Forging ahead

For two-and-a-half years, Greece was on the chopping block, accused of being not being either able or willing to introduce change. But now, one of the country's harshest critics, German Chancellor Angela Merkel, has said that Greece is both. Her sympathetic remarks may have involved a bit of political calculation, but Merkel would not have made them if she wasn't convinced of a paradigm shift in Greece.

Jens Bastian, a member, of the Task Force for Greece, has come to the same conclusion. The EU Commission launched the task force last year to provide technical assistance to ministries and government agencies, to show them how to work more efficiently and implement the international creditors' reform program.

The Greek budget is a good example for Greece's willingness to change, Bastian told a conference organized by the Heinrich-Böll foundation. Despite the problems, reforms implemented over the past 18 months have allowed the government to set up a transparent national budget.

Transparency

For the first time, there's not only more transparency but also "a flow of information that gives government offices the opportunity to find out about expenditure in the budget: who spends what amounts, is that acceptable and were contracts awarded according to the law?" Bastian said.

But not all sectors are transparent. For example, a land-registry office simply does not exist: the state has no idea what it owns. That is one of the main reasons why there is no progress to speak of in sales of state-owned real estate, Bastian said. In addition, many state-owned firms earmarked for privatization face investigations in Brussels on the grounds that the Greek government granted them subsidies and tax privileges that violate EU laws. The firms can not be sold before the investigations are completed. The Task Force is helping Greece finalize the "complex, time-consuming" procedure, Jens Bastian said: "It is in Greece's own best interest not to be summoned before the European Court of Justice."

Media reports have often dwelled on Greek authorities' problems in collecting taxes and the relative lack of interest among politicians in creating tax equity. There have been changes here, too, Bastian said.

Building a modern Greece

Athensis negotiating an accord with Switzerland to get a handle on Greek tax refugees: "We're on the verge of signing the agreement," said Bastian. "There already has been some capital flow by Greeks from Switzerland back to Greece: ahead of the law that's on its way they understand they evidently must act."

Bastian also sees progress concerning assistance from the European Regional Development Fund (ERDF). Greece has received eight billion euros ($10.3 billion) of the 20 billion euros allotted for the period 2007 to 2013. Most of the remaining 12 billion euros are linked to specific projects. The Task Force helped define projects and create the necessary administrative structures.

According to Jens Bastian, the changes in Greece also affect the International Monetary Fund, the European Central Bank and the European Commission - known as the troika: "The troika itself has changed a lot - its members are learning." He says the troika should not be viewed as a homogeneous entity, as it has become evident over the last few weeks that there are "enormous debates among members of the troika concerning the route and priorities." Change in Greece, he said, requires new answers.