How can Greece act now to create advantage from adversity?

Record-high confidence in Greece’s attractiveness policy

Survey participants increasingly associate Greece’s improving image with the policies being implemented. A total of 82% of respondents - up from 79% last year, and just 50% in the first year of the survey in 2019 - rated Greece’s attractiveness policy as effective in attracting international investors, including 22% who described it as very effective.

Greece’s performance in attracting talent (70% deem Greece’s performance is good overall) appears to be driving this positive sentiment. This is followed by its ability to attract companies (69%), innovative activities (66%), and capital (63%). On the other hand, policies aimed at attracting business headquarters (51%) and establishing global centers for competitiveness or world class clusters (50%) are seen as less effective. It is worth noting that in the first year of the survey, back in 2019, none of these indicators exceeded 50%.

Respondents also believe that the country’s approach in areas such as data and technology (65%), sustainability (64%), artificial intelligence (63%), innovation (58%), and regulation (56%) has positively impacted its attractiveness. However, investors remain more cautious about Greece’s approach to tax competitiveness (46%) and the labor market (40%).    

Positive perception for the country over the past year couples with optimism for the next three years

Three out of five participants (60%, compared to 62% last year) stated that over the past year, their perception of Greece has improved as a place where their business might establish or develop its activities. Specifically, among companies that currently do not have an investment presence in the country, the percentage has increased from 39% to 41%. At the same time, 63% (down from 69% last year) believe that the country’s attractiveness will further increase over the next three years. This percentage compares positively to the corresponding figure for the whole of Europe (61%) and other European countries surveyed.

Attractive destination for investments related to industrialization

Given the major challenge of reindustrializing the country, participants were asked how they evaluate Greece’s attractiveness as a destination for investments related to industrialization. While only 29% of those planning investments in the country over the next year said these involve manufacturing activities, overall, 76% of respondents consider Greece an attractive destination for industrialization-related investments, including 20% who find it very attractive, suggesting potentially untapped opportunities in this sector.

The most promising prospects for such investments are found in the energy sector, including renewables (45%), shipping, including marine and naval engineering (42%), and the pharmaceutical and biotechnology industry (37%).

Three key priorities for enhancing the country’s competitiveness

In order for Greece to maintain its competitive position in the global economy, respondents highlight three main priorities: supporting strategic industries, such as cleantech, artificial intelligence, defense, technology, and others (28%); developing education and skills and facilitating access to talent (26%); and reducing and simplifying taxation (25%).

Investors expect even more from Greece

In the past five years, Greece recorded more foreign direct investment than it had during the previous two decades combined. This performance is even more notable considering it occurred at a time when FDI in Europe declined by 16%, due to economic slowdown, the war in Ukraine, and intensifying competition with the U.S. In this challenging environment, the resilience of FDI in Greece and investors’ positive sentiment toward the country should not lead to complacency. On the contrary, Greece must remain committed to reforms that will further strengthen its long-term attractiveness.