Regaining investment grade status after 14 painful years is definitely a moment of celebration for Greece and our citizens. However, if we want this bleak period of our modern history to never happen again, it should also be a moment of reflection. After all, mistakes of the past are destined to become our fate for the future if we don’t acknowledge and learn from them.
I would summarize them in 8 points:
Lesson 1: A fair but disciplined fiscal policy is the best and only safeguard to address social inequalities. Fiscal deficits and high public debt mortgage the future of the most vulnerable groups of our society.
Lesson 2: An internationally competitive, open and extroverted economy based on local manufacturing and exports, a wide use of renewable sources of energy and digitization of the state and enterprises provides a robust environment for growth. Strategic autonomy and trade surpluses are key for any modern economy.
Lesson 3: Counter-cyclical economic policies – fiscal expansion during economic recession to keep businesses, jobs and incomes at tolerable levels, and correspondingly a tighter fiscal policy of savings in the good days of economic growth – work as a shield for any economy against the shocks of international and national economic turmoil.
Lesson 4: Crises always work also as opportunities for reforms and modernization. We saw it during the pandemic and the energy crisis with the recovery and resilience fund of 750 billion euros, the first attempt of the EU to undertake collectively common debt. The European Union has created, due to the Greek debt crisis, a set of important tools of economic governance, fiscal, financial and political integration.
Lesson 5: We learned the hard way that populism never has the appropriate solutions and answers to the – many times correct – questions it poses. Our world is now too complex to be left in the hands of irresponsible and dangerous populists.There are no magical solutions to difficult problems.
Lesson 6: never forget the agenda of social justice and intergenerational solidarity out of your policies. Keep a close eye to the younger generations. The new Greece we aim to build must be a fairer and more inclusive Greece for all Greeks especially without exception, with a real redistribution of opportunities and resources to young people, women, residents of rural regions but also of degraded areas of urban centers, people with disabilities, LGBTQ+.
Lesson 7: Triangulation of politics and ideologies works. In our case, lower taxes stimulated domestic and foreign investment which led to dynamic growth but also to the expansion of our social safety net. However, you can’t have economic growth, prosperity and social inclusion without providing safety in the cities and protection in your borders from illegal immigration.
Lesson 8: Embrace your mistakes, take responsibility for them and move forward by addressing and correcting the root causes that led to them. People acknowledge and appreciate more a politician or a government that shows empathy, admits mistakes and doesn’t pretend to be perfect. With no trust there is no us.
Governing in a context of global polycrises that put to test even the strongest of nations and economies can be quite a challenge. Doing it with prudence, responsibility, concrete results and evidence based policy making proved to be in the case of the current Greek government the right path to regain investment grade and reclaim successfully a second term.
* Akis Skertsos, is Minister of State of Greece