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Irish Times

Mitsotakis basks in Trump's praise as Greek exporters fear US tariff ‘butterfly effect'

While prime minister Kyriakos Mitsotakis may be basking in Donald Trump 's reported comment, 'I know him. He's a good man,' Greek exporters to the US are increasingly worried at the 'butterfly effect' of tariffs on olives, olive oil and feta cheese. One family-run company, based in the Peloponnese, exports 95 per cent of its olive oil to the US, while another, in central Greece, sends 50 per cent of its table olives to that country. As for feta, 1,200 farmers depend on the co-operative dairy in Kalavryta, a mountain village in eastern Greece, just one of the many producers throughout Greece that export this unique cheese type to the US. A statement by Mitsotakis that won Trump's apparent approval was that Europe is in a 'win-win' situation if negotiations over tariffs can be fruitful. Trump's response was that 'a deal will be made'. Mitsotakis made his remarks in early April, before the likelihood of a trade war between the US and Europe increased exponentially. 'Greece has a strategic partnership with the US,' said the prime minister, who regards Greece as a potential bridge between the US and Europe, while stressing Greece's position in the 'economic corridor' between Europe and the East. READ MORE Greece may be 'small potatoes' in terms of its trade balance with the US but, in a trade war between the US and China , the very considerable Chinese investment in Greece will surely affect Trump's thinking, especially when it is generally interpreted as China's entrée into the eastern Mediterranean region. Cypriot-born Christopher Pissarides, professor of economics at the London School of Economics and 2010 Nobel prizewinner, thinks China can survive a trade war with the US, but that Europe definitely can not. The 'Pissarides Commission', which he chaired, charged with devising an economic growth programme for Greece in 2020, argued that 'maintaining high growth rates over the medium term depends on implementing structural reforms within a continuous transformation process'. This has not happened. Pissarides attributes this to insufficient foreign investment. Furthermore, programmes for growth have not been implemented, due mainly to inertia in the public sector, lack of education reform at school and university levels, and the emigration of talented youngsters to better-paid jobs and start-up prospects abroad. [ Despite the disparities and anomalies, Greece remains a very beautiful country Opens in new window ] Greece's GDP is at the same level as in 2010, at the beginning of the financial crisis. While the minimum wage has increased this year to €880 gross per month (up from €830), which will benefit 1.6 million workers (one third of them in the private sector), Greece still ranks 11 out of 22 countries that maintain a minimum wage. Very few wage-earners approve of the government's economic policies. Pisssarides, when he spoke at the Delphi Economic Forum in April, was particularly critical of the mentality of what he calls 'picking the low-lying fruit' – that is, being content with small returns and modest forecasts. In a comment that would alarm many Greeks, he said: 'Greeks like small shops, small businesses – this is a mentality that needs to change.' This emphasis on taking enterprise out of the family and into a larger marketplace is very similar to what has happened in tourism, where the local, personal cachet of 'what makes Greece Greek' – its people and their culture – is being replaced by the impersonal and hybrid. A local example: in the village where I live in Corfu, the local monastery sold a large amount of land for the building of a row of 'luxury' houses. The name of the development, looking across the coast to Albania? The brilliantly original 'Sea View Villas'. The advent of the (mostly British) purchasers of these houses will, socially, culturally and economically transform the village into a sort of 'Sidcup-on-sea'. But Pissarides himself draws the line at tourism development: 'You don't want the islands packed with gigantic hotels.' This, however, goes in the face of current tourism development; as I mentioned last month, some islands are in danger of turning into concrete havens for the very rich, at the cost of the quality of life for the islanders, as, literally, the fabric of their island is eroded. [ Old-fashioned Greece has no chance of becoming truly developed Opens in new window ] What may be more disturbing, for tourists seeking the 'real Greece', is the recent announcement by the Square Lime boutique hotel group that it should be offering 'authentic experiences'. This suggests that what is currently on offer is 'inauthentic' – not the 'real thing'. The photograph accompanying this announcement in Kathimerini newspaper shows a Square Lime hotel in Naxos featuring a small swimming pool and a row of sunloungers, with one Judas tree in the background. No sea, no village, no 'authentic' food or drink. The group, which generated revenue of €48 million last year, offers 'meaningful hospitality, measured in emotions, in unspoilt destinations'. How the company can describe Ios, Santorini or Mykonos, where it operates, as 'unspoilt' requires the logic of a Donald Trump to defy reality.