By Antonis Kamaras

A new wave of money is crashing on the shores of Greek economic life, originating from hedge funds and private equity investors. Fears are being raised that the leadership of the country’s corporate flagships will be turned over to anonymous and uncontrollable entities. Interestingly enough though, if we look at the funding of two of Greece’s highest-profile direct equity investors, Global Finance and Marfin investment group, which have recently raised 350 million and 5.2 billion euros respectively, we will find among their key sources of capital that element which is as old as Greek entrepreneurship itself, namely Greek shipping. This is yet another demonstration of a key feature of globalization: the fact that globalization is shaped, within national territories, by repatriated capital and know-how. In this way, globalization is nationalized, which is to say that it becomes embedded within the national community where it takes place.

Essentially, as economies open up they have a natural advantage in attracting accumulated know-how and capital from their expatriate elements, which, due to the restrictions of the past, had historically sought their fortunes outside the national territory. Protection (as much as liberalization) always reinforces itself in what we might call virtuous or vicious cycles, depending on our ideological preferences. Protection, by compelling some of the most dynamic elements of a society and an economy to leave their country, further entrenches its own mentality and practices, within its particular national territory. Conversely, liberalization by attracting these same dynamic elements that protection had previously expelled, accelerates its velocity and dramatically extends its reach.

Thus the liberalization of the 1990s initially facilitated the repatriation of Greek shipping, as privatizations in Greek telecoms and banking massively improved the operational infrastructure available to Greek shipowners. Furthermore, liberalization made available a wide range of assets to Greek shipping, thus making Greece (and the wider region of the Balkans which has also been undergoing liberalization) an important component of shipping’s enduring strategy of risk diversification. Last, but surely not least, from the point of view of repatriated Greek shipowners, liberalization created a culture of acceptance, as opposed to rejection, of great wealth and legitimated its participation and visibility in Greece’s public life.

We can compare Greek shipping to the Indian IT magnates that established themselves in the same period. In India, too, economic liberalization encouraged the so-called non-resident Indians, most prominently Indian technologists excelling in places such as California’s Silicon Valley, to invest in their motherland. They in turn created the global outsourcing wave, which materialized in cities like Bangalore, the functional equivalent of Greek shipping’s Piraeus, which now world-renowned companies such as Infosys represent. Liberalization, implemented and legitimated by Indian political forces, meant that the egalitarian priorities of Gandhi-Nehru vintage, encapsulated in the expression of a ‘Hindu rate of growth’ (i.e. of an economy which will not lose its anti-capitalist restrictions for the sake of accelerated material development) lost its unquestioned dominance. As in Greece, a culture of entrepreneurial achievement, and the material distinction that goes with it, was consecrated by politics thus making the country friendlier to the US-trained, hyper-competitive, non-resident Indians.

Importantly, such repatriated elements ― Greek shipowners, Indian IT entrepreneurs ― benefit home-grown liberalization as much as they benefit from it. By successfully relinking with their countries of origin they come to define the latter’s role in the global setting and to conceptualize anew their countries’ position in altered global hierarchies. Shipping has become a pillar of the Greek government’s projection of an ‘extrovert’ Greece, meaning a country successfully and confidently interacting with globality. Likewise India’s IT corporations have irretrievably undermined perceptions of India’s identity as a champion of the downtrodden, underdeveloped and globally disadvantaged Third World.

By enabling such redefinitions these repatriated elements assist in the nationalization of the politics of adjustment to global processes. Opening up to global capital flows, growing domestic competition and so on becomes more acceptable and the politics and policies that facilitate such changes gain in durability, to the extent that they come in a package that includes the projection of national economic prowess onto the international domain. This is the role that the Greek-owned commercial fleet plays, symbolically by its global pre-eminence and materially by repatriating billions of dollars to the Greek national economy every year, providing income to tens of thousands of high-salary employees in Greece, and channeling part of its tremendous excess liquidity to Greek entrepreneurship in Southeastern Europe.

As we delve deeper into this nationalization of the global in Greece, by Greek shipping, the following key questions need to be addressed, from a public policy and analytical perspective:

1. What are the key features of the shipping cluster of Piraeus and Attica today? How does it compare and compete with other shipping clusters, such as London, Hamburg or Rotterdam? What is the set of public policies that could sustain and extend this cluster’s success well into the future (whether these relate to infrastructure, lifting remaining restrictions in shipping-related professions or upgrading merchant marine education)?
2. What are the synergies between shipping and other sectors of the Greek economy, and how can they evolve? What could be the set of policies that would enlarge the space of opportunity, either in Greece or in the region, for shipping’s interaction with the Greek economy?
3. How are the interests of Greek shipping advanced internationally by the Greek state? Has shipping been sufficiently integrated by Greek policymakers in the projection of Greece’s particular identity and role in the international system?
4. How does shipping interact with Greek society? What could be the set of measures in the status of charitable activities and in the institutional environment that structures education, health and the arts in Greece that would encourage and enable Greek shipowners to make a substantial contribution to the Greek common good?

Antonis Kamaras worked in Istanbul in the financial sector from 2003 to 2006.

Source: The Bridge