Prime Minister Kyriakos Mitsotakis participated in a discussion with the President of the European Council António Costa, in the context of the Delphi Economic Forum. The discussion was moderated by CNN Senior International Correspondent Frederik Pleitgen. The Prime Minister’s remarks follow:
In his opening remarks, referring to the war in Iran and its economic impact on Greece and Europe, the Prime Minister noted:
I think we are faced with potentially a crisis of very significant proportions. It is a question of time. If the blockade of the Strait of Hormuz continues for a significant amount of time, we will have physical disruptions in the supply of crude oil and products. We will have significant increases in the prices of energy, we will have shortages in fertilisers, and we will most probably have a spike in inflation and a significant reduction in our growth rates.
This will affect all European countries. Greece may be doing better than most European countries these days, but we are not immune to a crisis of this magnitude.
So I would agree with António that the number one priority is to get to a permanent ceasefire that will essentially return us to the status quo before the war, because the Strait of Hormuz was open. We are a leading maritime nation. We cannot accept the notion that an open waterway will be subject to any tolls or any payment.
This is something which would set a catastrophic precedent. So we need to put all our efforts in supporting a diplomatic solution, but we also need to be ready, and this will be discussed tomorrow, for a possible worst-case scenario.
We saw what happened during the Ukraine war. We saw how dependent we were on Russian gas. And I think that this crisis is also another opportunity to recalibrate our strategy regarding strategic autonomy and our resilience on European energy, because we have placed a lot of emphasis and we’re leaders in decarbonization, but this cannot be the only goal. Security of supply, sustainability of our industry needs to be right up there in terms of our priorities.
We talk a lot about reducing the amount of CO2 we emit. We don’t talk about the availability of jet fuel. I mean, this is a real issue these days, so I would urge us all – and we’ve had these discussions – to be much more pragmatic and to have a Plan B in place in case this crisis is prolonged, because the financial impact is going to be significant, and no member state can support our societies indefinitely without some sort of European support.
When asked about meeting Europe’s energy needs, especially at a time when demand is rising due to the demands of artificial intelligence, Kyriakos Mitsotakis stated:
Well, first of all, let me use the Greek example, which is also quite similar to Portugal as maybe a case study of an energy mix that actually works for Greek consumers.
We took a decision seven years ago to move away from coal almost completely -primarily for environmental but also for cost reasons, because coal is becoming very expensive when you add the CO2 emission costs- and move towards an energy mix where we rely on renewables and natural gas as baseload power.
We’re now one of the leading countries in terms of electricity production from renewables. You saw quite a few windmills on your way to Delphi. So the combination of wind, solar, and hydro allows us now to have significantly lower prices than many of our neighbours and to turn Greece from a net importer of electricity into a net exporter of electricity.
Of course, in order to export more -and to import more when we need it- we need more grids. This is a challenge. The truth is, and I’ve been very blunt on this topic, that the European energy market is completely fragmented. We do not have a unified energy market in Europe. The countries that are producing cheap energy don’t necessarily want to share it with others, and we need to overcome this blockage.
But at the same time, what António said is incredibly important. If we’re going to import natural gas, and we will need to do so, let’s make sure we do it from reliable partners. In Greece, we have placed a bet in turning Greece into an entry point for liquefied natural gas, primarily from the US, and to use what we call the “Vertical Corridor” to supply countries to our north and to be also a provider of energy security. And my last point, we need to go big on nuclear, and I’m saying this without…
(The moderator’s comment on whether energy policy in Europe has been influenced by ideological considerations in the past)
We’ve seen this at the Council. We lost years discussing the famous taxonomy question, and it was a moral discussion. “We don’t like nuclear, because it’s bad. We don’t like natural gas, because it’s almost as bad as nuclear”, although we all recognise it’s much better than coal.
But look at Germany now. It shut down its nuclear industry, lost the know-how, and is burning coal, and it will burn coal at least until 2036. It’s wrong from an environmental point of view. It’s wrong from a CO2 point of view. From an economic point of view, it doesn’t make any sense.
So I think when you look at the clean tech industry in Europe where we can still be competitive, we need to double down on those industries where we can actually create homegrown strategic autonomy. And we need to do it in nuclear.
And I’m speaking as a country that has no nuclear production, and it will take us a lot of time to discuss whether we will become a nuclear country. But when I wear my European hat, I fully recognise that we need to leave these ideological debates behind us.
We need to be ruthlessly pragmatic, and we need to understand that nuclear will be part of the solution, and we’d better grow our own technology rather than import it again from the US or from Korea or from any other country that has nuclear know-how.
When asked about Europe’s role in the U.S.-Iran negotiations, the Prime Minister stated:
Well, let me first of all point out that our first priority was to ensure that we protect the territorial integrity of all our member states, and what happened in Cyprus was, I think, a litmus test for many member states.
Essentially, we, for the first time, experimented with operationalizing Article 42, paragraph 7 of the European treaties, which is our mutual assistance collective clause. And many European countries -we were first for geographic and historical reasons- supported Cyprus by making a military deployment, and what we want to do now, and this is certainly going to be a Greek priority, is to say, okay, if this were to happen again, how could we do it better, because this will be a clear indication that we take our strategic autonomy seriously.
Second, we are building – and I think we’ve done a lot of work also under the leadership of António – strategic partnerships with the Gulf countries. We’ve done so bilaterally. We have strategic partnerships with these countries. We supported them in times of great difficulty because we consider the Gulf countries to be very important in terms of our regional footprint as a European Union.
But in terms of the negotiations themselves, although we share some of the goals of what happened, I mean, this was not Europe’s war. So at the end of the day, the parties responsible for negotiating the end to the war need to be the parties that are actively involved.
So we have to be realistic in terms of what we can and what we cannot do, but we’re also ready to support and to participate in any initiative where we can add some real value.
And again, on the question of navigation, for Greece, this was a priority at the Security Council. I chaired the Security Council months ago, and my topic was the freedom of navigation. I could not imagine at the time that this would be so relevant these days, but making sure that we have an active role to play when it comes to this issue, especially as Europe being -not just because of Greece, because of other countries- a global superpower when it comes to navigation. That’s, for example, a topic where we could play a role.
If there ever were to be a need for a multinational force to patrol a ceasefire, if this were necessary, we would be happy to do it. We did it in the Red Sea. Greece was leading operation “Aspides” to protect maritime transport from Houthi attacks.
If I want to be honest, am I happy with the overall participation of European countries? No, we could do more. And that’s why we’re also encouraging our European countries, if you want to take strategic autonomy seriously, this is not just about the leadership of the Union, it’s member states that commit the resources. If you can have ten member states, for example, sending ships, it’s different than having three.
So a lot of it also falls on our responsibilities. If we really want to be at the table, we also have to walk the walk. We have to be present and demonstrate to all the actors in the region that we have value to add.
Referring more specifically to areas where Europe can take the initiative, Kyriakos Mitsotakis said:
I just want to say that, again, this is a very complex situation. And of course, there’s the conflict itself, but there are other areas where we can and we should be more involved.
Lebanon. We need to support, and we’ve done so. We just, for example, sent another plane with humanitarian aid, and many other European countries have done so. We need to be very active in Lebanon. If we can be active in brokering a permanent peace between Lebanon and Israel, this will be to the benefit of the region.
Gaza and the reconstruction of Gaza with – this is the position of Greece, but also of the European Union – the endpoint being a two-state solution.
The protection of Christians in the broader region and in Syria in particular, where we have quite a few reports of Christians being persecuted.
So, there are areas where we can be active. We have both the connections and the know-how to be possibly more effective. And we do this in cooperation with our US allies, because in spite of everything that’s being said and in spite of whatever turbulence and bumps there may be down the road, I remain a believer in the transatlantic partnership.
If you look at the strategic challenges from the East, we need to find a way to work together more effectively.
When asked what steps the EU should take to increase its influence in the Middle East, the Prime Minister noted:
And we can do it by being – we have to be – practical, as much as I like these fascinating discussions.
Lebanon needs humanitarian aid and the Lebanese army needs equipment. Okay, so who can step up? It’s just we have to be very practical. We’ve done so, many other European countries have done so, but if we believe that we can be a geopolitical player by just making nice statements from Brussels, this is not going to take us very far.
In Egypt, for example, and I was a big proponent of highlighting how important Egypt is for Europe, we’ve made significant steps. We put money on the table. We manage the migration problem together. The same is true in Libya. We have a vital interest in stabilising Libya and in ensuring that it’s not subject to other foreign interference. We’ve done so. We are there, we’re present, we try to support their coast guard.
So this is about, I would say, hard realpolitik. And we may not be where we want to be, but we are making progress – we have a Commissioner now for the Mediterranean. And again, you should not forget that the European Union is a very unique creature. It’s still, you have the Commission and then you have 27 member states, and inevitably what will happen is that you will have more initiatives which can be labelled coalition of the willing, because…
(Remarks by the moderator regarding whether such partnerships will continue to be formed)
I think it’s happening already. I mean let me come back to operation “Aspides”. Some countries will contribute, some countries will not contribute, and I think it’s normal. Some countries may have a greater interest in doing so.
In the case of Ukraine, which was an existential threat, we managed to come up with a European solution. I think we need to be proud of the fact that we stuck together, because this was an existential threat for Europe as a whole.
It would be great if we could get similar responses to other crises, but if that is not an option, then we need to find more ad hoc type solutions. The countries that are more willing, more eager or have a greater interest, simply because they may be in the region, to contribute materially to these types of initiatives.
In response to a question about European support for Ukraine and the issue of defense spending, Kyriakos Mitsotakis noted:
Well, we’re happy that we’re resolving the loan problem to Ukraine, hopefully. And we’ve delivered, we stepped up to the plate financially and militarily. I mean, Greece has been supportive of Ukraine, in spite of the fact that this policy was not always very popular in Greece due to historical and cultural ties to Russia. But I was very clear in trying to explain to our people that we are a country that will always uphold international law and that the violation of borders through the use of force can never be accepted.
And if you look at our geography and our threats, I think you understand why this is a position of principle that needs to be defended at all costs. So we will continue to do what we have to do in Ukraine, and I’m sure that eventually the US will also do the same thing, to reach a point where we can have a negotiated solution that will not be from a position of weakness when it comes to Ukraine.
But I would like to very much support what António said. We have two main priorities in Europe, and these are the topics that really preoccupy us at the European Council.
Our competitiveness, we’re falling behind, and that’s why I’ve been calling for a pragmatic strategy that will balance our climate targets, our ambitious climate targets, with the need to protect our competitiveness and foster social cohesion.
And of course, supporting our defence industry and increase our defence spending. Remember, we had discussions years ago about having more fiscal space in terms of the European rules to spend more on defence. We did it. And that’s why we can afford to do that. But we need to spend more on defence, but also build our own industry.
For example, in Greece, we spend more than 3% on defence. And of course, we partner with the US, we partner with Europe, but we need to develop our homegrown defence industry. And at a time when the shape of war is changing, we cannot rely on expensive interceptors to shoot down $20,000 drones.
And there is so much dynamism in Europe. I’ve seen amazing companies in Portugal, for example. We need to bring all these startups together. We need to change our procurement method and thinking in our ministries of defence. When we talk to our generals, they still think big ships, big platforms, big planes, expensive. And I said, okay, but…
Regarding cooperation with Ukraine in the field of drone production, the Prime Minister said:
We’re looking into it, and I think it’s only fair. I mean, we’ve supported Ukraine, and I think it’s only fair that Ukraine would share some of its technology -and it is cutting-edge technology- with us and with European partners that are willing to invest. It’s not easy. And again, one of the reasons why it’s not easy is because the mindset has been different.
So, for example, we set up a special nimble authority within our Ministry of Defence that does only innovative things, that puts out RFPs, asks our startups to come up with products, tests them in real case scenarios. We have an anti-drone system that we put on our frigates that shot down drones, Houthi drones in the Red Sea. We developed it, our own. I mean, it works. We’ll commercialise it and if we can, sell it to other countries.
(Remarks by the coordinator regarding the acceleration of procurement procedures in the current conjuncture)
It has to be a dual-purpose track. On the one hand, we need big platforms and we need to be able to cooperate.
I’ve been following with concern – we discussed it at the European Council – the fact that Germany and France cannot agree on a joint 6th generation fighter. I mean, sorry, but we cannot afford in Europe to have two different planes. We can’t. And I’m glad that they gave themselves more time. We need to find a solution, egos need to be put aside because this is always a problem. And we need to understand that when it comes to at least some of the really big systems, we cannot afford to have a procurement that’s broken down along national lines.
We need to change our merger rules. We need more scale. So on the one hand, you need more scale for the big players. Can we create an Airbus today with our competition rules? I doubt it, but Airbus has been a stunning success, probably the most successful example of European cooperation of a competitive product that has taken over the whole world.
We need to do this for some of the big platforms and at the same time give space to this amazing ecosystem of startups and come up with nimble solutions that we can commercialise and be aware that the landscape is changing all the time. And what may be relevant today, maybe in six months may not be relevant.
Regarding transatlantic relations and the Trump administration’s stance toward Europe, Kyriakos Mitsotakis noted:
I do believe that eventually we have more to gain by strengthening our trade ties with the United States. And of course, we have established now a balance, but at the end of the day, we all need to be concerned about what’s happening in China. And it’s China right now that is the export powerhouse, that’s flooding the world with very cheap products and that is threatening our industry.
So I would argue that we still have much more in common in terms of thinking as in the context of a transatlantic bloc that will, however, recalibrate the role of Europe. I mean, how can we argue that we can be an important partner, for example, in NATO if we don’t increase our defence spending? We need to step up to the plate in defence and competitiveness, which we discussed. This will inevitably make the relationship with the US more balanced.
But again, I do fundamentally believe that the interests of Europe and the US in terms of what’s happening in the rest of the world will not exclude competition, because there are still areas where we will, of course, always compete, but we are a huge market. The US is a huge market.
Again, I would stress what António said. We are believers in free trade. We think that trade is good. Αnd I’m also speaking representing a maritime nation. 90% of global trade is through ships. And shipping has demonstrated how critical it is for our well-being. So we also have a national interest in free trade because this is a very important industry.
And I think that this relationship can find a new equilibrium, but I’d be happy if this new equilibrium is a result of a Europe that’s stronger and that really delivers in terms of competitiveness αnd in terms of defence, because look, President Trump has his own way of making his points. Was he right when he said that Europe was not spending enough on defence? Absolutely. He was right. Did he push us to spend more? He did, in his own way. Ukraine, of course, also contributed. So the relationship is going to be more balanced. NATO is going to be more balanced if we spend more. And if we develop more European projects, this is not a competition to NATO. This is good for NATO eventually.
So European strategic autonomy, if we deliver more results, if we streamline our procurement… for example, I’ll be welcoming President Macron to Athens in a couple of days. We’re signing the extension of our strategic partnerships. I’ll give you a practical example. We bought the same ships with the French. Exactly. This is good. This is interoperability. We contributed also. We want to be a bigger part of the production process.
But this was essentially SAFE before SAFE. In 2021, we said we’re going to build the same ships more or less. And of course, we’re going to pay the same price with the French. So these are the sort of initiatives that we need, and inevitably if this happens, it will result in a more balanced relationship with the US.
Regarding rare earths, critical materials, gas supplies, and hydrocarbon drilling in Greece, he stated:
Βut we also need to understand and take a sectoral approach and look at industries where we can still afford to be competitive -and there are quite a few of those- and industries where China has an insurmountable advantage, or it probably doesn’t make sense to invest that much.
But when it comes to your question regarding natural gas, the real question is, do we want to recreate dependencies on actors who have proven to be completely unreliable? I mean, you mentioned the German story. Of course, Germany was very reliant on very cheap natural gas, and look how this turned out.
So I don’t think there’s an appetite in Europe right now, frankly, even if the war were to, and hopefully, we hope for the war to be resolved, to recreate these energy dependencies with Russia. Plus, I thought that the US was very eager to sell us natural gas. There are other suppliers.
And of course, we are also in Greece looking for our own natural gas. We will have a first well that’s going to be drilled in Greece in more than 40 years, but with cooperation with Exxon and Greek companies.
So let’s not forget that at some point we also have rare earths and critical materials. And again, in the spirit of not being so sort of ideological, we need to balance the protection of the environment with the need to access critical components. Some of them may be present in Europe that we will eventually need. And certainly if Greece were to discover natural gas, it would be good for Greece, obviously. It would also be good for Europe.
