Francine Lacqua: Prime Minister, thank you so much for joining us. President Trump has called President Zelenskyy a “dictator”. What’s your reaction when you hear that?
Kyriakos Mitsotakis: Well, Francine, thanks for having me. President Trump is a very smart man, and he has his own unique way of expressing himself. But I think that in principle, I think we need to agree on certain fundamentals. I’m sure that these statements that I will make also reflect the view of our American friends, that we need peace through strength, that obviously there can be no solution for Ukraine without the Ukrainians being involved. Of course, there can be no security arrangement for Europe without the Europeans also being involved.
So I think we are at a relatively delicate state when it comes to these discussions. Of course, Europe also needs to come up and emerge with a unified voice. We need also to do what is expected from us in order to commit to our own security, not just Ukraine’s security.
Francine Lacqua: Prime Minister, what can Europe do concretely? Can they move without the US, or is it talking with the US? What are the steps that you see going forward?
Kyriakos Mitsotakis: Well, Francine, I’ve always been a strong advocate of Europe doing more to take control of its own security priorities. As you know, and as you pointed out, Greece is a country that is spending more than 3% of our GDP on defence, and we have been consistently exceeding the 2% threshold, at a time when richer European countries were not contributing to our common defence budget in the way that they should.
This is really the time when we need to move from words to actions. We need to spend more on defence. We need more fiscal flexibility when it comes to the European rules to allow us to spend more on defence, without breaching European expenditure rules. This is something which has been acknowledged by the President of the Commission. I’ve been lobbying very hard to get to that point.
Of course, I think we also need some joint European borrowing facility that will allow us to implement projects of European common interests, such as a European missile shield, which would benefit the entire continent.
Again, we’ve been talking a lot about these priorities over the past years. I think now we’re faced with what I would call a “rude awakening”, in a sense, and we need to move from words to action.
When President Trump, many years ago, pointed out that we didn’t spend enough on defence, he was in principle right, and we need to make sure that we make up for the lost ground.
Francine Lacqua: But Prime Minister, in terms of timeline, when will Europe accept the need for joint bonds? Again, are those conversations accelerating at pace? Will it become a reality soon?
Kyriakos Mitsotakis: What I expect will become a reality as soon as the next European Council is the first intervention which I talked about: we need more fiscal flexibility. When we spend more on defence, the incremental spending should not count towards our European deficit calculations. This is a decision that we could make theoretically as early as the European Council in March.
Frankly, we cannot delay this decision any longer because should we choose to spend more, and again, I do need to point out that Greece has been spending significantly more than our European allies, we need the necessary fiscal flexibility in order to be able to do that.
I could expect a decision regarding the fiscal flexibility, what we call the exemption from the activation of the general escape clause, to come as early as March. I think talking to many of my European colleagues who could be classified as “frugals”, they also recognise that in extraordinary times, we need to take extraordinary measures.
So the discussion about some joint European borrowing facility is certainly on the table, and I also expect it to pick up steam very quickly.
Francine Lacqua: I think Bloomberg Economics estimates that around 3.1 trillion dollars over the next 10 years. Can Europe find that money, come up with that money?
Kyriakos Mitsotakis: I don’t think that the money can come up exclusively from national budgets. As I told you, we need a combination of national financing and European financing. We know that we have significant capability shortcomings in air defence, in military transport. These are gaps that we need to fill. But again, I do want to be very, very clear; this change cannot take place from one moment to the next.
Hence, in spite of whatever tension may have arisen, I remain a strong proponent of the value of the transatlantic partnership. Yes, sometimes our American friends may express themselves in a different way, but when they point the finger at us and tell us, “you need to do more for your own security”, again, in principle, they are right. I’ve been making the same argument for quite some time now.
Francine Lacqua: Prime Minister, who will speak for the Europeans if Europe actually gets a seat at the table with Donald Trump and Vladimir Putin?
Kyriakos Mitsotakis: That is a decision we still have to make. One of the topics that we could discuss is to appoint a very high-level EU representative who could speak on behalf of the European Union. Because right now, as you know, we have the President of the European Council, we have the President of the Commission, we have the High Representative. But we may choose to actually appoint a special representative who needs to be someone with a lot of authority and gravitas who could represent the European Union. I think it is necessary to speak with one voice.
Francine Lacqua: It does seem that Vladimir Putin managed to achieve what they wanted, which is speaking to the US directly, superpower to superpower. What can the EU now do to get a seat at the table for Brussels, but also Kyiv?
Kyriakos Mitsotakis: Well, first of all, when we talk about security arrangements in Europe, obviously, Europe will have to be involved. One of the discussions that are taking place is related to future security guarantees to Ukraine. I think many expect that Europe will have a role to play when it comes to defining these security guarantees. That’s why I spoke about the need to discuss the new European security architecture, obviously with the involvement of Europe.
But again, the more committed, Francine, we are to addressing chronic shortcomings of the European Union, the more credibility we will have in playing an active role in these negotiations. That’s why I do expect, and I’m calling for very concrete results which should be reflected in the conclusions of the next European Council. We don’t have a minute to waste.
Francine Lacqua: Prime Minister, Donald Trump also announced new tariffs on auto imports as soon as April. Is the EU considering or should it consider to actually lower its own tariff rate to avoid some of the American duties?
Kyriakos Mitsotakis: As you know, tariffs and trade is an exclusive competence of the European Commission. We don’t want to get into a trade war with the United States, but should it be necessary, of course, Europe is going to respond. I think we still have time to avoid that. I think it would be bad for both our economies, both the European economy and the American economy.
I’ve always been advocating that if there are unilateral gestures that Europe can make to level the playing field, it should proceed with doing so sooner rather than later. But again, we should have no doubt that in case Europe is put in a position where tariffs are imposed unilaterally on European goods, Europe will be forced to respond. But I’m cautiously optimistic that we will be able to avoid this scenario.
Francine Lacqua: Does it have to adhere to WTO rules, or do you think Europe should try and get a unilateral deal with the US directly?
Kyriakos Mitsotakis: To be honest, I think this is going to be a discussion that will take place between Europe and the US directly. I think we all see the value of making sure that we have a level playing field. Again, if there are unilateral gestures that Europe can make to level the playing field in goods where maybe we have higher tariffs than our American friends right now, we should have the courage to do so.
Francine Lacqua: Prime Minister, I also want to ask you something domestically about the Santorini earthquakes that, of course, are decreasing in number, but the outlook is quite uncertain. What impact would that have on the tourism season?
Kyriakos Mitsotakis: I noticed you had the Prime Minister of Iceland before me on the show, so he seems to be quite concerned with countries that are geologically active. Yes, we’ve had a lot of medium-size earthquake activity taking place on Santorini. We’ve seen a reduction of the activity over the past days, which is encouraging. Of course, we always listen to the scientists, and we have to prepare for all eventualities. But Greece is a safe country, and this is a message I wanted to communicate. No one can predict the future, but we’re cautiously optimistic about what is happening in Santorini, and if things go, hopefully, according to plan, we’ll return to a normal state relatively soon.
Francine Lacqua: Prime Minister, thank you so much for giving us a bit of your busy schedule today.
