Greek Privatization Progress
Will international creditors say yes again to Greece after today’s meeting in Brussels?
Part of the deal involves selling or leasing whatever the Greek government owns. The proceeds reduce the debt and meanwhile, by building roads and business parks, resuscitating ports and recapitalizing banks, foreign investors pour money into the country.
It has not been quite that easy, though.
A closer look at government-owned beaches that were for sale revealed squatter communities composed of thousands of undocumented houses. In addition, because Greek property registries are woefully inaccurate, land transfers everywhere have been problematic. (If you can’t prove you own the land, then no one will buy it from you.)
The ports? Greek citizens are worried about prime assets being transferred to foreign ownership or worse, to Greek oligarches awaiting a fire sale. In addition, no one appears to be quite sure how much ownership the government should retain. And even if the Greek parliament settles all of that, foreign banks hestitate to finance Greek deals and the Greek banks need recapitalization.
All of these privatization complications made me wonder how many deals could be involved so I went through a month of articles at eKathimerini.com and came up with this random list of government-owned properties that could be partially or entirely sold or leased. They represent only a small proportion of the hundred of deals that might transpire but do provide a picture of the massive task facing the Greek government.
- Public Power Corporation
- Gaming company, OPAP
- State lottery licenses
- Public Gas Corporation
- Gas transmission operators
- Hellenic Postbank
- Elliniko International Airport
- Athens Water Company
- Hellenic Petroleum
- Hellenic Vehicles
- Assorted Port Authorities
- Buildings that house state agencies
- Thessaloniki Water Company
- Larco, Europe’s largest ferronickel producer
- Egnatia motorway
Finally, where will the money go? Satisfying the bailout “troika,” the IMF, the European Central bank, and the European Commission, the Greek Parliament has issued “decrees” that direct the money to an escrow fund dedicated to paying the Greek debt.
Finally, the following Merle Hazard “Greek Debt Song” is always fun to watch.