John Micklethwait: Kyriakos Mitsotakis, Prime Minister of Greece, thank you so much for speaking to Bloomberg again. Very nice to see you. I wondered if I could begin with the summer. Many people, perhaps including me, want to come to Greece. What will be the system for those people who have been vaccinated? Will there be more deals like you seem to be close to doing one with Israel, where people with vaccines will be able to come through almost automatically?
Kyriakos Mitsotakis: John, thank you very much for having me. I was the first European leader to raise the issue of a common European vaccine certificate, which will serve the purpose of simplifying travel, once a significant percentage of people have been vaccinated.
Essentially, a vaccine certificate will allow you to enter Greece without being forced to provide a negative test and without any quarantine restrictions. And we do intend to go down that path. We have agreed in principle with Israel that we will accept their vaccine certificate in order to facilitate travel from Israel to Greece. And I do hope that at some point at the European level we will also agree on a common certificate template for all European countries. John, πeople will want to travel, especially during the summer, and it doesn’t make much sense to me not to facilitate travel to the extent that we feel comfortable to welcome people who have been vaccinated.
For those who have not been vaccinated the most likely scenario is that we will request some sort of negative test. But for those who have been vaccinated, we want to make it as easy as possible for them to be able to travel to Greece. I see a lot of EU member states having an interest to explore this idea further. And I think the reason is that their citizens want to travel and they want us to make travel as easy as possible, especially during the summer holidays.
John Micklethwait: Are there specific things you will do with the places that people want to go to in Greece? The islands? Are you looking to vaccinate those people first in Greece? Are you giving any kind of priority towards the economy, in where you put your vaccines?
Kyriakos Mitsotakis: Well, first of all, Greece overall has done better than most European countries in dealing with the pandemic, which was sort of unexpected given that we entered this adventure with an underfunded health care system.
But if you look at our statistics, they are much better than most European countries. And we’ve also rolled out vaccinations faster than many other European countries. It is a completely digital process, which came as a surprise to many Greeks. And so far we’ve been able to vaccinate people at a relatively fast pace. Of course, we’re very dependent on the number of vaccines that we are receiving from Europe. I do expect the number of vaccines, come Q2, to ramp up significantly.
Right now our priority is to vaccinate older people. Then we will move to people with underlying conditions. And once we address these two categories, we will look at prioritizing vaccines. But by then hopefully we will have more vaccines and we will be able to administer them given the demand in Greece. And we do hope that come summer a significant percentage of the Greek population will be vaccinated. I should remind you that we opened up for tourism last year and we did it in a completely safe manner.
And during last summer we didn’t have the tools that we have at our disposal now. There was no vaccination and even in terms of testing there was limited testing available. Now we both have the vaccine protection and we have additional testing capacity, which, of course, is very, very helpful when you try to open up your country to travel.
John Micklethwait: How frustrated are you with the European Union in this respect? I mean, Greece was outstanding when it came to coping with the first waves of Covid. And now I think with the vaccine, you’re around six percent of your population. You are vaccinating people as quickly as you can get hold of the vaccine, but there is this problem about supply and that seems to go back to Brussels. How much do you think the Commission was at fault for that?
Kyriakos Mitsotakis: I’ve been an ardent supporter of the concept that Europe needed to purchase vaccines at the European level and then distribute them to all member states on a per capita basis, essentially making no distinction between rich countries, poor countries, large countries, small countries.
As a medium-sized European country we have benefited from this approach. Now, there’s no doubt that there were issues in terms of the execution of this project. And I think the President of the Commission, boldly enough, accepted her share of responsibility. And now we need to move forward to make sure that as new vaccines are approved this approval will happen very, very quickly and that we will not run behind other countries in terms of how quickly we actually receive the vaccines.
So I’m sure that even in Brussels, at the administrative level, at the bureaucratic level, the lessons have been… we’ve accepted what has happened and we’ve learned our lesson and we need to move forward to make sure that come March, come April, as new vaccines will be approved, that there is no further delay in delivering the vaccines to the member states.
Again, we have the capacity to administer many more vaccines that we’re currently administering and we have the infrastructure in place. It is simply a question of getting our hands on the vaccines and this is at the end of the day, a European decision.
John Micklethwait: Can you give us some idea of the economic cost of all this? As I understand the first quarter looks tough in Greece and presumably the lack of vaccines is becoming a major part of that.
Kyriakos Mitsotakis: Every time you close the economy you pay a heavy price and Greece has been no exception. We are no outlier. We are going to suffer a big recession in 2020. And Q1 is not going to look as good as we thought it would look like a couple of months ago. But again, we are not an outlier here. We’re not the exception.
If anything, we are currently in a sort of our third lock down. Hopefully in a couple of weeks we will bring cases down significantly, we can contemplate, again, reopening the economy. Very dependent on retail, obviously every time you close down retail there’s a big hit in terms of GDP.
But we’ve also supported incomes, we have supported the jobs. We’ve seen no increase in unemployment so far, which is very encouraging. Our intention was always to keep the productive base of the economy intact, so as to return to normality as quickly as possible. We did manage to keep retail open for three weeks in January with very, very encouraging numbers. March is hopefully going to be a better month again.
But other countries are in a much stricter lock down now. So Q1 is going to be difficult. But I do hope for a good and healthy recovery come Q2 2021.
John Micklethwait: I will come back to that in just a second. Do you think that this is going to be the last lockdown for Greece?
Kyriakos Mitsotakis: I sincerely hope so. I’ll tell you why. First of all, we are building a vaccine wall and, again, we’re not just vaccinating anyone.
We’re vaccinating those people who are the most vulnerable, the ones who are increasingly likely to occupy an ICU bed and possibly even lose their lives. So the challenge was always not to put too much pressure on our health care system. So we’re vaccinating a disproportionate percentage of those people who would put pressure on our health care system. And I think this will show, come March.
And of course we also have the added benefit of the weather. The weather in Greece is going to get better before it does in London, where I presume you are right now.
So, come April, there is a seasonal aspect to this virus. We knew it from last year. So, yes, I do think that come April things will improve significantly, in terms of virus transmissibility.
John Micklethwait: On the good side, I wondered if you could confirm whether you are going to repay early the IMF loan. I think you were talking about repaying 3.3 billion dollars out of the five-or-so billion dollars that you have borrowed. Is that still on track?
Kyriakos Mitsotakis: Yes, it is on track, John. We will repay 3.3 billion early, out of a 5.1 billion that we had borrowed from the IMF. I think it is very important to be consistent with the markets. They have rewarded us with record-low interest rates. Obviously this is a function of the significant amount of liquidity that is available. But I think it is also a vote of confidence in the ability of this government to deliver real reforms in the midst of the pandemic.
We’ve made Greece a more attractive destination for foreign investment. A lot of investors are looking at Greece right now and we want to be very consistent in the signals we send to the markets. So, repaying the IMF loan early, we had made that commitment and we are going to make sure we stick to our word.
John Micklethwait: How much do you think Greece’s reputation is changing? I remember, I think when you came in, very much then, people in places like Germany would look down on Greece and say they couldn’t run things. Now you’ve had this relatively good record of dealing with Covid, of growing, other things. Do you have a sort of aim in mind in terms of that? And how important is the arrival of Mario Draghi in Italy, from the point of view of changing the reputation of southern Europe?
Kyriakos Mitsotakis: I think it is important that in 18 months -we have been in power for 18 months now- we have dealt with several crises simultaneously, not just the pandemic. We had a migration crisis. We had a crisis with Turkey to deal with. And we’ve been, I think, relatively successful in dealing with all these crises simultaneously.
And I think we’ve also sent a signal not just abroad but also to Greeks that this Greek state, which was always considered to be inefficient and bureaucratic, when properly managed can deliver results to the benefit of the people. We’ve moved the digitization project of the Greek state very aggressively in the right direction. Greeks really appreciate that. And for the first time there is a sense that the state is really standing by people, is really helping them out, is supporting them, especially those who are more vulnerable. So I think this helps us with the Greek brand, both in Greece but also abroad.
Now, coming to your second question, I think Mario Draghi, his appointment as Prime Minister of Italy is excellent news for the European Union as a whole. I happen to know him personally because I met him during the Greek crisis. I think he brings tremendous credibility. He will bring tremendous credibility to the Council. And I think there is clearly a common agenda, a reform-oriented agenda, that I’m sure he will also deliver for Italy. There are some common threads with Greece, the green transformation, the use of renewable energy, the synergies when it comes to energy in general.
So, yes, I think he will do a lot to change these stereotypes of “north versus south”, which I think in a sense, John, were the legacy of the previous decade. I think in the new decade we need to look at things from a completely different perspective. And I do intend, as far as Greece is concerned, to make this a very successful decade for Greece, a confident country, punching above its weight.
We have submitted our recovery plan under the Recovery and Resilience Fund to Brussels. It has been received, I would say, very, very positively by institutions in Brussels. So now we have the additional firepower. We have additional capital, European public money to support our ambitious reform and transformation projects for the Greek economy.
John Micklethwait: It wouldn’t be an interview with Greece if we didn’t ask you at some point about Turkey. You’ve had difficulties in the Eastern Mediterranean. You had a very interesting speech last week, where you talked about Athens perhaps being the center of a new kind of Eastern Mediterranean. But all the same, you have this problem of sanctions against Turkey, where the rest of the European Union does not seem that keen on implementing them. Do you think Turkey, under Erdogan, can ever become a proper partner for the European Union?
Kyriakos Mitsotakis: We had a difficult 2020 with Turkey, with lots of tension. I do hope that 2021 is going to be a better year. And I think we’ve also made it very, very clear to Turkey that what happens between Greece and Turkey is also going to affect the overall relationship between Turkey and the European Union. Sanctions are never an end in themselves, but I do think that the threat of sanctions, if it is a credible threat, can force countries to change their behavior. And this is what I hope will also happen with Turkey.
We have started discussing with Turkey in a format we call exploratory talks, to resolve our one main difference, which is the delimitation of maritime zones in the Aegean and the Eastern Mediterranean. We’ve seen some months of lower tensions, I certainly welcome that and I do hope that we will continue down that path. We’re destined by geography, John, to be neighbors with Turkey. We’ve had periods of very good relations, in spite of the fact that some issues have remained unresolved.
So, I do hope that 2021 is going to be a better year. But at the same time we also intend to strengthen our alliances, to form alliances with a group of like-minded countries that respect international law. We’ve proven that complicated issues of delimitation of maritime zones can be solved in accordance with international law. We signed two agreements, one with Italy, one with Egypt, to delimit our maritime zones. So this is something that can be done, there is no dispute that cannot be resolved if we respect good neighbourly relations and we have a fundamental belief in the value of international law. And I do hope that at some point we’ll be able to see eye to eye with Turkey on this issue.
John Micklethwait: Optimism about Turkey and optimism about the summer. Kyriakos Mitsotakis thank you very much for speaking to Bloomberg.
