:00:00. > :00:12.Now on BBC News, stay tuned for HARDtalk.
:00:13. > :00:14.Welcome to HARDtalk. I'm Stephen Sackur.
:00:15. > :00:17.Greece's debt crisis and economic collapse used to be headline news,
:00:18. > :00:22.But does that mean the country is in recovery?
:00:23. > :00:27.Almost half of all young people are jobless and the elderly continue
:00:28. > :00:33.With austerity biting deeper with every new release of European
:00:34. > :00:39.bailout money, is there any way out of the hole Greece is in?
:00:40. > :00:54.My guess is recent's economy minister, Dimitri Papadimitriou. Is
:00:55. > :01:16.there any way out of the hole Greece is in?.
:01:17. > :01:23.Dimitri Papadimitriou, welcome to HARDtalk. Thank you for having me.
:01:24. > :01:28.There you were at the end of last year, enjoying your post as a highly
:01:29. > :01:33.respected academic economist in the United States. You were plucked from
:01:34. > :01:37.back into a senior ministerial job, the economy minister in Athens. Do
:01:38. > :01:43.you regret taking that job, given what has happened in the last six
:01:44. > :01:48.months? Ashley, I don't. I think it is an important challenge. --
:01:49. > :01:52.actually. I cherish the opportunity to serve my country and they think I
:01:53. > :01:58.can do some good. And therefore, over the last seven months that I
:01:59. > :02:03.have been in office, I have tried to find what is the best approach to
:02:04. > :02:10.turn around the economy, along with the help of my colleagues, not only
:02:11. > :02:16.in the Ministry but in the other cabinets. Your colleagues, you put
:02:17. > :02:20.it. I mean, at your boss, let's put it, Alexis C Price, a man who in
:02:21. > :02:30.ideological terms and economic analysis, you share very little --
:02:31. > :02:35.very little. -- Tsipras. There is a lot more then. He is not an
:02:36. > :02:45.economist, he is an engineer. He is a radical socialist. On the other
:02:46. > :02:50.hand, he is a realist. To get the country out of the fix that he is
:02:51. > :02:56.in. I think he has tried to do that, despite a false start, if you like,
:02:57. > :03:05.in 2015. Certain mistakes were made at I think what there is now is
:03:06. > :03:21.reality. It is interesting that you put it like that at the beginnings
:03:22. > :03:25.of his time... Alexis Tsipras represented something new and
:03:26. > :03:33.radical and that he has betrayed his principles because in essence,
:03:34. > :03:37.having come to power and telling the Europeans to go to hell in a
:03:38. > :03:45.position of austerity, he has now bowed his head and is implementing
:03:46. > :03:50.that same austerity. You know the European Union and the eurozone has
:03:51. > :03:56.an architectural problem. Therefore, what was thought in 2015, it was
:03:57. > :04:02.pointed out the difficulties and the problem is that the EU had in
:04:03. > :04:06.dealing with the Greece crisis which was not really a Greece crisis but a
:04:07. > :04:15.European crisis, could have been sold. -- solved. It turns out the EU
:04:16. > :04:22.leaders had no interest whatsoever. At the end, the realisation came
:04:23. > :04:26.that perhaps in order to change the European Union or the eurozone, you
:04:27. > :04:36.needed to start from Greece first. My point is, in essence, Mr Tsipras
:04:37. > :04:40.has betrayed the mandate that he was given in 2015. Let me quote you the
:04:41. > :04:45.words of a Greek economist who says this. " Greek Prime Minister Tsipras
:04:46. > :04:51.didn't change Greece or Europe but they simply changed themselves from
:04:52. > :04:59.an anti- systemic austerity rebels, they have turned into implementers
:05:00. > :05:06.of the new Troika Greek deal, that being the Europeans and the IMF." He
:05:07. > :05:11.says," they denounced it as treacherous deals all the way back
:05:12. > :05:17.to 2010. " He has a point, doesn't he? I would disagree with that. I
:05:18. > :05:25.would say this government has changed a lot in Greece. It has
:05:26. > :05:32.brought it to the situation that one member state needs to be like other
:05:33. > :05:36.member states. I think he has gone through a serious negotiation
:05:37. > :05:40.process and achieved a lot more than the previous governments had the
:05:41. > :05:44.possibility of doing. And he has reached the point where he has
:05:45. > :05:49.created alliances with many of the South European nations that didn't
:05:50. > :05:57.have a chance before to talk and to actually support Greece as we have
:05:58. > :06:01.seen in the last... With respect, Mr Tsipras has simply left a trail of
:06:02. > :06:06.broken promises. Let me quote to you to different things that happened in
:06:07. > :06:13.close conjunction. April 25, 2017, they use it as one of his Cabinet
:06:14. > :06:18.ministers when Tsipras says, "Greece won't implement tax reforms without
:06:19. > :06:25.a debt deal in place". And yet, by May 19, less than a month later,
:06:26. > :06:29.Greek lawmakers, backed by net -- backed by Tsipras, approved tax
:06:30. > :06:35.hikes. That is before the latest deal was done with the EU. Yet
:06:36. > :06:41.another broken promise. In June 15, one has to take a look and see what
:06:42. > :06:45.the agreement was. In April, we didn't know what the agreement would
:06:46. > :06:51.be. We thought in May 15, we would have the agreement we have now. He
:06:52. > :06:56.didn't make any promises that actually did not deliver. What he
:06:57. > :07:04.said was that what ever streamlining would take place, what ever... Let's
:07:05. > :07:10.not use it late -- use words like streamlining, let's just say cuts.
:07:11. > :07:15.However you want to use it, at the end of the day, those statutory
:07:16. > :07:24.forums that they prefer to use, have come with opposite measures that
:07:25. > :07:29.actually leave and an effect. I'm not sure the Greek are going to be
:07:30. > :07:34.convinced what you are saying at all. I'm pretty sure they are not.
:07:35. > :07:37.76% of Greeks in the latest poll disapprove of what Tsipras is doing
:07:38. > :07:44.and it's quite clear that if there was to be an election tomorrow, the
:07:45. > :07:49.party would trout him. People have lost faith in Tsipras because he is
:07:50. > :07:54.not standing what she stood for in the election. The polls give you a
:07:55. > :08:00.false indication. You can use your own country. You know, you thought
:08:01. > :08:04.that in fact the polls showed a major superiority in the Tories and
:08:05. > :08:13.they didn't do very well. The polls, I think, depends how they are being
:08:14. > :08:19.drawn. I wouldn't be so sure that if elections were to be held today the
:08:20. > :08:23.differences would be that much. Let's not just talk polls but let's
:08:24. > :08:29.talk the reality that the Greek space every single day. 22% as
:08:30. > :08:35.national unemployment rate for under 25. The rate is well over 40%,
:08:36. > :08:41.getting close to 50%. The minimum wage slashed by 20% since the crisis
:08:42. > :08:46.began. 43% of Greek pensioners are now living on less than 60 euros per
:08:47. > :08:52.month. Health-care spending down by 40%. I could go on. For the average
:08:53. > :08:57.Greek, life today is intolerable and yet they have just seen in recent
:08:58. > :09:01.weeks Mr Tsipras who is supposed to be that defender of their interests,
:09:02. > :09:03.doing another deal with the bailout powers which means that the
:09:04. > :09:10.austerity they have suffered is going to get even worse. You cannot
:09:11. > :09:16.load everything on this government. The pension cuts began in 2010.
:09:17. > :09:20.There have been many, many more cuts in the pensions. I understand that
:09:21. > :09:26.which is why, the people, believe Tsipras might be the guy to say
:09:27. > :09:34.enough is enough. You know, you are a member of the eurozone and you
:09:35. > :09:41.have to continue as a member of the eurozone because therefore you need
:09:42. > :09:45.to negotiate the best possible solution you can negotiate and I
:09:46. > :09:51.think at the end of the day, if you were to look at what has been
:09:52. > :09:56.negotiated, it's actually a plan at some significant cost, no doubt
:09:57. > :10:02.about that, the pension cuts and tax rates, but the fact is you have to
:10:03. > :10:07.take a look at what it is. You have got a roadmap to fiscal balances,
:10:08. > :10:16.you have an indication that the debt is going to be resolved in a serious
:10:17. > :10:23.way. You can't say that. Where is your evidence? I will come back to
:10:24. > :10:28.it but I will complete it. I can't let you get away with statements
:10:29. > :10:33.that aren't born out of... I'm not afraid to answer your question. What
:10:34. > :10:38.I am suggesting is if you look at the total plan of what is agreed, it
:10:39. > :10:42.provides a lot of opportunities for people to grow, for people to see
:10:43. > :10:46.better days. Where is this roadmap that you talk about to actually
:10:47. > :10:50.tackle the central problem that Greece faces which is that you have
:10:51. > :10:57.a national debt that is over 180% of the GDP and just surfacing about
:10:58. > :11:01.debt drags your economy down every single year. As long as that debt
:11:02. > :11:07.mountain overshadows everything else, it is impossible to see how
:11:08. > :11:12.Greece can recover. I can take a look what's happening this year in
:11:13. > :11:17.2017. It is the year of real growth. The last quarter of 2016, we saw a
:11:18. > :11:23.stabilisation of the economy because there was the row growth. In this
:11:24. > :11:26.quarter, we have seen, all of the indicators show, the health of the
:11:27. > :11:34.economy, to actually be positive. --0 growth. I was in New York for a
:11:35. > :11:40.purpose, I was in Washington for a purpose, I was in London for a
:11:41. > :11:47.purpose. Investing in public as dramatically changed. There has been
:11:48. > :11:51.significant investments taking place in Greece and therefore, Greece is
:11:52. > :11:56.on the road to recovery. Do you think is national community has
:11:57. > :12:00.confidence in Greece? So you saw the international report from 2016 that
:12:01. > :12:05.suggested that still Greece is in the bottom quarter in terms of
:12:06. > :12:11.investment climate compare to all of Europeans? I am giving you what I
:12:12. > :12:17.have observed in the last week in my visit with many investors. That's
:12:18. > :12:20.anecdotal, I'm talking about statistics. I'm looking at
:12:21. > :12:23.individuals who have made investments. There are serious
:12:24. > :12:29.investments that have taken place in Greece. Do your figures compare with
:12:30. > :12:33.other European nations? They are extraordinarily poor. The FDI
:12:34. > :12:40.figures between this quarter, the previous quarter, the previous
:12:41. > :12:44.quarter, and as the growth, that's what I see. That's what an
:12:45. > :12:50.interested in, it will grow faster. This is what I see out here, this is
:12:51. > :13:01.what I read. Therefore, that comes also with actual investments.
:13:02. > :13:03.Phillip Morris, Blackstone, Fortress, these are significant
:13:04. > :13:12.funds that are investing in Greece. You promised me that you would come
:13:13. > :13:15.back to my fundamental question about how Greece deals with the debt
:13:16. > :13:20.mountain which overshadows your economy. You still have not given me
:13:21. > :13:24.the answer. We know the Germans still insist that there can be no
:13:25. > :13:28.long-term debt relief and restructuring until they are
:13:29. > :13:34.convinced that the Greek economy is on a different, better track and
:13:35. > :13:38.right now, the German Finance Minister, and others, are simply not
:13:39. > :13:43.convinced. But the Germans have decided along with everyone else to
:13:44. > :13:48.be part of the growth strategy for Greece. This is why you think -- if
:13:49. > :13:58.you look at what was agreed, they have agreed to support Greece in its
:13:59. > :14:00.growth potential, either by creating the National development bank,
:14:01. > :14:06.providing more European funds and being able to adjust the maturity
:14:07. > :14:11.and the suspension of the interstate payments should the growth of
:14:12. > :14:20.sanctions differ from the actual growth. You have accused Wolfgang
:14:21. > :14:27.Schaueble of being dishonest in the way he blocked debt relief. What I
:14:28. > :14:31.told the reporter, was that Mr Schaueble appeared disingenuous, not
:14:32. > :14:41.dishonest. It's not my fault that the lady was not English-speaking.
:14:42. > :14:45.Whether it was dishonest or disingenuous, neither are very
:14:46. > :14:53.flattering. It is a problem and it is recognised even by his own
:14:54. > :14:59.individuals in the SDP. -- SPD. He is not in the SPD, he is on the CDU.
:15:00. > :15:04.But he has the coalition. It is the CDU which calls the shots. There are
:15:05. > :15:08.other German people and colleagues appears in the year were a group
:15:09. > :15:18.that believes he has had difficulty in understanding that when it was
:15:19. > :15:21.discussed in 2017 that there would be starting serious discussions
:15:22. > :15:28.about the debt, the fact this should take place. Wolfgang Schaeuble, in
:15:29. > :15:33.Malta, April 20 1770s. "I Don't think at all there will be future
:15:34. > :15:37.debt measures from Greece. That is the German position. That was not
:15:38. > :15:43.the position that was agreed last year. Therefore one has to be able
:15:44. > :15:47.to understand whether mixed -- whether Mr Schaeuble speaks for
:15:48. > :15:52.himself or the European Union. When we come back to this question when
:15:53. > :15:58.you in your assignment given to you by the government to go to New York,
:15:59. > :16:02.London, paging, wherever and appeal to the world for foreign direct
:16:03. > :16:07.investment in your country, you have a big problem when the key players
:16:08. > :16:11.in the eurozone, Germans, are still saying that the time is not right to
:16:12. > :16:17.offer Greece long-term debt restructuring. -- Beijing. That is a
:16:18. > :16:23.problem. I see something different when I visit. I see people who have
:16:24. > :16:29.realised there are opportunities in Greece to invest, opportunities to
:16:30. > :16:32.make money because no investor makes investments without those being
:16:33. > :16:38.profitable and that, in fact, there is a Labour force extremely
:16:39. > :16:45.well-trained, university graduates, that can produce the goods and
:16:46. > :16:50.services, high value-added... 450,000 of them have left the
:16:51. > :16:56.country since 2008, graduates, young Greeks. This is exactly what we want
:16:57. > :17:02.to do, we want to keep them. That you have lost 450,000 of them. But
:17:03. > :17:06.listen, when the country goes through a crisis, these are some of
:17:07. > :17:12.the consequences. The question is, what do you do to avert the
:17:13. > :17:16.continuation of this exodus? I think the government has a plan to
:17:17. > :17:20.eliminate that, to stop that. It's a growth strategy which I think is
:17:21. > :17:25.going to be implemented, it being implemented and that is why some of
:17:26. > :17:29.the investors have seen it, they have seen the opportunities. They
:17:30. > :17:33.want to come in and invest. You talk of this group of investors and I
:17:34. > :17:37.have looked across the piece, I don't see many of them, but I do see
:17:38. > :17:43.one country where there is real investment into Greece today and
:17:44. > :17:48.that is China. China has already made significant investments. And
:17:49. > :17:56.the US. But China is striking. At 51% stake in Piraeus port. The
:17:57. > :18:02.redevelopment of the Olympic Park, not sure of that is finalised. It
:18:03. > :18:07.has been not finalised yet. But it is in the offing. A Chinese official
:18:08. > :18:12.says he sees potential in the partnership between China and Greece
:18:13. > :18:16.going to a new level. You entirely happy with the idea that China is
:18:17. > :18:22.buying key assets and has big ambitions in your country? It's not
:18:23. > :18:26.only China, though. I would like to talk about China. I don't know what
:18:27. > :18:32.this means in terms of that new level. I am asking you. I don't know
:18:33. > :18:37.what I would characterise it that way because I see other interests,
:18:38. > :18:47.not only from China but also the US and Aust Rio, from Germany, set the
:18:48. > :18:53.German telecommunication company announced 1.5 billion euros over the
:18:54. > :18:59.next five years. -- Austria. Some to be spent this year. There is no
:19:00. > :19:06.concern... Perhaps the concerns are a bit different with China. June 18,
:19:07. > :19:10.2017, Greece and as a European Union condemnation of China's human rights
:19:11. > :19:18.record at the UN. Senior diplomats told the press it was disgrace. What
:19:19. > :19:22.is Greece up to? That is not a question I know, I can't really
:19:23. > :19:29.answer the question. What I want to say... As a minister, if Greece was
:19:30. > :19:33.exercising that kind of veto on a key human rights expression because
:19:34. > :19:38.of a desire to win Chinese investment, would that concern you?
:19:39. > :19:46.You are drawing that conclusion. Not just me, across Europe. Maybe they
:19:47. > :19:51.have that consideration. It's not only that... What other conceivable
:19:52. > :19:58.consideration for Greece to isolate itself from 27 other EU members on a
:19:59. > :20:01.key expression of disquiet about China's human rights record, what
:20:02. > :20:05.other considerations other than economic? I do not know enough about
:20:06. > :20:10.the Chinese human rights issues. You said they must have been other
:20:11. > :20:14.considerations. You are drawing a conclusion and I am not ready to
:20:15. > :20:17.accept it because I do not know enough about it. I don't know
:20:18. > :20:23.something about it, why would I answer? Why would I agree? You told
:20:24. > :20:28.me there are other considerations. I don't know whether it is only
:20:29. > :20:36.economic considerations. Consider these words, of the former Finance
:20:37. > :20:40.Minister, he said, "Anti- European sentiment in my country is growing.
:20:41. > :20:44.What was once a very friendly country towards Europe is becoming
:20:45. > :20:51.increasingly less so and that is a great danger, a lot of risk." If you
:20:52. > :20:56.believe in this, he had a lot to do with it because he passed a number
:20:57. > :21:00.of legislations and he made some agreements they did not sit well
:21:01. > :21:06.with the Greek people so let's not talk about what the opposition says.
:21:07. > :21:10.Let's talk about what is happening now, what will happen between now
:21:11. > :21:14.and two years and the expectation is in two years, with the 2% growth
:21:15. > :21:18.rate which was agreed by the European Union, even by the IMF and
:21:19. > :21:24.close to 3% next year, I think the picture will be different. Look in
:21:25. > :21:31.2019 and then we can talk about that. But do you least take is point
:21:32. > :21:38.that right now there is a danger that the Greek public are going to
:21:39. > :21:44.be deeply disillusioned with Europe, the European project, the eurozone
:21:45. > :21:49.if things do not improve quickly? I'm not a politician and I do not
:21:50. > :21:55.make forecasts. Only look at the evidence based on I see, whether it
:21:56. > :21:59.is official or anecdotal, I see a different Greece coming. There are
:22:00. > :22:11.better days. I do not care what he says. He should not be proud of what
:22:12. > :22:17.he did. I am interested to see what other people have said about how
:22:18. > :22:22.Greece has performed. They carry some weight. Mr Venizelos doesn't.
:22:23. > :22:30.How long do you have to turn the Greek economy around? I have until
:22:31. > :22:32.the next election in 2019. Dimitri Papadimitriou, thank you for being
:22:33. > :22:54.on HARDtalk My pleasure.