Greece and the State: Prometheus Bound?
Published: June 2010
Pervasive state intervention in Greece has mired the economy with large-scale inefficiencies and an uneven playing field, protecting insiders and rent-seekers to the detriment of its underlying growth potential, with the political class at the same time failing miserably to address the aspirations of the people. Fiscal consolidation and structural reform, currently pursued under the EU–IMF stabilisation programme, if vigorously implemented, are expected to strengthen the Greek economy and to contribute towards the withering away of the Greek state in its present form. The Greeks are resourceful people and will not capitulate in the face of a daunting adjustment, which may prove easier than generally expected if structural weaknesses are adequately and swiftly addressed. Greece’s future lies with rebalancing the economy towards net exports, with tourism and real estate being the primary development motors.