March 28. 2024. 10:56

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More than €600 million Recovery loans in the hands of few Greek businesses


Almost €622 million in loans from the Recovery Fund received by Greece so far has ended up in the hands of a few large companies while SMEs are struggling to get money from the banks, a press report in Athens has revealed, confirming information previously reported by EURACTIV.

“These are investments that belong to a total of 14 businessmen who could, in any case, secure bank lending if they wished, while at the same time, they show very high profits and therefore do not need the so-called cheap European loans, which are guaranteed by the Greek state,” the journal reports.

The journal pointed out, however, that it is normal for business giants contributing significantly to the country’s GDP to profit from the Recovery Fund regarding digitisation and green measures.

The report describes it as “surprising” that no money has so far been directed to the agricultural or livestock sector or small businesses that have seen their revenues decrease dramatically after the pandemic.

This information confirms a previous report by EURACTIV which highlighted the concerns of EU officials regarding the distribution of the Recovery funds in Greece.

Particularly, EURACTIV Greece quoted EU Commission circles expressing their fear that the vast amount of money flowing into the Greek economy by 2026 from the Recovery Fund will end up in a circle of businessmen close to the government.

“They fear that the current government is a victim of strong pressure and commitments to an enclosed group of Greek businessmen,” EURACTIV Greece reported in February 2022.

“This is a vicious circle that does not allow the economy to open to European and foreign investment,” EURACTIV Greece quoted one reliable source as saying.

In a surprisingly strong comment for the European Commission’s standards, its chief spokesman Eric Mamer had commented: “We won’t stoop so low as to comment on such a ludicrous and completely unfounded story.”

In July 2021, EURACTIV.com reported that several EU member states had asked the Greek government for clarifications regarding selecting the companies that would benefit from the post-pandemic recovery plan’s cheap loans.

The report was confirmed as Greece was the only EU member states forced to change its Recovery National Plan before its official approval.

A well-informed EU source had said the concern was that the Greek state would prioritise “safe” investments – which would receive money from the banks anyway – instead of more risky investments in sectors and SMEs that had been dealt a severe blow during the pandemic.

On 21 May, Greece will hold national elections, and the debate over handling the EU money from the Recovery Fund has heated up.

The Greek socialist party (Pasok), which ranks third in polls and is expected to play the kingmaker’s role, has said the next coalition government should allocate 8-10% of the Recovery Fund’s resources to health and social infrastructure.

Pasok leader Nikos Androulakis lashed out against the ruling New Democracy party (EPP), saying that It has allocated less than 5% of the total resources to healthcare while in neighbouring Italy and other countries of Europe’s south, the funding is twice as much.

For its part, the main opposition Syriza party (EU Left) has vowed to “re-direct” the EU money to the sectors in real need.

In July 2022, the ruling party’s majority rejected a proposal made by Syriza leader Alexis Tsipras to set up a cross-party parliamentary committee to monitor the distribution of the funds.

(Sarantis Michalopoulos | EURACTIV.com)

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