Remarks by Angel Gurría, OECD Secretary-General
27 November 2013, Athens, Greece
(As prepared for delivery)
Minister Hatzidakis, Ladies and Gentlemen,
I am delighted to be back in Athens to present an important body of work that will help Greece chart a course for its future. Besides this, as well as the Competition Assessment of Competition Laws and Regulations in Greece, which we will present to you, later today I will also launch the OECD’s 2013 Economic Survey of Greece and provide an update on the progress of our Administrative Burden Reduction project.
We expect the Greek economy to be in recovery mode by this time next year before achieving a positive growth rate in 2015. While the return to positive growth is on target, what is less clear is whether growth will be sufficiently strong to make the debt burden manageable and bring about the widespread improvements in living standards needed to heal the wounds of the crisis.
This is why, irrespective of the troika programme, Greece needs to continue to execute a reform agenda that promotes inclusive growth. Yes, Greece has already introduced an impressive array of reforms in a short period of time. And yes, reform can be painful in the short-term, particularly when the economy is weak and you are trying to bring down the budget deficit at the same time.
But it is the only way to achieve the productivity growth and competitiveness improvements that will be the bedrock of Greek growth for years to come. It is also essential to create the conditions for a dynamic, competitive private sector to thrive.
Making it easier to do business is the key to Greek growth
For the past year, two OECD teams have been working on the ground here in Athens, side-by-side with the Greek authorities, to improve the business environment in Greece and create jobs by reducing unnecessary red-tape and eliminating harmful barriers to competition. And we are already starting to see positive results!
The Competition Assessment which I have the pleasure of launching today is the first of the fruits of these labours. I would like to pay tribute at this point to Minister Hatzidakis for the support and commitment he has shown in making this project a success. And, of course, I would also like to thank our partners and funders, the Hellenic Competition Commission and the EU Task Force for Greece, without whom this project would not have been possible, never mind successful.
The Competition Assessment was an ambitious undertaking, involving the scrutiny of more than a thousand pieces of legislation in four sectors: food processing, retail, building materials and tourism. We have identified more than three hundred areas for reform that would lead to greater competition, wider consumer choice and lower prices.
If all of these recommendations were fully implemented, we estimate that Greek consumers would be better off to the tune of 5.2 billion euros a year, or 2.5% of GDP. The economy-wide benefits from increased productivity could ultimately have an even greater impact.
To provide a few examples: Greek cruise operators are currently at a disadvantage compared to foreign operators, because every cruise that begins in a Greek port must return to that same port. Removing this round-trip restriction would level the playing field and give Greek tourism a boost of almost 65 million euros annually.
The Government partially liberalised Sunday opening hours earlier this year. We estimate that the full liberalisation of Sunday trading for larger stores and shopping malls would benefit Greek consumers and the economy, generating between 18-30 thousand new jobs in the retail sector and additional annual expenditure of 2.5 billion euros.
There are many other examples and I invite you to read the report carefully and to ask the authors, who are here today, any questions you may have.
Reducing administrative burdens will cut costs and improve productivity
In March of this year, we launched a parallel project aiming to relieve the regulatory burden on Greek business. The ultimate goal is to reduce administrative burdens in Greece by 25% across 13 selected sectors, all of which have much potential for sustaining growth in Greece in years to come. Some of the sectors we are focusing on include: Company Law, Tax Law (VAT) and the law on the working environment and employment relations. We expect this to generate annual savings to businesses in these sectors in the region of 1.8 billion euros per year while supporting growth in productivity.
The administrative burden reduction project will not be concluded until January next year, but even at this early stage we can present some preliminary results. I will be presenting a number of these “quick-wins” alongside Minister Mitsotakis later this afternoon, and we would hope to see their early implementation having an immediate impact on competitiveness and growth. These early initiatives will reduce immediately, in a small way, some administrative burdens and remove some irritations for the businesses concerned.
Ladies and Gentlemen:
Both of these initiatives – the Competition Assessment and the related Administrative Burden Reduction project – are about making it easier to do business in Greece. But they also represent a new way of doing business for the OECD. With teams working on the ground, hand in glove with local partners, to design and implement reforms tailored to the existing legal and regulatory framework;, this is an example of the OECD not only as a ‘think tank’, but as a ‘think-and-do tank’.
We know that Greece is undergoing a profound and painful economic adjustment, but we are convinced that continuing down the path of ambitious reform will ultimately see a return to robust, broad-based growth that will improve the well-being of all Greek citizens.
As we work together towards these shared goals, I look forward to implementing and building on the success of the projects I am presenting today and to further deepening our fruitful collaboration.