Prime Minister Kyriakos Mitsotakis’ remarks during his conversation with Enrico Letta at the 28th annual “Economist Government Roundtable”

Prime Minister Kyriakos Mitsotakis participated in a conversation with the President of the Jacques Delors Institute and former Prime Minister of Italy Enrico Letta, in the framework of the 28th annual “Economist Government Roundtable”, held at the Glyfada Golf Course “Konstantinos Karamanlis”. The discussion was moderated by Daniel Franklin of “The Economist” magazine. The remarks by Kyriakos Mitsotakis follow:

Referring to the result of the European elections at EU level, the Prime Minister stated at the beginning of the conversation:

“Well, first of all, it clearly pays off to systematically show up at your conferences. I hope that was not the primary reason for voting us ‘country of the year’, but thank you, regardless, for that great honour.

Now, turning to the European elections, let me, first of all, point out that when you look at the mathematics of the European Parliament, it is very clear that the European political centre, as it is represented by the three main political families, the European People’s Party, the European Socialists, and the European Liberals, has a comfortable majority in the European Parliament. It is actually the only working majority, which was also the reason why the discussions around the main jobs essentially centred around the three political groups.

I think that the hard right or the far right, it probably did slightly worse than many people expected before the elections. However, they clearly made their presence felt in France and in Germany. Of course, this is a development that has obvious consequences for both these countries, the most dramatic ones are taking place in France as we speak, because the outcome actually triggered a parliamentary election. It is indeed interesting to point out that these days there is concern about the fiscal position and the borrowing costs of France, whereas Greece, which was the poster child for the fiscal problems of the European Union, seems to be doing rather well and is a pillar of fiscal stability.

I think that it is very important to preserve that working majority and to ensure that the new Commission President gets to the 361 vote threshold in the European Parliament. My expectation is that this will actually happen. Then for Europe to get down to work, to deliver on essentially the pillars of a new European policy that will look at issues around competitiveness.

I would like to congratulate Enrico on his truly excellent report. He put a lot of effort and energy into writing this text, and it was clearly for him not just a procedural obligation. There are many interesting thoughts and ideas which I’m sure we’ll have a chance to discuss coming out of this report. But how do we actually make the single market work in those sectors where we clearly have challenges, other new freedoms that we need to enshrine in our collective European logic, all these are important questions which also, to a certain extent, answer to the grievances that Europeans feel.

Of course, then we need to look at issues such as defence, migration. These are topics which will feature prominently in the next European cycle. But I think it is important to get the top jobs out of the way relatively quickly because there was a lot of drama last time.

I think that the more predictability and speed we have in sorting out the remaining, confirming Ursula von der Leyen and then confirming the rest of the Commission, the better it will be for Europe”.

On the result of the European elections at national level, Kyriakos Mitsotakis noted:

Kyriakos Mitsotakis: The one conclusion is that New Democracy remains the one dominant political force in Greece, the second and the third party, if you add up their percentages, they’re under the percentage that we got.

Clearly, we had set a target at the election result of the 2019 election. We did not get to 33%, and I think there are various reasons for that, which I take very seriously. It’s not just fatigue with consecutive elections, I’m sure that played a part. We had very high levels of abstention, I’m sure there were also citizens that decided to use European elections to send us a message, concerned with the cost of living. I think this was a very, very important priority that is very high upon the agenda of most people in the country.

But at the same time, the European elections did not change the fundamental political dynamics. We had a double national election in 2023. We managed to get to 41%. We managed to demonstrate that you can actually have a center-right party that has a very broad appeal and can bring together people who identify as right-wing, but also people who identify as progressive centrists. I think this has been something which has proven rather elusive for many other traditional, large European parties.

Of course, that victory was reflected in a strong parliamentary majority. We have a mandate for four years to deliver upon complicated reforms. If the first four years were about stabilising the country, and I think we’ve succeeded in that, the next four years is really about catching up with Europe and about making sure that we don’t just rest on our laurels, but that we really push an aggressive convergence agenda with Europe.

We have three years remaining in our term. There will be no early elections. I’m adamant about that. Elections will take place in 2027. I was equally adamant during my first term. Many questioned my commitment to a stable electoral cycle. They were wrong. They will be wrong again. We will have an election in 2027, and we will be judged in our entirety on what we have delivered in our second term.

Daniel Franklin: You’ve clearly been keen to listen to the message from voters. Does the message lead you to think that reforms should be speeded up, slowed down, as before? Is there any message there?

Kyriakos Mitsotakis: I’m a committed reformist. Even if reforms sometimes ruffle feathers, that is the nature of the reform agenda. But we received a mandate for these reforms. For example, if we go after tax evasion, as we committed to do in our electoral manifesto, I’m sure some people may be disappointed with that, but at the end of the day, everybody recognises that it is the right thing to do.

For me, the message is very clear: focus on deliverable results. We want you to address issues of cost of living. This actually relates to the functioning of the single market, at least in one dimension, and that is the prices that we pay for products produced by multinational companies. When we had our discussions with Enrico, it was an issue I pointed out. We cannot have the similar or identical products being sold at significantly different prices in a single market. This is not acceptable, but people want better health care.

At the end of the day, the focus needs to be on disposable income, on wage convergence. This is our main commitment, and this doesn’t happen miraculously or by government decree. You need investment, you need growth, you need to bring down unemployment.

All the figures are trending in the right direction. The economy is growing at a significantly faster pace than the rest of the Eurozone. The country is an attractive investment destination. We have created almost 400,000 new jobs over the past five years. If we continue to deliver on these reforms, we will achieve the targets that we set by 2027 in terms of a significant improvement in disposable income.

I think the message was “just get down to work and do what you told us you would do, because that was the reason we were voted back into office in the first place”.

Regarding the challenges the EU is facing, the Prime Minister stressed:

“First of all, let me agree with what Enrico said regarding the comparison of where we were in 2019 and the debate in 2024. I would argue that these five years, in spite of the challenges, have helped us, Europeans, to move in the right direction in the sense that through very difficult compromises, we took extremely important decisions.

None more important, in my mind, than the creation of the Recovery and Resilience Fund, which was a momentous decision to take because for the first time, we resorted to European borrowing to fund very, very specific initiatives post-COVID, but which, however, also fit with our broader strategic agenda, the green and digital transition, and issues of competitiveness and social cohesion.

I think sometimes we underestimate the importance of this decision. For Greece, this means €36 billion of grants and loans. But this money is not given away for free. There is very strict conditionality, a clear connection to the reforms we need to implement, and I think a tight methodology that gives comfort to those countries that were more sceptical about this decision, that the money is indeed well spent.

Why am I raising this issue? Because if you look at the goals that we have set as a European Union, the green transition, the digital transition, issues around competitiveness and social cohesion.

What you mentioned is, I think, extremely important, this ‘right to stay’ is indeed a very powerful notion that goes against the idea that Europe is only for the Metropolitan elites who can travel from one country to the other.

Defence and whether we can do something meaningful at the European level around defence. When you look at our ambitions and our financial firepower, it seems to me that there is a misalignment. The challenge is, how do we mobilise more public and private capital to achieve these important goals that we have set?

When you look at defence in particular, in a post-Russian invasion to Ukraine, again, we all acknowledge that we want to do more with defence, but we recognise the limitations of our national budgets, which are very real. Greece is a country which has systematically exceeded the 2% threshold of defence spending as a percentage of GDP, unlike other countries which for decades took advantage of the peace dividend and diverted this additional spending into other directions. We did not have the luxury to do that.

But if we really want to be serious about defence, we also need to identify European projects with European technology that serve common European goals. That is why I proposed with Prime Minister Tusk, this idea of a common European defence shield, yes, which would be funded from joint European borrowing.

Sometimes I hear the skeptics saying, ‘okay, this is not exactly within the scope of the treaties’, but at the same time, this is exactly what we’re doing with Ukraine: we’re using European money to buy arms for Ukraine. When there’s a will, there is a way.

But we need to make sure that whatever we do in defence also supports the defence industry in Europe. Because it is strange that we are increasing our defence spending, but most of the spending does not necessarily go to Europe. It goes to the US.

The same, of course, is true when you look at our capital markets. If you look at the private capital side of the equation, we have all these huge pools of European savings that are actually directed into the US, only to be possibly reinvested into Europe by wearing a US hat. Does this make much sense? Probably not.

That is why the whole discussion around capital markets union, which was also highlighted by Enrico in his report, is so meaningful and so important.

The idea of whether we will have, to put it very simply, a second RRF post-2026. What would that mean? How would this tie into the structural funds and the Common Agricultural Policy, which are pillars of the European budget? I mean, these are important topics that need to be discussed.

The next Multiannual Financial Framework is not that far into the future. I think we’d better start this discussion now. But it seems to me that defence in particular is an area where we can mobilise a new momentum to create European solutions that would, again, address European security needs and will also develop European technology. We have the technology in Europe to do what I describe. It’s also spread out amongst many European countries.

Of course, because we will find ourselves at the NATO Summit in 10 days, I would argue that this is fully complementary with NATO and can also be fully integrated into the NATO structures because our American friends have been systematically asking us Europeans, ‘spend more, do more for your collective security’. I don’t see this as an initiative that would necessarily compete with NATO. I’m sure that the NATO generals would be very happy if we had more integrated air defence systems protecting the European skies”.

On EU-US relations and the competitiveness of the European market, the Prime Minister said:

“First of all, no matter how hard you will push me, I will make no comments about the US elections for reasons which I’m sure you fully understand. I’ve worked with both President Trump and President Biden.

But I do need to point out that when it comes to big decisions taken by the US, by the current administration, some of these decisions were taken clearly through an America first lens. When the Inflation Reduction Act (IRA), which is essentially a piece of protectionist legislation, was passed, it was not exactly that we were extensively consulted.

What we are currently seeing, not simply because of the IRA, but also for other reasons that Enrico mentioned, is when you ask the big European companies, not the American companies, whether they choose to invest in Europe or in the US, they are voting with their feet. This in itself is an indication that we actually have a serious problem. I don’t expect this approach to drastically change.

The question is, how quickly can we adapt to this new reality, especially when it comes, for example, to the green transition? It is indeed striking that we have set the most ambitious targets in terms of the reduction of CO₂. But when you look at the technology behind achieving these targets, it doesn’t seem to me to be European technology.

We’ve actually lost our competitive edge in sectors such as renewables or even electric cars. The automotive sector in Europe is currently struggling to adapt to this new reality.

It is Chinese competition, heavily subsidised Chinese competition. But at the same time, we also have American companies, which leapfrog European companies without state subsidies. We have to be honest when we look at the mirror in terms of what exactly is happening.

On the one hand, you have a protectionist system of state-sponsored capitalism. On the other hand, you have a very dynamic free economy, which is also choosing to use additional stimuli of public money, because it can afford to run a huge deficit, because it is the country that can actually afford to do that and because the markets will continue to finance it. We seem to be stuck in the middle. This, for me, is the big strategic challenge that we need to face over the next electoral cycle.

And, of course, returning to the question of defence, there it is very, very clear that we need to do more to protect our own continent, I think I’ve elaborated, but again, in terms of also developing our industry.

One final point, because I think what you said about farmers is so important. It also brings us back to your first point, centres versus rural. At the end of the day, at a time when food security is critical, so you have the agricultural sector. Αround 10% of emissions in total, if I’m not mistaken, but critical in terms of the right to stay where you live, because farming by nature does not take place in the big cities.

At the same time, we impose a speed of adjustment to our farmers without giving them the tools to actually adapt also to foreign competition from countries which are not faced with the same regulation. It doesn’t really make much sense. There are other areas where we could move much faster in terms of reducing our emissions. But again, there I would be looking for home-grown European technology to be developed.

Let me give you another example: nuclear energy. Europe was and still is a leader in nuclear technology. Greece is not a country that has nuclear energy. There is no way that we will reach carbon neutrality without nuclear. Are we investing as Europeans in the next generation of small nuclear reactors? Have we really placed our chips where we should in this green transition, at least identifying three, four critical industries?

Are we investing in our interconnections to the extent that we should? When it’s blowing in the North Sea, it may be sunny in Greece, but there is no way you can make renewables work unless you have a very sophisticated interconnection grid. I think we at least need to get our priorities right and try to be real champions where we can be. Maybe acknowledge the fact that maybe we will never be as competitive as China when it comes to the production of commodities such as photovoltaic panels”.

On the prospect of the return of the Parthenon Sculptures and EU-UK relations after the 4 July elections, the Prime Minister noted:

Daniel Franklin: As looks likely, we have a new government under Sir Keir Starmer in Britain. What do you think the prospects are for the return of the Parthenon Marbles to Greece?

Kyriakos Mitsotakis: Well, things can only get better, can’t they? But first of all, before touching upon the issue of the Parthenon Sculptures, let me say that a lot of us felt very sad and distressed when the UK took the decision to leave the European Union, in spite of the fact that the relationship was not always very smooth.

My first Council meeting, European Council meeting, was the last meeting that the UK Prime Minister participated. That’s when Boris told us, “see you later”, and then we all know what happened since. Of course, also a lesson into the false promises of populists and the fact that now, if you look at the polls, if the referendum would take place now, were to take place now, it would have been a different result.

Now, I don’t expect the UK to rejoin the European Union anytime soon, but I do expect the next Prime Minister, if the polls are correct, to re-engage more actively with Europe and to come to some arrangement that will at least partially reintegrate the United Kingdom into the European market with the price that this, of course, entails. But I do think that the benefits for both sides will be more than significant.

I would certainly like to reach out to the new UK Prime Minister, if that’s how things will work out, and to build a more constructive relationship. Then, of course, this could also have positive consequences for what has been, I think, a Greek mission for many, many years. What is important is to first ensure that the British government will not stand in the way of a possible arrangement that can be found between the Greek government and the British Museum. And if it can encourage it, so much the better.