The government encourages foreign capital investment and protects foreign investors against compulsory appropriation of their assets in Greece. Incentives include reduced tax rates and increased depreciation rates.
Total direct foreign investment (FDI) was estimated at $3.78 billion in 1995. From 1995 to 1997, FDI inflow averaged about $1 billion a year. In the wake of the Russian financial crisis of 1998, FDI inflow fell to $700 million in 1998 and to $567 million in 1999. FDI inflow in 2000 reached over $1 billion and grew to a record $1.56 billion in 2001. In 2002, FDI inflow fell nearly 90% to $50.3 million. For the period 1999 to 2002, FDI inflow averaged about $833 million. Total FDI stock in 2002 was over three times the 1995 level, totaling $12.5 billion.
Outward FDI flow was $542 million in 1999, over $2 billion in 2000, and $611 million in 2001. Outward FDI increased to $655.3 million in 2002. For the period 1999 to 2002, average outward FDI from Greece was $993.3 billion. The total stock of outward FDI held by Greek investors was $5.86 billion in 2002.