The best historical performance in the number of direct foreigners achieved in 2023 Greece while improving their quality composition, according to the “EY Attractiveness Survey Greece 2023” conducted by FT Longitude, between 8 March and 4 April 2024. According to the survey, in 2023 Greece attracted 50 FDI, compared to 47 in 2022, with the growing trend in recent years continuing. It is typical that, of the 386 projects in the investments recorded in the European Investment Monitor (EIM) database from 2000, half (49%) were carried out from 2019 to today. And this happened at the time when the overall picture of investments in Europe was discouraging and between 2000 and 2017 annual investments in Europe tripled, after 2017 they retreated by 14%. Equally important is the continuing improvement of the quality of investment composition. For example, between 2000 and 2022, 44% of FDIs were directed to sales and marketing offices, an activity with relatively low added value. In this year’s survey, the corresponding rate was 12%, while 48% concerned services to businesses. There is also a reduction in investment in industry. On the basis of the economic sectors, in the first place, with 24% (17% in Europe), there is the software and IT services sector, characterized by knowledge-intensive intensity. As George Papadimitriou, CEO of EY Greece, explains, “what is important, is that the improved image of the country as a potential investment destination is linked to an effective policy for attracting international investors.” According to him, almost eight out of ten (79%) respondents described Greece’s attractiveness policy as effective – a percentage improved by three points since last year. At the same time, and according to research, the best performance of this policy is recorded in attracting businesses (72%), innovative activities (71%) and human talent (68%). Moreover, factors that bring together positive – but lower scores – are attracting capital and creating centres of competitiveness and world-wide nodes. ” Compared to 2019, all indicators concerning the effectiveness of the country’s investment policy appear significantly improved, as then none of them exceeded 50%!” Mr Papadimitriou points out. At the same time, participants in the investigation were asked to report where they believe the country should focus its efforts to maintain its competitive position in the global economy. Three issues have been firmly at the top of the ranking in recent years: improving the education system and human resources skills and facilitating access to human capital (28%), reducing taxation (27%) and supporting high technology and innovation sectors, such as clean technologies, etc. (24%). “In fact, on these issues we will be judged to a large extent in the coming years, without wanting to underestimate other equally important aspects,” notes Mr Papadimitriou and continues: “In the proposals that, like every year, we submit in the context of the investigation, we are talking in detail, in areas we should focus on to better place the country on the global investment chessboard. It is the strengthening of human resources skills, the exploitation and development of artificial intelligence, the strengthening of research and development, the strengthening of sustainable development through the exploitation of the comparative advantages of Greece, the creation of a more attractive tax system, the acceleration of the pace of administration of justice, the strengthening of infrastructure to exploit the opportunities created by the trend of reshoring, the growth of small and medium-sized enterprises, as well as the transformation of domestic industry and the attracting of industrial investment.” Enhanced availability of investors Despite the fact that in 2023 – as in previous years – most indicators improved, Mr Papadimitriou stands in the big picture, since research is already in its sixth edition. Specifically, as he points out by talking to the APE “more than half of the respondents in the sample (51%) said their businesses are planning to develop or expand their activities in Greece during the next year – compared to only 30% in 2019! At the same time, more than six out of ten (62%) said that in the last year their view of Greece has improved, as a place where their business could develop or expand its activities.” In the investigation, participants were asked to assess Greece’s performance on the basis of a number of criteria related to the most critical factors currently affecting investment decisions: sustainable development, electricity, technology, human resources and taxation. “These elements give us a good ‘image’ of our strong papers and the points where more work is needed,” Mr Papadimitriou points out. For example, on the issues of electricity, which, as you understand, are at the top of the agenda today, the share of low-carbon electricity in the mixture is positively assessed by 70%, but it concerns (49%) the cost of electricity. In technology, the availability of human resources with technological skills (70%) – and indeed many technological giants are installed in Greece (e.g. in Thessaloniki or Ioannina) to make use of Greek graduates is very positive. However, as a recent survey by EY with the OPA Electronic Business Laboratory and Endeavor Greece finds, offering graduates to technology today is difficult to meet demand and we will find this problem ahead of us over the next few years. According to Mr Papadimitriou, this impressive improvement, both in terms of the number of FDIs and in terms of the image of the country, begins at a low starting point. “Personally, I prefer to compare our performances with those of the countries that compete with us, rather than the average performance of the past. Because, in this European investment pie – which seems to shrink – we have to compete with strong economies that strengthen their position, such as France, but also regional economies, such as Portugal, Turkey and several Eastern European countries that, like us, support their development in extroversion and attracting investment,” he stresses and complements: “To note here, too, that the trend of reshoring—redesigning, i.e. supply chains and moving activities closer to the domestic markets of large companies—is a great opportunity for economies located on the outskirts of Europe, such as Greece, especially for investments in logistics, but also in industry. This opportunity we cannot afford to miss.” Source: RES-AE