Newsletter View

Newsletter March 2013

TRENDS & TRADEWINDS

Global Giants Selecting Greece 

Some of the world’s most important brands have recently doubled down on their presence in Greece.

Procter & Gamble opened a new Innovation Center in Athens, demonstrating the company’s commitment to the Greek market. This is the third innovation center of P&G, the other two are in England and Germany and according to market executives it’s not the investment cost (which is estimated at 3 million Euro) that matters, but what the investment itself represents for the Greek economy. “We have enlisted all our powers to showcase investment opportunities in Greece, attracting not only new investors but primarily those who all these years give a vote of confidence to the country”, the CEO of Invest In Greece, Stephanos Issaias, said.

J&J: Brings New Production Departments to Greece
Johnson & Johnson, the global cosmetics and pharmaceuticals company, and already active in Greece, with a commercial branch and a manufacturing plant, stated it is planning to bring additional production to the country.

Johnson & Johnson is going to build new production departments for consumer products in Greece, a step that will increase the investment for its factory in Mandra.

The CEO of Johnson & Johnson Hellas Consumer Products, Makis Comsatos, said the low cost of production was the main reason to transfer the production departments from other countries to the unit in Mandra.

Johnson & Johnson owns two other factories in Europe. In Greece, the consumer products division has 200 employees and 95% of the production is exported to more than 35 countries.

'Coca-Cola Believes in Greece'
Ahmet C. Bozer, president of Coca-Cola International, expressed his conviction that Greece will emerge from the crisis stronger and more resilient, and when that happens, Coca-Cola will continue to be active in the Greek market and will have an advantage over the competition.

Mr. Bozer said: "In the last two years we invested more than 160 million Euro in Greece. If we did not believe in Greece, we would not have kept our headquarters for 23 countries here. Our commitment to Greece is strong and irreversible".

He said that the current leaders should see what is happening in Greece as an age of transformation and not a period of crisis, because "when you think of the crisis, you immediately enter into a process of protecting yourself, putting yourself in the corner."

If one looks beyond the negative news reproduced by the media, one will see the reality of Greece's many advantages, Bozer said: "It is the top power in merchant shipping, has almost 20 million tourists annually, an important producer of agricultural products and a significant regional investor. In Turkey, for example, 439 companies with Greek capital were officially registered, at the end of 2010, of which 252 were registered in 2005-2010."

He said that 2013 will certainly be a difficult year for Greece, with high unemployment possible and a continuing recession in entrepreneurship, but the course of growth must continue, adding that "the tough choices, which may hurt but without which everything will be lost, are necessary."

(Source: http://www.amna.gr/)

Unilever CEO Pledges Company Will Stay in Greece
Unilever international President and CEO Paul Polman reaffirmed to Prime Minister Antonis Samaras that the Anglo-Dutch food and detergent multinational will remain in, and boost its presence in the Greek market, during a meeting with the Prime Minister.

Mr. Polman said that Greece was on the right track, to which Mr. Samaras replied that Greece was indeed on the right track, "but we need to overcome difficulties and obstacles", adding that "the situation is difficult as there are everyday problems", saying that solving these problems is a target, while priority was on "liquidity in order to unlock the economy."

During the meeting, which was also attended by Unilever's president for Europe Jan Zijderveld and president of Elais-Unilever Hellas Spyros Desyllas, the two sides exchanged views on the European and Greek economy and underlined the need to boost investment in Greece, while the Unilever senior executives stressed the importance of the Greek subsidiary to the international group and continuation of its investigation of prospects for further strengthening its presence in Greece.

While in Greece, Mr. Polman took the opportunity to see first-hand the conditions in the Greek market, and praised the Greek management and employees of Elais-Unilever Hellas for maintaining the viability of the Greek company and its commitment to stand by Greek consumers.

Noting that Unilever this year marks the 50th anniversary of its successful presence in Greece, Mr. Polman said that although the conditions are difficult "we believe that, through innovation that meets the consumers' needs, the excellent execution of our plans in the market and the ongoing efforts of our employees, we will be able to turn the challenges of the Greek economy into opportunities for substantial growth in the coming years."

In mid-November, Unilever formalized an investment initiative to begin production of 110 of its product lines in Greece. The 110 products will not be produced by Unilever's Greek plants but will be outsourced to other Greek companies. The initiative is expected to increase Unilever's turnover from domestic production to 60 percent in 2013 from the current 55 percent. Unilever-Hellas currently exports products to 19 countries, with a turnover of 30 million Euro, accounting for 7.5 percent of its total turnover.


Henkel
Henkel, one of the world’s top detergent manufacturers, has returned to Greece for the production of detergents. Henkel Hellas has returned part of its production of detergents and other cleaning products to Greece, in cooperation with Rolco Vianyl, Henkel Hellas Chairman Kostas Faltsetas announced.

Its domestic production will include 50 product codes—related to the Dixan, Neomat and Bref brands—that currently account for 75 percent of Henkel's total turnover in the home detergents and cleaning products markets in Greece and Cyprus.  At the same time, its production unit will cover the needs of the Cypriot market with production of around 50 codes of the Vernel, Der General and Pril brands.

Henkel’s new cooperation with a Greek firm holds particular significance for the local economy as it illustrates that despite previous problems in Greece, the German company still believes it is worth investing in the Mediterranean country. Henkel had a plant in central Greece until 2000. Henkel’s Dixan, Neomat and Persil brands are popular in Greece.

Cosco
Cosco, the giant shipping firm from China, is keen on participating in the privatization of the Piraeus Port Authority (OLP), an interest which has been confirmed by Greece’s Finance Minister Giannis Stournaras. The China Daily newspaper revealed that the Chinese giant is ready to offer 1 billion Euro to raise its stake in OLP and promote its development, once it has gained control of the Piraeus Port Authority’s management.

Cosco is waiting for the Greek government to present its plans regarding the sell-off of ports around the country, and particularly those of Piraeus and of Thessaloniki, which will start in the year’s third quarter. Cosco is expected to bid for the 61 percent stake in OLP that the Hellenic Republic Asset Development Fund will put up for sale. Currently, Cosco pays Greece 100 million Euro per year for the use of Pier II and the prospective use of Pier III in Piraeus.

New Rail Link Boosts Logistics
A major rail project that will offer a direct link between one of Greece's major ports and the European rail network was opened on February 28.

The 17 km-long single line track links Ikonio port in Keratsini, near Pireaus, with the Thriasio logistics centre, outside Elefsina, which is earmarked to become a major hub in the European rail transportation network.

The Ikonio-Thriasio line radically reduces the time it takes to get freight to European markets.

Ships from Asia that would otherwise sail to Antwerp, Amsterdam or other northern European ports will be able to offload their freight at Ikonio, which will be then transported northwards by rail. The line, the construction of which was announced in 2000, will carry freight only.

Greece, Italy, Albania sign pipeline agreement
The governments of Greece, Italy and Albania signed an agreement on February 13 on the Trans Adriatic Pipeline (TAP) project that will deliver Caspian natural gas to the European Union.

The signing ceremony took place at the Ministry of Foreign Affairs in Athens in the presence of Prime Minister Antonis Samaras.

The gas pipeline is expected to transport natural gas from the Shah Deniz gas project in Azerbaijan to Europe and is expected to attract 1.5 billion Euro worth of investment to Greece as well as lead to the creation of hundreds of jobs.

The deal was signed by Greek Foreign Minister Dimitris Avramopoulos, Albanian Deputy Prime Minister and Minister of Economy, Trade and Energy Edmond Haxhinasto and Italy's Economic Development Minister Corrado Passera.

TAP is being developed by Norway’s Statoil ASA, Switzerland’s EGL AG and Germany’s E.ON Ruhrgas AG and plans to transport as much as 20 billion cubic meters of gas annually from the Turkish border to southern Italy through Greece and Albania and across the Adriatic Sea.

Ministerial Meetings Priming Enterprise in Greece
The Minister for Development, Competitiveness, Infrastructure, Transport and Networks Kostis Hatzidakis and Deputy Minister for Development Notis Mitarachi met on February 26 with representatives of large companies that have recently announced the beginning of, or an increase in, their manufacturing activity in Greece. The meeting was held under the directives of Prime Minister Antonis Samaras with the goal to facilitate investment in the country.

After the meeting Minister Hatzidakis and Deputy Minister Notis Mitarachi made the following statements:

Minister Kostis Hatzidakis: "In addition to the major social problems we face, the recession and unemployment, there are some positive signs that we have an obligation to recognize.

There are companies that invest amidst the crisis and expand their operations. We met with eleven such major companies today. Lately these companies have either expanded their activities or decided to make a new investment. And this is especially important because it shows that the efforts of the government, the Prime Minister’s personally, and especially the sacrifices of the Greek people are making a difference. It's a message of optimism that we can draw from the activities of these companies and this we wanted to highlight by the meeting we held.

At the same time, we had the opportunity to exchange views with the company representatives on the new Investment Law and the government’s efforts to create a new environment, friendly to business and investment.

Our effort continues. It's a marathon. Nobody celebrates and cannot celebrate any positive developments because we still have an uphill battle ahead of us. In any case, we must show that apart from a country in crisis, we are starting to also see a country with hope.”

Deputy Minister Notis Mitarachi: "As it is already known, 2013 will be a particularly difficult year. We have been working hard so that it is a year of transition, the last difficult year of the recession. To achieve this goal, new investments are required, in order for new jobs to finally be created in our country, instead of these investments going to neighboring countries.

We met today with eleven dynamic companies operating in Greece, firms that since 2012 have already increased production in our country or intend to do so in the upcoming months. We had the opportunity to introduce a new Investment Law, and in this way to explain how our country is trying to make concrete business friendly steps, if for no other reason than to be able to tackle the huge social problem of unemployment. The measures we are taking in the export sector are of particular interest.

Many of these companies in Greece are aiming to use our country as a production base for export. The doctrine of "producing and exporting" is very important for the development and outward looking nature of the Greek economy.

We are therefore introducing these concrete actions to promote the improvement of the export process. Our goal is to reduce costs by 20% and export time by 50% within the next three years. We have also agreed with the companies that, in the near future, we are going to have a special meeting about exports, in order to present our plans in detail.

For us, during this very difficult year, it is important to see that there are optimistic signs: positive messages from Greek companies that are fighting, achieving and succeeding. "

Prime Minister Samaras: Greece Holds Key Role in European Energy Highway
Greece is placed on top of the major highways supplying all of Europe with oil, and all of southern Europe in natural gas, Prime Minister Antonis Samaras said at the International Herald Tribune’s Athens Energy Forum 2013 in Athens on February 25.

"Especially in Europe, where energy consumption is high yet energy self-sufficiency is low, any Member State contributing to diversifying energy sources and to the discovery of new sources, increasing the self sufficiency of all of Europe, upgrades itself and strengthens Europe overall," Mr. Samaras said.

The basic geopolitical dimension of energy is security, noting "security in supply, in other words, diversifying sources, and security in the transport of energy resources."

Greece is well positioned to produce and export Greek resources, he said, making special mention of the Trans Adriatic Pipeline (TAP), a project starting from Greece and transporting natural gas to Italy, and the hydrocarbon exploration in the Aegean. Greece could also guarantee the transport of energy resources by Greece’s merchant marine, the largest in the world.