Volume 4, Issue 2

AHI President’s Note: The American Hellenic Institute presents AHI’s Capital Report which is a timely synopsis of recent policy discussions in Washington to help keep you abreast of the latest developments. As a service to our membership and constituency, and to gain an understanding of the position of other entities on our issues, the American Hellenic Institute attends and participates at policy forums or roundtable discussions to ensure the policy positions of the Greek-American community are represented.

The content provided in AHI’s Capital Report is for informational purposes only, and does not necessarily reflect the position or opinion of AHI.

Black Sea Policy Center Examines Evolution of Turkish Policy

On March 5, 2012, AHI attended a discussion presented by the Center for Black Sea/Caspian Studies titled "The Evolution of Turkish Polity and Regional Politics: Time to Reassess?" Professor Mustafa Aydin led the discussion and James Goldgeier, dean, School of International Service, American University, provided opening remarks.

The main theme presented by Professor Aydin focused on the internal evolutionary process of domestic society in Turkey and how it is shaping domestic politics and international policy. These governmental experiments can be seen in recent history as Turkey in the 1980s had an authoritarian-style government but a liberalized economy. Into the 1990s and 2000s, the Turkish model continued to change and eventually experienced an opening of government, he explained. The AKP party has been a main benefactor from these changes and has been able to remain in power for three terms. Early on, the government needed to balance between a plethora of issues which divided its attention and was a check on its power. By the third term, any previously existing rivalry had broken down and with it the checks and balances. This has allowed for a great suction of power inward, allowing for the strengthening of the central government more so than previously.

The internal shifts that have been experienced have also greatly affected foreign policy. Previous Turkish policy left a lot of ill-feeling with neighbors, a trend that Turkey has tried to curb recently, Professor Aydin offered. Turkish foreign policy has also evolved to where it has become more focused on the Middle East. These plans have been based on mediation to seek solutions but Turkey has shown little willingness to become involved in events more difficult to predict. The end result has not led to great foreign policy success. Although policy has shifted, there has also been a shift with the role of Prime Minster Erdogan, he explained. Increasingly, Erdogan has become involved in foreign policy matters, taking a stronger leadership role but also showing his personality as he takes decisions and discussions personally, Professor Aydin concluded.

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Greece’s Post-World War II Economy Recovery Examined

AHI attended a discussion panel at the Woodrow Wilson Center titled, “Occupied Economies: An Economic History of Nazi- Occupied Europe, 1939 – 1945” on April 11, 2012. Speakers included: Sergei Kudryashov, scientific researcher, German Historical Institute in Moscow; and Hein A.M. Klemann, professor of Economic History, Erasmus University, Rotterdam.

Kudryashov discussed his latest book “Occupied Economies: An Economic History of Nazi – Occupied Europe, 1939-1945” which focuses on the problems occupied countries had to solve during World War II, the consequences of Germany’s occupation, and how these countries solved their problems in the postwar era.

Klemann opened his presentation by exploring the available options of working with an occupied country. He concluded that in order to restructure such countries “you have to try to get them working.” Based on his remarks, the decision-making process was not clear with Germany. There was no national planning and there were many conflicts between the Berlin authorities and the local authorities. He cited a specific example in Western Europe and the Czech Protectorate where emphasis was placed on the production for German warfare, which kept these economies functioning. Moreover, he referred to the consequences of the German occupation in these countries. Illegal production was high in the post-war era and labor in raw materials constituted for the best conditions for the increase of the “black market.”

When it came to examining examples from non-Western countries, Klemann stated there was information only about Greece. He mentioned that Greece didn’t recover quickly after its occupation. There was a 50% decline in production, including the black market. In addition during the post-war era Greece had to deal with its domestic issues, including a civil war. France also didn’t recover quickly. In Western Europe, the consequences were not so dramatic, however. He stated, “they missed their normal lives but the consequences didn’t affect dramatically their economies.”
In conclusion, in Eastern European and Balkan countries, a collapse of normal society and dramatic destruction rendered “post-war recovery almost impossible.”

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IMF Head Comments on Greece’s Economic Crisis

The Global Economy and Development Program at the Brookings Institution hosted Managing Director of the International Monetary Fund Christine Lagarde for a conversation on global economic policy priorities amid the IMF-World Bank 2012 Spring Meetings, April 12, 2012. Managing Director Lagarde discussed the state of the global economy and the actions needed by both policymakers around the world and the IMF to keep the recovery on track and create the building blocks for future growth and prosperity.

Strobe Talbott, president of the Brookings Institution, offered introductory remarks. After Lagarde’s address, the program allowed for audience questions. Kemal Derviş, vice president and director of Global Economy and Development moderated.

The Greek economic crisis was also addressed. On a question on whether Mrs. Lagarde sees any positives in Greece and the Greek people, she said the courage of the Greek people in the first place is a very strong positive, and she believes it must be recognized.

“They are very brave and courageous. Greek civil servants, Greek workers, Greek people that face the obligation but pay their taxes…that bear the sacrifice of cut pensions and cut wages,” she said.

Lagarde added that any progress that is made in tax and revenue collection is also a great positive for the country.

“A coalition of the political party to actually endorse, back up, lead in a difficult exercise that the country has to face is also positive,” she said. “And I have to say for having worked with him that Mr. Papademos is clearly on that page, and I applaud his efforts.”

Another question asked how Greece will be able to address its unemployment problem amid the adjustment period provided by the conditionality of the IMF loans. Lagarde replied that all policies have always been held jointly with the European Commission and jointly with the European Central Bank and that is what is called the “troika.” Whenever programs are negotiated, the troika is fully onboard and takes into account what the other members of the currency zone can do. However, institutionally “there is not a way to coalesce members of a currency zone around a particular program that we negotiate with a country, let alone the central bank of that currency zone,” she explained. Lagarde added that the troika should look deeply into that to see whether or not it should be the way in which such sections of a currency zone are being dealt with.

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High-ranking Cypriot Government Official Discusses Upcoming EU Presidency

AHI attended a discussion of Andreas D. Mavroyiannis, deputy minister to the President of Cyprus for European Affairs, held at the Center for Strategic International Studies (CSIS), April 26, 2012. Heather Conley, CSIS Europe program director, moderated.

The discussion focused on the upcoming leadership role of the government of the Republic of Cyprus as it will assume the six-month rotating Presidency of the Council of the European Union on July 1, 2012. Among other topics, Mavroyiannis discussed Cyprus’ agenda and priorities placing focus on the EU 2014-2020 budget. He specifically mentioned efforts to manage the ongoing sovereign debt crisis, the EU enlargement agenda, and relations with neighboring Turkey.

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