DAVID GREENE, HOST:
And let's talk now about one slice of the Greek economy. Greece is a great place to farm. The warm Mediterranean climate is perfect for growing many fruits and vegetables and other produce. And many people have done just that. But Greek farms are often small and family-run, meaning they have a tough time competing internationally, and things are about to get tougher. The latest bailout by European creditors means the Greek government may have to phase out tax breaks for farmers. Here's NPR's Jim Zarroli.
JIM ZARROLI, BYLINE: Nick Lapatas spent 18 years living in Chicago. Then he returned home to Greece and bought a small farm. Today, he and his son sell tomatoes in this open-air market in Athens. And despite the depressed economy and cheaper imports from Bulgaria and Albania, he's doing OK.
NICK LAPATAS: I don't know how, but we are making some money, you know? Now what is going to happen in a month from now, I don't know.
ZARROLI: The Greek government has long allowed farmers like Lapatas to charge their customers lower taxes. But under the bailout terms, that exemption is expected to be phased out. Lapatas is dreading the change.
LAPATAS: For us, when they do that, we're going to stay home. I'm going to go take a few chickens. I'm going to put a little tomatoes for myselves. I'm going to have my land. You cannot do that.
ZARROLI: Some 90 percent of Greece's farms are family-owned and most are very small - 5 acres on average. Yiouli Doxanaki runs a consulting firm that works with farmers. She says Greece's rugged and hilly terrain doesn't lend itself to big farms, and small farms have trouble investing in the machinery that would make them more productive.
YIOULI DOXANAKI: We don't have economies of scale. Production costs are high in terms of, you know, buying everything you need to produce. And we end up with a product that's quite expensive.
ZARROLI: As a result, Greece's farms often have trouble competing internationally. They're undercut by cheaper producers in places such as Egypt and Albania, and they're less productive than farmers in the Netherlands and Spain.
Menelaos Tzouris runs a trading company in Athens that buys fruits and vegetables from small farmers and sells them to retailers. He says, it's almost too easy to grow food in Greece, so people never had to try too hard to feed themselves.
MENELAOS TZOURIS: Other European countries like Holland or Poland, which did not have the natural advantage to grow, they had to do it using a smarter way.
ZARROLI: Tzouris says Greek farmers are beginning to embrace technology, but they need to go further.
TZOURIS: We need to do a better job, have a better product. That's what we need to do.
ZARROLI: If Greece's economy is to begin growing, it will also have to export more. Yiouli Doxanaki says Greece has plenty of good agricultural products, such as olives and cheese. The challenge, she says, is to convince the rest of the world that Greece's exports are worth the extra cost.
DOXANAKI: That's the turning point now. If this doesn't happen, then the farmers will have no reason of existing because they won't be able to compete other countries with the same products.
ZARROLI: But changing Greece's image will take time and money, and the government lacks the resources to help much. Meanwhile, the ongoing economic crisis inside Greece means the domestic market has shrunk as well. The end of the tax exemption will mean higher costs for Greece's farmers at a time when they can least afford it. Jim Zarroli, NPR News, Athens.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.