Podcast: Greece's Dark Decade with Kyriakos Mitsotakis

Transcript

Listen: In bailing out Greece did the European Union destroy the village in order to save it? Today on the show, Ian dives deep into the Greek debt crisis and speaks to the man who will likely be Greece's next prime minister, Kyriakos Mitsotakis.

TRANSCRIPT: Greece's Dark Decade with Kyriakos Mitsotakis

Kyriakos Mitsotakis:

Well, we lost 25%, 26% to be exact of our GDP, and overall it was a very traumatic experience.

Ian Bremmer:

Hi, I'm Ian Bremmer and welcome to the GZERO World Podcast, an audio version of what you can find on public television where I analyze global topics, sit down with big guests, and make use of small puppets. This week I sit down with Kyriakos Mitsotakis, the head of Greece's main opposition party, and the country's likely next prime minister. I will ask him about Greece's painful last decade and what lies ahead for his country and for himself in the years to come. Let's get to it.

Announcer:

The GZERO World is brought to you by our founding sponsor, First Republic. First Republic, a private bank and wealth management company, places clients' needs first by providing responsive, relevant and customized solutions. Visit firstrepublic.com to learn more.

Ian Bremmer:

Kyriakos Mitsotakis, president of New Democracy in Greece, perhaps next prime minister of the country. Very good to be with you.

Kyriakos Mitsotakis:

Well, thank you very much for having me.

Ian Bremmer:

So, maybe start with a little of the pain. I mean, Greece has just been through, and is not out of, a depression that was both wider and deeper than what was experienced in the United States. Tell our viewers a little bit about what that's done to your country.

Kyriakos Mitsotakis:

Well, we lost 25%, 26% to be exact of our GDP. And overall it was a very traumatic experience for Greek society. Unemployment skyrocketed, 400,000 young Greeks were forced to leave the country. Very talented, very educated, young Greeks decided to leave, were forced to leave because they didn't have enough good jobs. Poverty increased significantly. So, there was a lot of pain. And the problem with the Greek crisis was that the pain was prolonged unnecessarily. In my mind, this crisis should have been over in 2015, but that was a time when Greece decided to experiment with populism, and we were the first to actually elect a populist party into power.

Ian Bremmer:

Syriza, you're talking about.

Kyriakos Mitsotakis:

Syriza and Mr. Tsipras who got elected by essentially promising that they would end austerity and rip up the programs with one law and magically restore pensions and wages in a completely unrealistic strategy. You remember what happened, and I'm sure your viewers remember what happened during the first six months of 2015. Varoufakis, he's our ex-minister of finance. Yeah, we literally came very close-

Ian Bremmer:

The best known Greek at that point in the West.

Kyriakos Mitsotakis:

Unfortunately it didn't do Greece much justice or made us feel very proud. But we came very close to actually leaving the Eurozone in July 2015, and then Mr. Tsipras made a spectacular U-turn, but the damage was already done. And these first six months cost us in excess of a hundred billion euros, an unnecessary third program. And now we're at a stage where technically we're out of the program, but still under heavy supervision by the European Union. And we still have not restored full market access, and more worrisome, the economy is not growing fast enough for people to really understand that we have left the crisis behind us. And there still is a lot of pessimism in Greek society. So, after almost 10 years, one can be cautiously optimistic.

Ian Bremmer:

Understandable to point fire at mistakes made domestically inside Greece, but of course part of the reason for the rise of populism was because of so much anger at the Germans, so much anger at the EU. How much of that is justified? I mean, the German banks, of course were the ones that were fully bailed out after all of this hit. The Germans thought of the Greeks as lazy, even though the Greeks were very hardworking. I mean, what do we think about the dynamic between Greece and Germany at this point?

Kyriakos Mitsotakis:

To a certain extent, austerity has been pushed too hard in Greece. At the end of the day of course, we had to make a significant fiscal consolidation. But this is not just about balancing the books, it's also about changing the fabric of the Greek economy and making it more competitive and making real reforms. I mean, we talk a lot about structural reforms, but what is it really all about? It's about making our public administration more efficient. It's about making our educational system more results-oriented in terms of providing our young kids and our students with the necessary skills to compete in a difficult world. It's about making our justice system more responsive because it takes for ages to get a court decision in Greece. These are the real sort of important reforms that we have to implement. So, focusing just on the numbers on producing big fiscal surpluses is maybe necessary to a certain extent to address your debt problem, but it doesn't really solve the underlying problems.

Ian Bremmer:

Do you think the Greek people understand the extent to which the pension system was unsustainable, the extent to which tax receipts weren't coming in, the extent to which the basics of the economy in their country just weren't working?

Kyriakos Mitsotakis:

I think it's all good to look at the polls, and we're happy that the polls are good for us, but I'm more interested in the underlying trends. When we ask Greeks today, how do you feel about the private sector, about entrepreneurship, about private investment, there has been a significant change in their attitudes vis-a-vis what they thought about these issues five years ago. So, there's a much greater understanding that growth needs to be driven through private investment, that we should expect the state to be more efficient, that the solution to the unemployment problem is not to hire people in the public sector without any restraint. And I think there is a degree of self-understanding that yes, part of the problem was caused by our collective failures.

Ian Bremmer:

So, you were the first in Europe, Greece, to elect a strongly populist government, certainly not the last. And I'm wondering how you compare the experience that the Greeks have had with populism, both left and right wing, to what we've seen happen in Italy, what we've seen happen in Spain?

Kyriakos Mitsotakis:

When populists get elected into power, because usually they cannot deliver real results, they tend to behave in a rather authoritarian manner. We've seen it in other European countries. We've also seen it in Greece where what is at stake today is not just the future of our economy, but even the state of our democracy. Syriza has been undermining democratic institutions very systematically, going after media independence, trying to intervene in justice, going after all sort of independent bodies and authorities. It won't work in Greece because they will lose the next elections.

Ian Bremmer:

But it also won't work in Greece because I assume the institutions are strong enough to resist it.

Kyriakos Mitsotakis:

The institutions were strong enough, but they were also under a lot of pressure. And yes, our constitutional court when it was necessary, took important landmark decisions against the Syriza attempt to control the media landscape. But Greece is a country that has institutions that still need to become stronger, obviously. So, I'm a big believer that institutions matter, that there is a correlation between the quality of your institutions and the level of prosperity in a country. And we have a lot of work to do on that front. But one of the reasons why this attempt to encroach upon institutions didn't succeed had to do with the fact that we managed to present a unified front as opposition. We made it very clear, we highlighted these issues, we fought hard in parliament to raise public awareness, but that doesn't mean that the effort was not put in place to actually try to play that game.

Ian Bremmer:

Now, I mean, Greece is the crucible of democracy. For the world, democracy doesn't seem to be doing as well as many had hoped these days. And not only the challenges you're facing in your country and across Europe, but also more broadly. As a Greek, how do you think about the challenges that democracy is facing around the world today?

Kyriakos Mitsotakis:

Well, you are right to point out that we have, so we may have something to add to this discussion. Again, sort of the ideal type of Athenian democracy certainly teaches us some lessons, but it doesn't necessarily apply to a world of representative democracy. But at the end of the day, we need to be very honest and accept the fact that a lot of the grievances that people have are justified.

Ian Bremmer:

One of the biggest crises that Europe has experienced, that your country has experienced, has been the extraordinary influx of refugees from Syria, across the Mediterranean. The numbers have gone down significantly, but the legacy for Greece remains. What lessons do we need to take away from the experience the Europeans and Greece has had with that crisis?

Kyriakos Mitsotakis:

Well, 2015 was a very difficult year. And more than a million people actually came into Greece, and then most of them actually moved into Central Europe in search for a better future. Europe does not have a common answer to this problem, and it's a problem. First of all, in my mind, we have to agree on certain basic facts. We need common asylum policies across all European countries. We need to agree that if we want to have free movement of people within Europe, we need to protect our borders. And by protecting our borders, we basically need to make it very clear that not everyone is sort of allowed to come into Europe without consequences. By consequences, I mean that there has to be a distinction between refugees who are entitled international protection and economic migrants, because you mentioned Syrians, but most of the people who actually come into Greece even now are not, they don't have a refugee profile. They are what we call economic migrants.

Ian Bremmer:

True of most in the United States as well.

Kyriakos Mitsotakis:

We cannot say that we are going to accept them with open arms. And Greece being a frontier country cannot handle this responsibility on its own.

Ian Bremmer:

Politically and ideologically, most of what I hear from you is the populism and the tribalism is a problem, we need to get away from it. It's important to do the right things for economy and security. And yet on this one, we're focusing on the nation and the tribe and the traditions. Which are sensitive, I understand, but nonetheless, how do you deal with that?

Kyriakos Mitsotakis:

I think this is not just about political tactics. Look, Greece is a country that is today, I would say lucky in a difficult part of the world to be ethnically homogeneous.

Ian Bremmer:

Let me ask you another tough one, which is, we know about the Chinese spending a lot of time and effort investing across Eastern Europe, investing in Greece. Just recently, the Italian government announcing they want to formally join Belt and Road. If you're Prime Minister, would you want Greece to formally join Belt and Road?

Kyriakos Mitsotakis:

No, I would certainly not go that far. And plus, I don't exactly understand what it means to formally join Belt and Road. And nobody has approached me with a formal offer to potentially join Belt and Road. But what I would say is that in a country that needs a hundred billion euros of investment over the next six to seven years, we need to be open when we attract foreign capital. The Chinese were the first to actually take a serious look at investing in the port of Paros at the time when nobody else was interested. And frankly, they did a good job. By good job, I mean, they took a port that was completely run down and transformed it into an efficient operation, creating lots of jobs, and upgrading the whole Paros area.

Kyriakos Mitsotakis:

And they also have ambitious projects now for the commercial port, not just the container port. They're not going to take the port away and move it to another country. We still retain full regulatory control over how we manage our policies. So, I don't see serious risks of the country being taken over by Chinese capital when it comes to critical infrastructure. So, I'll show a little bit less panic about the-

Ian Bremmer:

So, on an issue like Huawei, where the Americans feel very strongly, these guys need to be kept out. Some American allies agree, the Brits are being a little bit more, I would say, hedging in their behavior. Cheaper system, rolling out in 2020, open national security concerns. What do you think about that?

Kyriakos Mitsotakis:

I'm not that knowledgeable about the details of 5G technology to know how much of a threat that could be. But that is a different story because there you're talking about seriously compromise... I don't know, what could be a compromise on a critical infrastructure that has to do with data protection and with critical networks. A port is not necessarily in the same category. That's why I would differentiate vis-a-vis the types of investment. And at some point, if there is a real case to be made at the European level and there is real data and evidence, I would look at it obviously with a lot of interest. But again, coming back to your initial question, Greece needs capital, and we want to get capital not just from the Chinese, we want to get it from the Japanese, we want to get from the Europeans, we want to get it from the Americans.

Kyriakos Mitsotakis:

If you look at the relationship between the US and Greece, strategically, it's excellent. It's as good as it ever was. The reason being that Tsipras, also vis-a-vis the US made a huge U-turn, these were the people who were always p,rotesting against the US considering the imperialists and wanted to kick in all the US bases out of Greece. Now, Mr. Tsipras told us that the US is number one strategic ally for Greece. As someone who studied in the US, I can only welcome this development. But if you look at US capital, direct foreign, direct investment by the US in Greece, there's almost none. There's very little. So, I cannot accept someone telling me, "I don't want this guy to invest." Well, the opportunities are here-

Ian Bremmer:

Put your money where your mouth is.

Kyriakos Mitsotakis:

... Put your money where your mouth is at the end of the day. And this is also true for my European friends.

Ian Bremmer:

So, now we need to test your Greek credentials. We're going to do a lightning round, and I need you to respond quickly and describe for the audience if they don't know, ntomátes, what are they?

Kyriakos Mitsotakis:

Ntomátes?

Ian Bremmer:

Yes.

Ian Bremmer:

Tomatoes.

Kyriakos Mitsotakis:

Yes. Okay. How about galaktoboureko?

Kyriakos Mitsotakis:

Galaktoboureko is a nice pie made out of milk.

Ian Bremmer:

Baklava.

Kyriakos Mitsotakis:

Yeah, baklava is another very nice sweet of Turkish origin.

Ian Bremmer:

Avgolemono.

Kyriakos Mitsotakis:

Avgolemono is a very nice sauce made out of egg and lemon.

Ian Bremmer:

Very good. And Chobani says they're Greek yogurt, is that acceptable?

Kyriakos Mitsotakis:

Absolutely unacceptable. Greek yogurt is what you get when you buy a Greek brand. I don't want to publicize Greek brands. And the same is true with feta cheese, you have to get the original feta. The original feta has a very specific composition when it comes to the milk that goes into the feta. Not all white cheese is feta, so when you buy feta, make sure it's Greek feta.

Ian Bremmer:

And if I go literally a block away, I can buy Turkish coffee. Does that exist?

Kyriakos Mitsotakis:

It's a way of preparing coffee, but it's very similar to Greek coffee. So, there are some similarities to the coffee they drink in Turkey.

Ian Bremmer:

But there's no preference between the two.

Kyriakos Mitsotakis:

Oh, I would prefer Greek coffee.

Ian Bremmer:

You would prefer? Okay. Kyriakos Mitsotakis, thank you very much.

Kyriakos Mitsotakis:

Thank you. Thank you. Thank you very much.

Ian Bremmer:

That's our show this week. We'll be right back here next week, same place, same time. Unless you're watching on social media, in which cases, wherever you happen to be. Don't miss it. In the meantime, check us out at gzeromedia.com.

Announcer:

The GZERO world is brought to you by our founding sponsor, First Republic. First Republic, a private bank and wealth management company, places clients' needs first by providing responsive, relevant and customized solutions. Visit firstrepublic.com to learn more.