Bloomberg Audio Studios, podcasts, radio news. We have Kariako schmits attackers, Prime Minister of Greece here with us. We've jumped straight in a lot of movement on Ukraine this week. You've had Trump saying stuff about it. You have various NATO allies getting cross about the fighter jets and curtaining in their territory and warning Russia about it. You even had Germany coming forward and saying, let's use the one hundred
and forty billion dollar billion euro frozen assets to help Ukraine. Now, you have always been a kind of champion of this idea of having a common European fund for defense, and you've always had pushback from the Germans on that. Do you think now it stands the chance of going through?
Well, thanks for having me, John.
I've been advocating for quite some time about the need to create some joint European borring facility to cover what I consider the quintessential European public good, which is common Youseuropean defense. And I do sense that there is much more momentum now amongst my colleagues. Some of the countries that were inherently against the idea of additional further joint borrowing have changed their mind, and I'm pretty sure that
Germany will eventually also agree to this necessity. And we need to make sure that this facility finances projects of common interest. And I would put missile defense, drone defense right up there in terms of our collective European priorities. So I would expect some movement soon. We have two European councils and hopefully we can make progress towards that direction.
Just looking at the economy at the moment, the Greek economy has been doing very well, is no doubt you will tell me. But in twenty twenty four you forecast a deficit and then you ended up with a surplus, and this year you're again forecasting a deficit. It's quite close to the end of the year. I wondered if now you're close enough to say this year you end up with a surplus again.
For the more we've been having, we've been producing significant primary surpluses, and I think it's quite possible that we may have a real surplace again this year. This is a foundation of our economic policy. We've suffered a lot from not being fiscally disciplined. This is not going to happen again. But I think the big success of our policy is to ensure that the economy is growing at
the same time to create jobs. We've created five hundred thousand jobs since I became Prime Minister, and the real goal is to ensure that this collective wealth is spread equally. So my focus now is to use whatever physical space I can create through growth and tackling tax evasion to cut taxes to the middle class. It's important for me that this discussion is not just limited to the economists
saying good things about the economy. I want the average Greek to really feel a tangible benefit from this girl story. And starting January first, when these tax cuts will kick in, they will see a real increase in their paychecks.
And this is very, very important to me.
It's kind of like the average Greek in a second, you just mentioned fiscal discipline. I mean, you look at the core of Europe. I sat down with Premiss Sanchez to Spain the other day as well. Something dramatic has changed. You know, Greece Spain, You're the country is growing really fast. In the middle You've got countries in much greater trouble. You look at France, you're growing clapping out over two percent. They're struggling to get to half a percent of growth.
That death is ballooning, is it? We now in a situation where you would worry about financial contagion from France.
This seemed inconceivable a few years ago. What I can tell you is that eventually no one can beat the markets.
We know this.
Very well, and I do think that at some point governments have to take difficult decision to put their fiscal house in order. We've done that. Once you do it, then you can enter into this virtures cycle where you can actually grow the economy, you can cut taxes, you can support income through targeted measures. We're there, but we also went through very very difficult periods and very painful reforms. So I do hope that the political situation in France
somehow stabilizes. It is important that the core of Europe, you know, France, German, that these economies are doing well. Look at I mean, we we will receive thirty six million tourists this year. Our tourism industry is booming. But if our core markets don't do well, we will also at some point indirectly be affected.
You're famously polite man, and I know that Sheldon Freuder is not a Greek word as a German one, but there must be some element in Greece of looking at these people who nearly push Greece out and thinking, well things have changed.
Well, things have changed.
But at the end of the day, this is not about you know, pointing fingers, or about saying that you were wrong and we were right. It's about ensuring that Europe collectively grows. I'm disappointed by the fact that when I look at the drug report, we have not made significant progress, and I think it's time that you know, you know, in Europe, we were usually were too.
Of the council.
We were our European hat and we were our national hat. And it seems to me that for some countries the European hat seems to be shrinking. So we have to look at the big picture. Some of the decisions that we need to take require more funding. It's pretty clear, and we need to put our European interest, not necessarily ahead of our national interest, but to realize that some difficult decisions need to be taken at the European level.
One of the areas where Europe has been pretty useless at doing these things is banking, the banking union and things like that. At least Unique Credits has built up a stake in Alpha Bank, which you were famously much more relaxed about than the Germans were they when they built up one in Commerce Bank. Would you be prepared if they were to take over Alpha Bank?
Would you be relaxed about that?
If we really mean what we say about creating skill in banking union, we should be open to these types of transactions. I see value when an important foreign bank wants to acquire a stake in a Greek bank, it means they believe in the potential of the Greek economy, and it means that the bank could possibly do better. I'm pushing my banks to extend more credit to mortgages, to small medium sized enterprises. The stronger their balance sheet is,
the more likely it is that they will do so. Yes, in principle, we are in favor of these transactions, and I'm happy that Unit Credit has decided to look at one of our Greek banks and take a significant stake.
Isn't that But as you said earlier, that's the kind of problem with Europe at the moment. Most people are taking these decisions on I suppose purely nationalist or that kind of level. You look around Europe at the moment, the ability to create common things like a banking union, that's the real problem at the moment. Do you think that is something coming from Brussels or from the national capital.
I think most of the important if you want to understand what's happening in Brussels, look at the national capitals.
I think.
The Council has become more complicated in terms of taking decisions. But on the other hand, past we took a momentum decision when we had to address COVID is Ukraine, a geopolitical COVID moment. I would argue to a certain extent, yes, and I remember the COVID fund negotiations. There are a lot of countries, including Germany, they said no until they
said yes. So when it comes to defense, which as I said, is the ultimate European public good, I do expect that we will be able to take important decisions to target specific European projects, which would then again require European collaboration.
You talked a bit earlier about the average Greek I was looking at the numbers. Greek GDP has come soaring back, but still roughly the same level in nominal terms as it was before the crisis, a bit lower in real terms. Is that still Greece has now been through that phase and it's now the terms of looking forward to a different form of Greece.
We have clearly turned the page. But as I said, if we want to converge with Europe, we need to grow faster than Europe. We've been doing this, but this growth needs to be qualitatively different. We needs to focus on investment, on innovation, on experts, on creating really valuable jobs. And my main goal is to ensure that way wages increase, that we have wage convergence with Europe, and that we support disposable income at a time when all European economies
are faced with the cost of livid crisis. I mean, and the only way to address this is to ensure that we support disposable income. But we have to do it in a fiscally sustainable way. That's what we have done so far. We will continue doing it. I do expect that next year we will again perform very well. So I tell my fellow Greek citizens that I think the best days are ahead of us, and that this is a policy that will deliver long term benefits to them.
You have elections coming up in twenty twenty seven. The polls at the moment, so you might have to go into coalition with people you've won two terms. I think you'll be the first person and to get a third term. If you did, would you be prepared to go into coalition?
Elections are eighteen months ahead. Eighteen months out. We are way ahead in the polls. Our goal is to win an absolute majority. We've done it twice. There were people doubting that we would succeed before the previous elections.
I think that if we deliver on.
Our commitments, and if the economy continues growing, if we work hard to improve the National Health service, these are the priorities I set out in twenty twenty three. We have a reasonable chance to win an absolute majority. But if the quick people decide otherwise, it's eventually we have to respect their decision.
We will look forward to following you through that. Carre chrismis te guess. Thank you very much for talking to Bloomberg.
Thank you, thank you John for having me