Greece’s tourism sector is one of five industries expected to attract foreign direct investment which will in turn boost the Greek economy through to 2025, said Eurobank this week.
According to bank analysts, investments valued at 32 billion euros in infrastructure and real estate, energy and decarbonization, telecommunications and digital upgrades, tourism, and manufacturing are set to drive economic growth in Greece through to 2025. The EU’s recovery and resilience facility (RRF) will finance 24 billion euros of the total through to 2025.
The tourism sector has over the last few years attracted major investments. According to the country’s central bank, Greece has gained ground as an attractive investor destination recording a 74.3 percent increase in foreign direct investments (FDI) in 2021 despite the insecurity and competition in the midst of Covid-19.
Indicatively, co-financed urban regeneration and hotel projects include Ellinikon with a syndicated loan of 1 billion euros, Sani/Ikos with 952 million euros, Andrea Mare (32 million euros), Primonial (48 million euros), Elia Resorts (36 million euros) and Grivalia’s One & Only Aesthesis at the historic Asteria property in Glyfada to open in 2023 (87 million euros).
Additionally, tourism-related infrastructure has also been a magnet for FDI. Indicative infrastructure and real estate projects include Athens International Airport modernization works (1.14 billion euros), Fraport airport projects (960 million euros), Olympia Odos Motorway (738.3 million euros), and projects run by Dimand, including the redevelopment of an abandoned tower in the heart of Piraeus (74 million euros + 112 million euros).
More specifically, according to Eurobank, infrastructure and real estate will account for an estimated 23 percent share of FDI; energy and green transition (29 percent); telecommunications and digital upgrades (12 percent); tourism, hotel units and wellness structures (19 percent); industry and production unit upgrades (17 percent).
“Something new is emerging in the Greek economy with the change of the production model. It is important that the investments we present have a high multiplier effect spreading to small and medium-sized enterprises and across the economy,” said Eurobank CEO Fokion Karavias.
He added that the EU’s RRF resources will be driving the investment dynamic as these remain unaffected by fluctuating interest rates and inflation, forming stable financing conditions until the completion of the projects.
Bank analysts note that financing options will focus mainly on small and medium-sized enterprises. “Today, the Greek banking system finances 150,000 businesses,” said Andreas Athanassopoulos, Deputy CEO and Group Chief Transformation Officer, Digital & Retail Eurobank.
Eurobank has the highest share (33 percent), financing 47,000 companies, he said. “In 2022, we approved 600 million euros in loans to 9,000 businesses. A total of 2 billion euros in loans were disbursed by the domestic banking system in 2022, of which approximately 500 million euros are attributable to Eurobank.”