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Greek Financial Adviser Discusses Economic Crisis

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Greek Financial Adviser Discusses Economic Crisis


Greek Financial Adviser Discusses Economic Crisis

Greek Financial Adviser Discusses Economic Crisis

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  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript

Greece continues to be the card that threatens the stability of the economic eurozone. Melissa Block talks to Elena Panaritis, one of the Greek prime minster's financial advisers, about the underlying causes of the crisis — and the future of the Greek economy.

GUY RAZ, Host:

From NPR News, this is ALL THINGS CONSIDERED. I'm Guy Raz.


And I'm Melissa Block.

Now to the precarious financial situation in Greece, which says it could default on its debt within weeks if Europe doesn't come up with more bailout money. European finance ministers are balking. They say Greece needs to do more to transform its economy before they'll release more funds.

The Greek debt crisis has been rattling financial markets around the world. And for people in Greece, their own economic future looks extremely shaky.

I spoke earlier today with economist Elena Panaritis. She's a member of the Greek parliament, and an economic adviser to the Socialist Prime Minister George Papandreou. She says the solution to Greece's financial trouble lies not just in austerity measures, but also in reforms to an overly bureaucratic system.

ELENA PANARITIS: For example, a company that wishes to close up, it may take up to a year to close its books because of bureaucracy. It's very complicated to go through the judicial system, so the judiciary needs to be reformed. Our tax administration is still not a tax administration system that would match a German tax administration system, or even a U.S. tax administration system. It's very inefficient. So one euro that is collected does not deliver one euro of revenues, but delivers 0.4 of the euro.

And we're not a dictatorship. We're a democracy, so we can't just decide on Monday morning and Monday afternoon have decisions applied.

BLOCK: I'm curious to hear your perspective when you hear the international community say that Greece is a failed welfare state. It has a hugely bloated civil service and it's a country of widespread tax evasion. It's estimated more than $100 billion goes uncollected in taxes every year. What do you say to them? Are they right?

PANARITIS: Well, these are the problems that show up as tax revision. But in reality it's what I told you earlier, a broken system. The oxymoron about our country is that although we are a 4,000-year-old civilization, we are only a 35-year-old modern economy and modern democracy. So our organizations, our institutions are not as mature. But this applies to also other European Union countries. And unfortunately, we're the weakest link and the crisis hit us first.

BLOCK: Do you accept that those things do need to change if lenders are to have confidence in the Greek economy, that there needs to be a wholesale revision and reform of your country?

PANARITIS: Yeah, absolutely, there needs to be a change. However, there needs also to be a full understanding and acceptance that we only are part of 2.7 percent of the GDP of the eurozone. And that the markets are not reacting simply to the one-seventeenth of the member country of the eurozone. Instead, they're reacting to the way the euro is being systemically handled.

BLOCK: As you've seen the waves of public protests and strikes, and even riots in the streets over the austerity measures that the Greek government has put into place, how do you convince people that these are necessary if Greece is to avoid default? What's the message you try to send?

PANARITIS: The message that we sent is pretty clear but it's not a verbal message. It's a message that everybody can live and smell it and feel it every day. Shops are closing every single day. People lose their jobs. People leave the country. Our salaries have been reduced by 40 percent. Pensions have been reduced by 40, 45 percent. And we have constant taxes being raised so we can meet the target for our conditionalities with our IMF and European Union loans.

And fortunately, as the days go by, it becomes more and more real right under the skin of every single Greek. So we just don't really have to say very much, but just promise to tell them that we are trying our best to keep our country afloat and move ahead.

BLOCK: Elena Panaritis, thanks very much for talking with us today.

PANARITIS: Thank you very much.

BLOCK: That's economist Elena Panaritis. She's a member of the Greek Parliament and a top economic adviser to Prime Minister George Papandreou.

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