“Business is really booming,” says Evi Tsilou, Partner at Papapolitis & Papapolitis in Athens. “I think we are finally starting to see some developments — the time has come for investment and movement in business.”
This year the third economic adjustment program for Greece, designed to return the country to sustainable economic growth, will come to an end. “The crisis was tough for all of us,” Tsilou says. “But now, after all these years of crisis, all of us understand fully the dangers of being out of the euro zone and now we are confident that the likelihood of that happening is remote.”
Not all is perfect, of course, and Tsilou notes that “the consequences of the crisis are still here.” She reports that the biggest challenge for investors and domestic clients right now in Greece, “is still the uncertainty.” Current reforms in the country, unstable tax rates and bureaucracy, remain “serious impediments” for investors, she explains. In addition, there are still risks in capital controls, since the Greek government continues to impose restrictions —although relaxed — on money withdrawals outside Greece.
However, the adjustment program has brought positive changes in the public sector too, including efforts to modernize the public administration, reduce bureaucracy, and “help and expedite procedures in investment,” Tsilou says. These changes, she says, were necessary to make “all procedures effective and completed on time.” In addition, procedures related to judicial reform, bankruptcy and pre-bankruptcy procedures, NPLs, privatizations, and enforcement have been improved in the context of the adjustment program.
Among the most recent legislative changes are an e-auction that started at the end of February of this year, Tsilou says, describing it as an important tool in the context of enforcement. “Enforcement procedures were difficult, and e-auctions present important advantages for all interested bidders” she says. “The law on NPLs that was enacted almost two years ago sets also a significant set of rules and opened the way for an important number of NPL transfers to be completed.”
Tsilou reports that another area attracting an important amount of interest now in Greece relates to the placement of problematic businesses, mainly as going concerns, into a special administration procedure, which eventually leads “to a more quick and efficient sale of the assets of the borrower." She reports that "it is expected to be one of the most frequently used reorganization tools.”
In the long run, Tsilou sees an opportunity for growth in Greece. “The most promising areas are of course the NPLs and M&A and capital market deals with a focus on the tourism sector,” she says. Although she notes that in the privatization area there is still work to be done, “many privatization projects are already completed and for others the process is currently ongoing.”
Ultimately, she says, she's hopeful. “We are quite optimistic that things are going to be better for everyone here in Greece and that 2018 will be the beginning of the end of the financial crisis in Greece.”