Nelson's Column
Charlie Nelson's Blog
Save the world by saving Greece
Charlie Nelson
February 2012
The world owes Greece a big debt. Now that Greece is in trouble it is time to repay some of that debt.
Democracy evolved in Greece and many fields of knowledge, including science, flourished in ancient Greece. Greece has provided us with a rich trove of legends and literature. Australia has welcomed many immigrants from Greece and they have enriched our culture and especially our cuisine.
But now Greece is in economic trouble. While the Greek economy is quite small on a global scale, their troubles affect the world economy, threatening contagion to larger European economies.
Greece’s sovereign debt is very high at 140% of GDP in 2010. GDP shrunk in 2011 by 5%. The interest rate on the debt is high because of the risk of default. One prescription is to cut government outlays in the form of public servant salaries and pensions in order to reduce the debt. But that would send the economy into an even deeper downward spiral. Another prescription is government stimulus to grow the economy – but where would the money for that come from?
The only way out is for Greece to grow its economy via a massive export boom which creates jobs and grows tax revenue to repay debt. The exports would include wine and especially tourism.
Each country should look at how they can help – for example, Britain should return the Elgin Marbles and so encourage growth in tourists to see them in their original location.
Greece makes good wine and olive oil. Australians like both wine and olive oil and we could hold a festival of Greek wine and olive oil. There are some very fine wines and one of the liquor chains could easily run the wine component of the festival. I have a nice bottle of Greek olive oil – 776 B.C. from the “ancient groves of Greece” – and this suggests their unique benefit.
Many a country would say we have our own problems to solve without worrying about Greece – but the woes of Greece are infecting the global economy.
We owe it to ourselves, as well as Greece, to save Greece in this way. There is no other way.
It would be a challenge for marketing to translate such good will into an export boom that could turn minus 5% GDP growth into plus 5% GDP growth for a few years. I hope that the profession will rise to the occasion.