Turning Northern Greece into an Industrial Champion
The debt crisis in Greece and the adjustment of goverment spending have led to unexpected deep recession with GDP and employment fall by 15-20% with respect to 2010 levels. Against this background (and the 3rd MOU of 80 billion Euro loan), the report “Turning Northern Greece into an Industrial Champion” by Ansgar Belke, Nicos Christodoulakis, and Daniel Gros, compare the successfully overcome structural change in the Ruhrgebiet regions with the current situation in Northern Greece, especially Central Macedonia and the city of Thessaloniki, and point out lessons to be learnt from the Ruhrgebiet when conducting the required structural reforms and coping with structural change.
The report analyses the structural characteristics of the Greek economy and workforce with particular emphasis on the northern regions in Greece and compares them to the Ruhrgebiet and NRW. The key findings are first of all that there are some similarities in the problems (of the Ruhrgebiet in the 1970s and Northern Greece today), such as the low level of qualifications of the workforce, but there are also notable differences, in particular the importance of industry and manufacturing, whose weight in the local economy was excessive in the Ruhrgebiet, but appears rather low in Greece.
Moreover, it appears that Greece seems to have made great progress in tertiary education, at least in quantitative terms. The proportion of the workforce with a university degree is now about the same in Germany and Greece. In this sense Greece has been quicker than the Ruhrgebiet. But the results in terms of productivity and innovation are very different. It remains to be seen whether is this due to the quality of the university education or the fact that the universities in Greece constitute ‘cathedrals in the desert’ because there is no high-value added manufacturing base around them to make use of the graduates. This absence of a local manufacturing base in turn could be due to the fact that the middle level in terms of educational qualifications is much thinner in Greece (and in particular in the north of the country) where the proportion of the workforce without complete upper secondary education is still very large.
The report concludes with a series of recommendations that should shape a new growth agenda, such as greater jurisdiction enhanced administrative competences and fiscal autonomy for cities and regions of N. Greece; targeted policies of vocational training and life-long learning, enhanced manufacturing infrastructure, large-scale energy production base on lignate, international collaboration and support in exports, financial engineering, and transfer of technological knowhow.
Full report: Northern Greece_Ruhr-Mercator-Industrial Champion