Let’s get ready to rumble… again.

By?Constantine Capsaskis

Newsletter Editor

Welcome to the weekly round-up of news by Kathimerini English Edition. The commanding victory of New Democracy and Kyriakos Mitsotakis in last Sunday’s elections set the tempo across the Greek political spectrum this week.

Mitsotakis himself?returned a three-day mandate to form a coalition government?to President Katerina Sakellaropoulou on Monday, essentially paving the way for a return to the ballots.

This was hardly a surprise as New Democracy’s strong performance on Sunday all but guaranteed that it?would be seeking to achieve an outright majority, something that could be easier to achieve in elections carried out under the reinforced majority system which will apply in the next election.?

Main opposition SYRIZA and center-left PASOK declined mandates to form a coalition government, with a?constitutionally-obligated meeting of political leaders?convened by President Sakellaropoulou also failing to resolve the impasse. Elections will most likely be held on June 25.

Following the confirmation of a stalemate long foretold, Ioannis Sarmas, a senior member of Greece’s judiciary, was?sworn in as caretaker prime minister on Thursday.

On Friday, the?16 ministers who will form Greece’s caretaker government?were also sworn in. The Foreign and Defense ministries were given special attention with the appointments of experienced diplomat Vassilis Kaskarelis and former chief of the Army General Staff Alkiviadis Stefanos respectively.

During their first full-length meeting on Saturday,?Sarmas urged ministers to identify and mitigate any potential problems and risks?that could emerge in the coming weeks, making special mention of the deadly rail collision at Tempe.

Spotlight

• If there was one big loser in Sunday’s election,?it was main opposition party SYRIZA. The party of Alexis Tsipras woefully underperformed, dropping by almost 11% from the 2019 election. Throughout the week,?Tsipras made public statements taking responsibility for the disastrous result?but vowed to fight on in the next election and called for the party and its supporters to regroup ahead of the next ballot. However, after a result like Sunday’s,?some internal grumbling and squabbling?was only to be expected. Looking to embody “It ain’t over till it’s over”, among the measures introduced by SYRIZA to shore up support are control over the appearances of its candidates on media outlets as well as the creation of a new Election Committee, staffed primarily by younger party members and those perceived to be more broadly acceptable to the Greek public.

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• PASOK leader Nikos Androulakis stuck to his guns following the election and reiterated his refusal to participate in any coalition government,?something he repeated on Thursday. Instead, sensing an opportunity, it is clear that?the party will focus on competing with SYRIZA for second place?and the title of main opposition. However, despite the general feeling of exuberance in PASOK following its 40% increase on Sunday from 8.1 to 11.4 percent,?there were also ruffled feathers when Androulakis chose to keep a Thessaloniki parliamentary seat?(from his three options as a party leader) dislodging long-serving parliamentarian Haris Kastanidis who has been running in the same constituency since 1981 who called it a “personal insult”.

MUST READS

• Society is changing
• Operational slip-up
• The two challenges ahead
• A respected steady hand at the top of Greece’s diplomacy

OPINION

The “day after” with Erdogan at the helm

By Tom Ellis

Editor-in-Chief, Kathimerini English Edition

The re-election of Recep Tayyip Erdogan to another five-year term?ends the debate about how Turkey would behave towards Greece under a different leader?and, consequently, how should Greece deal with this reality.

In the same context, another question – for some, a concern – that was in the minds of many, will not be raised; and that was?if the US and Europe would have been more willing to support Ankara’s positions?under a seemingly more western oriented Turkish leader.

The election cycles – both presidential and parliamentary – in our neighbor are over and despitely the relatively thin margin, Erdogan will continue to be the all-powerful decision maker; one assumes?with the same revisionist approach for our region?and maximalist dreams for a global role.

Given the continuation of Erdogan’s presidency, two developments offer some, albeit limited, hope for moving the Greek-Turkish equation to a more positive direction.

First, Greece’s immediate reaction and sincere willingness to help Turkey after the painful devastation of the recent earthquakes has changed the atmosphere and?created room for Ankara and Athens potentially mending fences.

During the last few months, the foreign and defense ministers of the two countries met in a more hopeful climate and?in both cases expressed support for improved relations.

Second, if under the looming economic crisis, the Turkish President opts for – or is forced to pursue – closer cooperation with the West, then one can imagine a context in which the aggressiveness towards Greece recedes.

“It is in everyone’s interest here to work towards peace,” US Ambassador to Greece, George Tsunis, told me during a fireside discussion at the recent Delphi Economic Forum, sharing his belief that there is “a desire on both sides of the Aegean to seek peace and compromise.”

Although Erdogan might have changed the tone of his rhetoric from threatening to more conciliatory,?there are no signs he has abandoned nationalism as his guiding ideology. Will he push forward with the Blue Homeland doctrine and even the aim of changing the Lausanne Treaty?

Athens definitely prefers peace and cooperative coexistence and is willing to work towards that end, utilizing the International Court of Justice as a potentially necessary vehicle of getting there. In that context it depends on what does the Ambassador mean by “compromise”.

CHART OF THE WEEK

The export of Greek goods remains one of the prime drivers of the Greek economy, despite the strong resurgence of tourism. In fact, the export of goods gained ground over that of services with their proportion of the total exceeding 50% for the first time since 1998. This gradual improvement of Greece’s exports is largely a result of the financial crisis and subsequent fall in domestic demand that pushed many Greek firms to focus beyond the country’s borders. This, combined with implemented structural reforms, has strengthened Greek exports particularly between 2017 and 2020 (when the pandemic led to a dramatic reduction in exports).

ESCAPADE

Athens & Epidaurus Festival 2023: Greece’s Biggest Performing Arts Festival is Back!

Held annually from June to August, the Athens and Epidaurus Festival is one of the oldest performing arts festivals in Europe. Read on to find out more about this year’s program.

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ECONOMY IN A NUTSHELL

1. “The Athens Exchange (ATHEX) general index saw an?impressive weekly growth of 7.82% in the aftermath of Sunday’s election, closing at 1,220.89 points. This marked a new nine-year high.”
2. “The European Commission released its report on Greece this week and recommend a return to?tighter fiscal policy?as well as?further reforms to tackle a series of chronic issues, including tax evasion and inefficiencies in the public administration.”
3. “Greece’s short-term rental market continues to lead Europe in several metrics as there is high demand by both Greeks and international visitors. The?average occupancy rate increased by 9.2%?from last year, reaching 52.3% in April. The?average price per night also increased by 16.6%?year-on-year. “

WHAT'S ON THE AGENDA

29/05/2023

Parliament votes for its president: The parliament resulting from the elections of May 21 will meet on Monday, after being sworn in on Sunday, to vote for its new President,?before dissolving on Tuesday ahead of the second elections.

30/05/2023

Georgoulis immunity: The European Parliament’s Legal Affairs Committee reportedly agreed to postpone the decision on lifting the immunity of former SYRIZA MEP Alexis Georgoulis to this week. The former actor?has been accused of rape and sexual abuse.

01/06/2023

Panhellenic Exams: The nationwide exams for entrance into Greece’s state universities are set to begin on the 1st?of June.

PODCAST

The Greek elections, the markets, investors, and reforms

Wolfango Piccoli, co-founder of risk analysis company Teneo, joins Thanos Davelis to discuss the market reaction to the Greek elections, the message the election results sent to investors, the reforms that a new government in Greece will need to focus on, and more.