Eurobank Forum: From the Drachma to the Euro

A two-day international economic conference entitled 'From the Drachma to the Euro' was formally opened this evening at the head offices of the Latsis Group, 'Pallas Athena', in Kephalari, Kifissia, in the presence of leading figures of Greece's political, economic and business life. The conference, which is being held under the auspices of the Association for the Monetary Union of Europe (AMUE), is part of EFG Eurobank's on-going campaign to assist enterprises and the public at large in their preparations for a successful transition to the euro. The Minister of the National Economy and Finance, Mr Yannos Papantoniou, the Governor of the Bank of Greece, Mr Loukas Papademos, and the Governor of the National Bank of Greece, Mr Theodoros Karatzas, were speakers at the official opening of the conference.
Proceeedings were opened by a brief introduction from the Chairman of the EFG European Financial Group, Dr Spiro J. Latsis, who, before introducing the speakers, spoke of the role of the AMUE and its contribution to European integration. Mr Latsis paid special tribute to M. Valιry Giscard d' Ιstaing, former President of France, who is attending the conference. Mr. Latsis spoke warmly of his contribution during Greece's march toward membership of the European Community. Mr. Latsis chaired the discussion and toward the end took questions from guests. The questions focussed mainly on economic and monetary developments in the run-up to Greece's accession of the euro zone, the adaptation of enterprises to the new environment, and developments in the financial sector. The Minister of the National Economy and Finance, Mr Yannos Papantoniou, spoke of the new opportunities opened up by membership of EMU. In this context, the central objectives of the Government's policy are:

A drastic reduction in public debt. The aim is to reduce public debt to a level approaching 60 per cent of GDP by the end of the decade; this requires the achievement of budget surpluses. The budget for the year 2001 will be the first surplus budget of the post-War period, and will mark the completion of public finance consolidation.

The achievement of growth rates of at least 5 per cent, aiming at real convergence with EU average income levels by the end of the decade.

The re-organisation of the economy based on competition and social responsibility. The disengagement of the public sector from entrepreneurial activities, and the creation of open markets within which enterprises will operate under a régime of free competition, but under strict rules and strict surveillance from supervisory authorities.

The creation of a cohesive society and a society of solidarity. Mr Papantoniou then referred to the foundations currently being laid for the modernisation of the European developmental model, whose strategic aim is to see the European Union become the most competitive and dynamic economy in the world within the next ten years, capable of sustaining an economic development process that will also provide more and better jobs as well as greater social cohesion. Greece is playing a dynamic role in this emerging new economy thanks to a Government strategic plan to promote the information and knowledge society. Mr Papantoniou concluded by saying that considerable time would have to pass before the final structure of the European Union is finalised. Nevertheless, progress towards political unification, which started 50 years ago, has speeded up, and a European federation can now be clearly seen on the horizon. Greece will also be present in this final stage of European unification. The next speaker was the Governor of the Bank of Greece, Mr Loukas Papademos. Mr Papademos first reviewed the monetary and foreign-exchange developments of recent years which brought the Greek economy within the convergence criteria; he then pointed out that the adoption of the euro will ensure a high degree of monetary stability in Greece, which is a significant pre-condition for its future economic development. He noted at the same time, however, that the crucial question was how far the expected speeding up of the rate of economic activity would be lasting and sufficient to achieve the convergence of Greek living standards on the EU average. Thus, in the new environment, real economic convergence can be achieved chiefly, if not exclusively, by structural adjustment measures which aim to raise productivity and improve the competitiveness of Greek products. Such an adjustment should turn on the following axes: market liberalisation, promoting technological research and innovations, modernising public administration, supporting business activity, improving education and vocational training, and improving the working of the labour market and the financial sector. The last speaker was the Governor of the National Bank of Greece, Mr Theodoros Karatzas, who spoke of post-accession developments. The speaker said that the latter called for careful thought about the magnitude of the challenges facing enterprises. This is because, on the one hand, firms represent the backbone of economic activity, generating employment and output; on the other hand, banks are dependent upon these firms' progress and on satisfying all types of customers. Mr Karatzas pointed out that Greek and European companies will in future have to deal with a new generation of priorities; in their efforts, they will now be supported by the new common European currency, which will provide them with a wider market with greater liquidity and depth. In addition, the arrival of new technological applications in the economy is speeding up developments, but at the same time rendering the work of companies more complex. Closing his speach, Mr Karatzas referred to the question of business practice rules, noting that since the Greek economy had joined the group of economies now leading the way on the international scene, Greek enterprises, insofar as they aspire to benefit from this development, should act and behave accordingly. There are many new qualitative features which they must now adopt; it will be essential that they do so, however, if the new environment is to benefit from a level playing field. What is needed, then, is greater corporate transparency, real and rapid diffusion of information within the market, and effective internal monitoring of all economic units. After the conclusion of the speakers' addresses, the 600 official guests attended a dinner at which the former President of the French Republic, M. Valéry Giscard d' Éstaing was guest speaker. The inauguration of the conference was attended by the Minister of Development, Mr N. Christodoulakis, deputy ministers, MPs and government officials, the President of the AMUE, Mr. Étienne Davignon, governors and senior executives of banks, businessmen, and representatives of the Press.
The conference will continue and conclude its work tomorrow at the Athens Hilton, where participants will be addressed by many distinguished figures from Greek and European political, economic, and business life. Note: The full text of the address of M. Valéry Giscard d' Éstaing will be made public tomorrow.