EY: The attractiveness of the country as an investment destination is durable, despite the uncertainty of the international environment

In an environment of increased uncertainty in Europe, but also the whole world, the attractiveness of Greece as an investment destination is proving to be resilient. 37% of businesses plan to invest, or expand their activities in our country, during the next year, while three out of four investors (75%) estimate that the attractiveness of Greece will improve further in the next three years. These are some of the findings of EY Greece’s fourth major survey, EY Attractiveness Survey Greece 2022, on the attractiveness of the country as an investment destination, which was conducted by Euromoney between March 15 and April 15.

The official presentation of the survey was made by the CEO of EY Greece, Mr. Panagiotis Papazoglou, at the opening session of the 5th InvestGR Forum 2022: A New Greece Emerges, which took place on Wednesday, July 13.

The timing of the investigation and the effects of the war in Ukraine
The war in Ukraine has inevitably created a negative psychology in the global investment community. The survey on Greece captures this mood more strongly, as it was one of the last surveys conducted in Europe, when the long duration of the conflict and its economic effects had become common consciousness. It is characteristic that one in three companies (32%) declares that it has delayed its direct investment plans for Greece until 2023, or even later, as a result of the war. However, more than half of respondents (54%) respond that there have been no changes in their planning, while 13% of respondents report that they are proceeding with a small (<20%) increase in planned investments.

Second best year in terms of the number of FDI in Greece, while the qualitative composition of investments continues to improve

According to the EY European Investment Monitor, an extensive database processed by EY, 30 foreign direct investments (FDI) were made in Greece in 2021, a number that is the country’s second best performance since the start of the survey in 2000, after last year’s record number of 39 investments. Cumulatively, the investments of the last two years represent 24% of the total investments made in the last 22 years. In 2021, the shift towards investments with high added value intensified. Based on the type of activity where the investments are directed, 30% concerns investments in corporate headquarters (headquarters), compared to only 4% between 2000 and 2020, and 7% in the whole of Europe in 2021, while in second and third place are respectively industrial activities (20%) and logistics activities (17%). Based on the sectors of the economy, at the top of the ranking are agri-food (20%), transport and logistics (20%) and software and IT services (17%), three sectors associated with significant comparative advantages of the Greek economy : the quality of its agricultural products, its geographical location and the skills of its human resources.

The mood for investment and optimism for the future is increasing

The percentage of businesses planning to invest, or expand their operations in Greece, over the next year, despite the difficult geopolitical conditions, increased for the second year in a row, reaching 37%, up from 34% last year and 28% in 2020 .

At the same time, 58% of the survey participants state that their view of Greece as a place where their business could develop or expand its activities has improved over the last year, a marginally reduced percentage compared to 2021 ( 62%), while three out of four investors (75%) estimate that the attractiveness of Greece will improve in the next three years, a percentage that ranks Greece in first place among the countries under comparison, but also compared to the whole of Europe ( 64%).

Vote of confidence in individual attractiveness policies

A significant improvement is recorded in terms of the views of the investment community regarding the policies followed to improve individual aspects of the country’s attractiveness. This finding seems to confirm that investors attribute the improvement of the country’s image to the implementation of specific policies and no longer to the timing and the end of the period of uncertainty caused by the financial crisis. Specifically, policies for attracting businesses (81%), attracting human resources (78%), attracting innovative activities (75%), attracting capital (65%), attracting headquarters and decision-making centers ( 58%) and the creation of competitiveness centers & global hubs (55%).

Comparative strengths and weaknesses of the country

The quality of life (75%), the transport and logistics infrastructure (73%), the telecommunications infrastructure / digital infrastructure (72%), the internal market of Greece (72%) emerge as strong cards of the country’s attractiveness. , as well as human resources skills (70%). On the contrary, the flexibility of labor legislation (46%), the geopolitical position of Greece (47%), the education system (48%) and access to financing and availability of funds in Greece (48%) are highlighted as less attractive elements.

Sustainable development, technology and human resources

The survey participants also evaluated Greece based on a series of criteria related to sustainable development, technology and human resources, three of the most important factors influencing investment decisions today, and to which Greece has given special attention. emphasis in recent years. In all the individual sectors, the majority of respondents consider that Greece’s performance is similar to, or even better than, the European average. However, in several areas, there are also significant minority percentages of respondents who consider the country’s performance to be lagging behind its European counterparts, recalling the tough competition and efforts that all European countries are making today to attract investment.

Priority areas to enhance the attractiveness of the country

Investors estimate that, in order to improve its position, Greece needs to focus on improving the education system and human resources skills (40%), supporting innovation and high-tech sectors (37%), reducing of taxation (33%) and the support of small and medium enterprises (27%).

Finally, an impressive 90% of businesses, and 83% of representatives of businesses that do not yet have a presence in Greece, compared to 86% and 62% respectively last year, state that they would be more willing to invest in the country, if the negative points that today they act as a deterrent.

The proposals of EY

Through the research, EY Greece submits a set of proposals aimed at further improving the attractiveness of the country, which move along 10 main axes:

– Human resources and skills
– Digital technology and innovation
– Sustainable development and renewable energy sources
– Logistics and infrastructure
– Refocusing on industry
– Taxation
– Bureaucracy and justice
– Small and medium enterprises
– Recruitment for more effective communication abroad
– Political stability

The Prime Minister, Mr. Kyriakos Mitsotakis, submits to the survey his opinion regarding the improvement of the country’s image and refers to the steps that have already been taken and those that need to be done, emphasizing:
“The effort continues. The state is becoming digital, but it must also become more efficient overall. The administration of justice should be speeded up. Other sections, such as those in training, have been voted on, but they still need to be implemented correctly. While many other investments are planned, but their planning must be completed and announced. Greece must and can be one of the first investment destinations in Europe.”

In addition to the Prime Minister, their views on the importance of foreign investments for Greece are expressed in the survey, and the Ministers, Mr. Christos Staikouras, Minister of Finance, Adonis Georgiadis, Minister of Development and Investments, the Governor of the Bank of Greece, Mr. Giannis Stournaras, as well as Mr. Dimitris Papalexopoulos, Chairman of SEV, Chairman of the Executive Committee of TITAN Group and Nikos Vettas, Director General of IOBE and Professor, Athens University of Economics and Business.

Recruitment to face the intensifying competition

Presenting the research, the CEO of EY Greece, Mr. Panagiotis Papazoglou, said: “In a year of growing global uncertainty, the attractiveness of our country as an investment destination remains high, thanks to the important steps taken in recent years. This conquest, and the broad consensus, around the imperative need to attract foreign investment, with well-paid jobs and high added value for the national economy, we must guard it, through the mobilization of the political and productive forces, the public administration, but also the Greek society. We must remember that we are operating in an extremely competitive European and global environment, in which all countries are today intensifying their efforts and moving at a rapid pace to further enhance their attractiveness. with our previous performances!”.