Greece's great fire sale.docx

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Greece's great fire saleFrom pristine beaches to palaces, entire islands and its London embassy, a nation incrisis is selling its assets, writes Harriet Alexander.

The coast at Afandou is part of the Greek government's desperate attempts to raise money by privatising its vastportfolio of state-owned assets. Photo: AA!"

By Harriet Alexander, Rhodes

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As George Georgas drives his golf buggy along the sea front the sprightly $-year-old muses on

why this is the best stretch of coast in the world.

The beach is the longest on the Greek island of /hodes 0 four miles of crystal waters flanked by

a gently sloping pebble shore. The (-hole golf course that flanks it is lined with olive trees and

wild flowers and there is scarcely a hotel or high rise in sight.

!r Georgas has played here for over )$ years. And now he thinks the government should sell it.

12e are like a bankrupt housewife forced to sell the silver to save the family1 he said. 1Greece

has no choice.1

The sale of the coast at Afandou is part of the Greek government's desperate attempts to raise

money by privatising its vast portfolio of state-owned assets 0 the largest firesale in history. &ome

3$$$$ lots are for sale ranging from pristine stretches of coast through to royal palaces

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marinas thermal baths ski resorts and entire islands. 4nly last 2ednesday bidding closed for a

stake in the state gambling company.

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4n !onday Antonis &amaras the prime minister scraped through another round of negotiations

with the Troika 0 the 56 7!8 and 5uropean ,entral %ank 0 and managed to secure payment of

the ne9t 56 . billion instalment of the bailout. %ut privatisation is a prereuisite for receiving the

bailout funds.

4n /hodes a mountainous island *$ miles long that was the mythical home of the sun god

Apollo huge chunks of prime real estate are now up for grabs. %eside the (*$-hectare Afandou

estate there is the peninsula of Prasonisi a paradise for windsurfers and the !andraki marina in

/hodes Town where the famous ,olossus a ($$ foot high statue that was one of the seven

wonders of the ancient world once stood guard over the port entrance.

/hodes is uniue in having nearly a third of its land owned by the government a legacy of being

occupied during the 7talian invasion in (;( and later having ownership of that land passed over

to Athens when it became part of the modern Greek state. "et that hasn't stopped the inspectors

from Athens fanning out across the country to see what else they could auction off.

The idea of snapping up a Greek island certainly has its appeal. 7n !arch the 5mir of


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4nassis family 0 earlier this month for a reported =#* million as a present for his +-year-old

daughter 5katerina /ybolovlev. 2hile both those sales were private it showed there was a

potentially lucrative market for chunks of scenic Greece.

!any plots are available on ,orfu including a large coastal estate which the government boasts

on its website is ne9t door to land owned by the /othschild banking dynasty.

4fficials refuse to discuss prices saying that it depends on offers and the development

proposals but the Afandou coastline is looking for an investment of (*$-*$ million euros. The

port of Poros a pretty cobbled marina in southern Greece is on the government books as is the

Athens police headuarters and the !inistry of ,ulture 0 a giant temple-like construction in the

centre of the capital. &o too are the buildings housing the ministries of health education and

>ustice. 5ven the Greek embassy in ondon's ?olland Park: yours for = million.

?owever not everyone supports the idea of so many places going under the hammer.

12e need to keep state ownership of all our assets 0 not sell them to the highest bidder1complained "iannis !ilios chief economist for the opposition &yri@a party who would prefer to

see more use of public-private partnerships rather than sales.

159perience shows that the privatisation of public goods is a very bad idea. 2ith water for

instance the uality falls but the price rises which is totally wrong. The government is very good

at finding legal formulas to work its way round supposed guarantees of public interest. 7t is not a

good idea at all.1

%ut others argue that Greece has no choice. Two bailouts from the 5uropean 6nion have failed to

in>ect life into the economy which has been in recession for the past si9 years. 6nemployment is

3 per cent and the deficit is forecast to grow to (;pc of GP this year. Almost ($$$ >obs have

been lost every day over the past three years in the private sector and as part of !r &amaras's

deal made on !onday (*$$$ public sector workers are set to be made redundant as part of a

Troika's programme for slimming the bloated public sector.

As well as political resistance the other problem for privatisation programme is finding buyers.

2hile the more picturesue islands might seem attractive busy the same cannot be said of vast

loss-making behemoths like the ?ellenic /ailways Betwork and the Public Power ,orporation.

%oth have militant unions that have vowed to fight privatisation tooth and nail making them highly

risky prospects for investors.

That partly e9plains why Greece has only raised about 56 billion from privatisations since its

first bailout loan in !ay $($ missing its target of raising 56) billion by last year. The country's

longer-term aim of raising 56*$ billion by $(; has repeatedly been scaled back and the best it

now hopes for is to raise around 56 (( billion in privatisation proceeds by the end of $(#.

8rom his office overlooking the !andraki marina in central /hodes Town &tathis Cousournas

mayor of /hodes sees no alternative.

12e want this investment 0 we actually fought for it to happen1 he said. 12e have to make sure

that we are getting a fair price and respecting the environment but those who have come to mewith concerns are in the minority.


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17t is not all being sold permanently 0 some of it is a long-term lease. 2e're all an9ious to make

the best of this 0 it is a development for all of us.1.

6nemployment on the island is low compared to the mainland averaging (3 per cent over the

year thanks to the influ9 of tourists. %ut life is still hard.

!aria Carabini a +$-year-old civil servant has seen her salary drop by half over the past three

years. Bow after paying her mortgage she only has 56$$ a month to live on.

1This sale of the land must happen1 she said. 12e need this now uickly. Tell the /ussians and

the ob creation wealth creation1 said !r &tavridis. 17 am the anti-bureaucracy man: we need

to bring in this money 0 there is no other way.1

7n !r &tavridis's office in central Athens not far from the parliament a pair of American

businessmen discuss in hushed tones their negotiating position. A ticker tape flickers above the

head of the receptionist detailing the latest hot offers: Afandou ,orfu lands the disused Athens

airport.

12e have been acting so stupidly for years making rules against our own interest1 !r &tavridis

added. 1%eing state-owned and well run is a contradiction in terms.1

8or those who do take the plunge there are still myriad hurdles to overcome despite the efforts

of !r &tavridis's team. and registry is patchy at best while investors must also promise to

commit their own euity but many foreign banks are wary of lending to Greek pro>ects. Greece

would appear to be only acting now because the Troika has forced its hand.

%ack in Afandou Eassilis Anastasiou the manager of the golf course for the last )$ years looks

out every day on concrete proof of the 1stupidity1 of previous government programmes.

A grand bree@e block clubhouse looms over the golf courseF completed in (;3) and strangled by

bureaucracy empty ever since.

1At least under the military >unta it only took three years to build that site1 said !r Anastasiou.

1Governments since would have taken *$ years to do the same.1


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?is club has around ($$ members paying 56+$$ a year and with #$ of them playing regularly.

%ut he is adamant that the land must be privatised 0 even if it means increasing the fees.

1Anyone who argues against it is either an idiot or a state employee who doesn't think about

economic reality and >ust likes to lounge on the beach1 he said. 12e have our heads in the

noose.1

Greece's great fire sale.docx

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