LOCATION AND SIZE.
Greece is located on the southernmost point of the Balkan Peninsula and is flanked by 3 large bodies of water: the Aegean Sea, the Ionian Sea, and the Mediterranean Sea. Greece is bordered to the north by Albania, the Former Yugoslav Republic of Macedonia (F.Y.R.O.M.), and Bulgaria. To the northeast and east is Turkey. The Hellenic Republic of Greece is rich with history, tradition, and archeological sites dating back thousands of years to classical ancient Greece.
With an area of 131,940 square kilometers (50,942 square miles) and a coastline of 13,676 kilometers (8,498 miles), Greece is a land of mountains and sea. Greece's mainland, the Peloponnesus Peninsula, is connected to the Isthmus of Corinth. The country also has more than 2,000 islands, of which 170 are inhabited. Greece is approximately the same size as the state of Alabama. Its cosmopolitan capital, Athens, is located on the Peloponnesus Peninsula.
Greece's position in the Aegean Sea and its access to the Turkish Straits has made it a country with a rich nautical tradition and a valued member of the North Atlantic Treaty Organization (NATO: a military alliance of certain European states, Canada, and the United States).
The July 2000 population of Greece was estimated at 10,601,527. The birth rate was 9.82 births per 1,000 people while the death rate was 9.64 deaths per 1,000 people. The annual population growth rate was estimated at 0.21 percent.
Nearly all of the population is of Greek descent (98 percent) with the remainder belonging to other ethnicities. However, the Greek government has claimed there are no ethnic divisions in Greece. The majority of Greek citizens are between the ages of 15 to 64 years (67 percent) with 15 percent of the population under 15 years of age and 18 percent 65 years and over.
About 98 percent of Greeks are Orthodox Christians, a religion that figures prominently in Greece's culture. Small religious minorities do exist in Greece. Muslims comprise 1.3 percent of the population and the remaining 0.7 percent includes Catholics, Jews, Old Calendar Orthodox, Jehovah's Witnesses, Mormons, Protestants, and other faiths. Most Muslims live in Thrace, and they are Greece's only officially recognized minority after receiving legal status through provisions in the Treaty of Lausanne of 1923.
The official language of Greece is Greek, which is spoken by 99 percent of the population. The Greek language has its basis in classical Greek and the language of the 21st century is quite similar to that which was spoken during the 5th century B.C.
Athens has a population of 3,096,775 and is a bustling urban center. Athens' suburban population stands at 748,110. Urbanization has been an important trend in the 20th and 21st centuries, yet more than one-third of Greek society is classified as rural. Many people moved into the cities following World War II, lured by a thriving economy that offered a better standard of living than existed in the countryside. Athens is known for its cosmopolitan lifestyle and for retaining many characteristics of village life such as the importance of family, family businesses, and the popular Greek coffeehouses.
Manufacturing accounts for about 14 percent of the GDP. In 2000 the manufacturing sector increased modestly. During the 1990s, the most important and profitable sectors have been (in order) foodstuffs, textiles, chemicals, and nonmetallic minerals.
The economic crisis of the 1970s and 1980s, in which the Greek economy experienced declines in its GDP growth rate, rising labor and oil costs, and high inflation, hurt many manufacturing companies. The government bought many of these companies to prevent them from going out of business and help them earn a profit. Eventually, the PASOK government in the 1990s decided to embark on a continuing privatization policy in an effort to encourage foreign investment.
Prior to Greece's admittance into the EU, the government tried to bolster new manufacturing companies with tax breaks, tariff protection, and cheap loans. However, this policy was eliminated to comply with EU regulations. Today, most government assistance to manufacturing firms takes place in the form of grants and subsidies for new investment.
Foreign investment in manufacturing has not been strong, despite incentives from the Greek government as early as 1953, but it has grown since 2000. Investment by foreign companies is important, as it helps a struggling economy grow. It expands an economic sector, brings new technology into a country, increases tourism, creates new job opportunities, and accelerates growth in other sectors of the economy. Greece's EU membership helped lure some investors with the promise of working in a unified European market. In 1992, a large Italian company, Calcestruzzi, bought a substantial share of Greece's major cement company, AGET. By 1988, an estimated 18 percent of total manufacturing employment was under foreign control.
The mining industry is small but significant because of Greece's vast mineral resources. Lignite, which is used for making energy in Greece, and bauxite, the raw material needed for aluminum production, are 2 minerals that are found abundantly in Greece. Other mineral deposits include ferronickel ores, magnesite, mixed sulfurous ores, ferrochrome ores, kaolin, asbestos, and marble. Mining accounts for only 1% of the GDP. Mining of metallic ores is concentrated in the hands of a few private companies. Quarry production is divided among many small companies. In 2000 mining output rose significantly, in contrast to its negative performance of the previous 2 years.
Housing and building construction have always played a key role in Greece's industrial sector and have long been a major source of income. Today, construction activity accounts for approximately 7.5 percent of the GDP and is expected to rise due to new infrastructure projects financed by EU funds.
The government traditionally has seen the construction sector as a way to boost employment, income, and domestic demand. Accordingly, the housing construction industry has historically enjoyed tax advantages. However, with the fiscally conservative policies of the 1990s, increased taxation was considered.
The construction of large public works has also played a significant role in this subsector of the economy. The new international airport in Athens was a major construction project planned by the government. The first passenger flights took off in March 2001 and the government hopes the airport will become a regional hub for routes to Europe, Africa, and Asia. With its state-ofthe-art facilities, the new airport is expected to boost the tourism sector and handle the tourist traffic demands of the 2004 Olympic Games, which will be held in Athens. The $1 billion construction project involved both Greek and foreign private companies and the Greek public sector. Attiki Odos, a conglomerate of Greek construction companies, constructed a high-speed toll roadway, and plans are underway to build new hotels near the airport.
The Athens Metro subway system is another construction project that is being renovated and expanded in 2000-01, as well as new roadways, railroads, and bridges. Under the terms of the EU, Greece must be open to international bidding for major projects, which provides tough competition for the Greek construction industry.
In 2000, private building activity increased. Permits for new projects, particularly in the housing industry, rose by 6.3 percent and many predict a real-estate boom in coming years. Although the residential housing market has matured, expansion seems likely in the area of home renovations and in the purchase of second homes.
The service industry is the most important sector of the Greek economy. In 1998, the service sector provided 64.4 percent of Greece's GDP, and accounted for nearly 60 percent of Greece's labor force . A variety of businesses are included in this sector: street vendors, the hotel and lodging industry, telecommunications, and public administration.
Greece has long been known for its warm climate, scenic Mediterranean coastlines, and classical archeological and historical sites. These attractions, together with its beautiful and quiet islands, delicious culinary offerings, and renowned hospitality have made Greece a popular tourist destination. The most popular attractions are the Acropolis of Athens, the palace of Knossos on the island of Crete, the temple of Apollo at Delphi, the Epidaurus Theater and the palace and treasure of Mycenae in the Peleponnesus, and the Acropolis of Lindos on the island of Rhodes.
The tourism industry has grown significantly since the 1960s, and is a major source of foreign exchange, but this sector has suffered from poor infrastructure and a strong drachma. European tourists visiting Greece tripled from the early 1970s to the late 1980s, and reached 11.5 million visitors in 2000. Most tourists visiting Greece hail from Great Britain and Germany; however, droves of visitors come from Italy, the former Yugoslavia, France, and the Netherlands. The number of American tourists declined during the 1990s. Lodging options have increased significantly between the 1970s and 1990s due to an expansion of hotels. In 1998, tourist revenues were high as Greece benefited from problems in neighboring countries and an economic recovery in the EU. Today Greece faces tough competition from Turkey, which has become a popular vacation destination, but improvement in the tourism sector does hold promise.
Fully understanding its importance, the government is working to improve this vital sector of the Greek economy. First, it is attempting to upgrade facilities in the country to levels found in competitors Spain and Italy. It is also looking to expand the tourist season from 6 months to year-round through sports, hosting international conferences, and cultural tourism. Developing marine tourism with activities such as cruises and sailing excursions is another priority. To accommodate more tourists, the state-controlled Hellenic Tourist Organization is planning to expand the number of marinas (docks for pleasure boats) operating in Greece.
In 2001 the PASOK government of Prime Minister Simitis launched a campaign to attract private investment in Greece's tourist industry as part of its ongoing privatization program. The Hellenic Tourist Properties (ETA), which is the asset management arm of the Hellenic Tourist Organization, is trying to attract private investors to develop its properties through long-term leases, joint operations, or equity operations. Some of the projects in need of investment are a theme park for Anavissos, an aquarium, and camping grounds at Voula. The city of Rhodes will build more hotels, a golf course, and athletic facilities. The government hopes these new attractions increase Greece's popularity as a tourist destination, especially with the approach of the 2004 Olympic Games, which will bring thousands of new visitors to Greece. The government is trying to ensure they will return as tourists.
Greece's rugged interior, its lengthy coastline, and multitude of islands have made shipping an important industry. Greece's 5 major cities—Athens, Thessaloniki, Patras, Heraklion, and Volos—are all major ports, and there are a total of 123 ports throughout the country, which are essential to transporting and importing goods to and from Europe, the Balkans, and the Middle East.
Shipping has been one of Greece's most important and profitable industries due to the business know-how of its shipowners. Its merchant fleet is one of the largest in the world totaling 3,358 ships in 1998, although many of its ships are older. However, Greek ship owners are trying to upgrade their fleets with new ships, and there were a record number of new ship-building orders placed in 2000, due to low prices offered by South Korean shipyards. Many of Greece's ships are cargo carriers to third-world countries, so the industry is sensitive to downturns in the world economy.
Road transportation saw increases in the second half of the 20th century, gaining in importance compared to rail and shipping transport. However, the closing of roads in the former Yugoslavia, traditionally Greece's route into Europe, caused sea transport to increase in importance once again.
Olympic Airways, which is partially state-owned, is Greece's exclusive airline. Olympic offers domestic flights throughout Greece's major cities and islands, as well as overseas flights to Europe, the Middle East, the United States, Japan, Singapore, Thailand, and South Africa. While passenger loads have increased, the airline has faced financial difficulty as a result of high costs. Greece has negotiated plans with the EU to restructure the airline.
Railway construction began in Greece in the 1880s and, given the rugged terrain of the country, was an extraordinary feat of engineering. Tracks cover slightly less than 2,548 kilometers (1,583 miles) of the country. The EU is providing assistance in renovating the railroad system. Since 1990, diesel locomotives have gone into service and shortened travel time.
In 2000, new registrations for automobiles increased, although many buyers have apparently postponed new purchases until Greece joins the economic and monetary union and interest rates fall to euro zone levels. Truck roads are inadequate in comparison to European standards. Greece has one of the worst automobile accident levels in Europe.
Public transportation in Athens is made up of an overcrowded and unreliable bus network and Metro subway system. Renovation and service extension of the Athens Metro finally began in 1993 after many delays. Work on the 130 year-old Athens Metro was finished in January 2000. The project faced many obstacles because of poor soil conditions, the presence of archeological remains, and contractor disputes. The Metro is expected to have a huge impact on daily life in Athens and ease passenger traffic congestion, making commuting much easier. Attiko Metro, a state-controlled company, oversaw the design, construction, and operation of the new Metro lines and U.S.-based Bechtel International acted as project manager. Further expansions are planned, particularly into lower-income neighborhoods in Athens as required in the funding package from the EU's Community Structural Fund, which provided much of the financing.
Greece has no territories or colonies.
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Drachma (Dr). 1 drachma equals 100 lepta. Coins in circulation are 1, 2, 5, 10, 20, 50 and 100 drachmae. Paper currency includes denominations of 100, 200, 500, 1,000, 5,000, and 10,000 drachmae. As a member of the European Union, Greece adopted the new currency, the euro, for non-cash transactions beginning in 2001, and will adopt the euro for cash transactions beginning in January 2002. The drachma will be replaced by the euro on February 28, 2002.
Manufactured goods, foodstuffs and beverages, fuels.
Manufactured goods, foodstuffs, fuels, chemicals.
GROSS DOMESTIC PRODUCT:
$149.2 billion (1999 est.).
BALANCE OF TRADE:
Exports: US$12.4 billion (1998 est.). Imports: US$27.7 billion (1998 est.).