of the previous decade these years hit them hard and SYRIZA in it's first week has said a few things to alarm people but are mostly signs of not use to being part of the government. Many members being academics not accustomed to the world of politics.

It is save to say that the business conditions of Greece were, in the 20s, a very great place for businesses to thrive and gain profit. Today, we see a very different condition where businesses and not producing but instead importing and reselling goods. The unemployment rate is high and workers worry about whether they will have a job by next year. All this with the notion that the new government is inexperienced may lead to more declines in the economy but it is hard to say as it is still early.

Untitled Slide

• http://www.huffingtonpost.com/2015/01/31/syriza-government-greece_n_6571258...
• http://blogs.berkeley.edu/2015/01/29/the-radical-left-has-won-the-greek-ele...
• https://www.youtube.com/watch?v=CpcM9OBWLqw
• http://en.wikipedia.org/wiki/Greek_legislative_election,_2015
• http://www.investingreece.gov.gr/default.asp?pid=17&la=1