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The implementation of the ambitious “Project Helios” for the mass use of solar energy provides an opportunity to reduce Greek debt by up to 30 billion Euros if the fixed disincentives for investment are overcome, if funding and the initially agreed schedules are met. 

The issue was discussed yesterday during a meeting between the Minister of Environment George Papakonstantinou and the German Vice Chancellor and Minister of Economy and Technology Philipp Rösler, which took place during the Greek-German business forum organized by the Federation of Greek Industrialists (FGI) and under the auspices of the Ministry of Development. 

“Project Helios” envisages the construction of photovoltaic facilities with a total capacity of 10GW, covering a total area of ​​200,000 hectares of state land, which will be leased long term from the Greek state with all necessary licenses being secured. The investment will require up to 20 billion Euros. 

In the joint management venture the country’s share will reach 30 percent and that of the investor will be 70 percent. If the state decided not to rent the land but to give it in concession, where the photovoltaic parks will be built, then its share may reach 50 percent. 

The investment that provides for electricity production from renewable sources, has secured favourable treatment by the Community regulations for the next 25 years. During this period, however, the return of the initial investment could reach 100 billion Euros. 

The securitization of part of the revenue for the state during this period may provide a percentage in the range of 20-30 billion Euros, which can be used to reduce the debt. 

The final clauses of the contract will be formulated soon, by the end of 2011, with the signing of the Memorandum of understanding (MOU) with Germany, and finalization of definitive agreements with the EU. 

Upon presentation of  “Project Helios” on the sidelines of the Congress of the Environment Minister George Papakonstantinou stated that its advantages to the Greek-German business forum in comparison with similar investments in Germany, stressing that Greece has 50 percent more sunny days and therefore greater return on investment. 

The project envisages the production of electricity for export. And this is where problems begin. The Environment Minister admitted that the network of the National Electric Company (DEH) allows transfer of up to 2 GW, which prevents the transmission of additional power from “Helios”. Therefore, in addition to the infrastructure with parks, new investments and the strengthening of distribution networks will also be required. 

After his meeting with Philipp Rösler, the Greek Minister said he has submitted to his interlocutor the investment opportunities that exist in the areas falling under the jurisdiction of the Ministry of Environment. 

Regarding privatization, he pointed out the reduction of the share of all state-owned energy companies. Philipp Rösler in turn said that there are opportunities for exporting solar energy to Germany. 

Rösler - Chrisohoidis 

Rösler and the Development Minister Michalis Chrisohoidis discussed many solutions to the lack of funding for major infrastructure projects as well as for small and medium enterprises. 

The Vice Chancellor of Germany clearly said yesterday that from the German side there will be official support regarding the issue of financing. He stressed that a major German investment bank, KFW financial institution, which helped restore the German economy after World War II, will also finance German investments in Greece. 

Simultaneously, he undertook to provide know-how, and potential experts in establishing the investment bank, planned by the Ministry of Development. 

Minister Chrisohoidis pointed out that in the coming weeks a decision is expected which will allow Greece to establish a fund with a capital of the restructuring programs of the National Strategic Reference Framework, which will fund major infrastructure projects. 

The German Vice-Chancellor, in turn, stressed that regarding the positive outcome on the issues of Greece related to the implementation of NSRF, he himself had already had meetings with the competent bodies and commissioners. 

Philipp Rösler: Major reforms must be implemented

However, the German economy minister did not fail to note the need to accelerate structural change and complete the institutional framework for investment. He also pointed out that Germany is not only making investments in energy, infrastructure, technology and informatics, but also provides know-how and support to enhance the overall competitiveness of the Greek economy. 

Mr. Rösler expressed his admiration for the efforts of the Greek nation during this difficult time and said he felt calm about the next public reactions. 

However, he avoided commenting on the capacity of the government to complete the change of the financial assistance programme for Greece.

Chances 

Not only the fast track initiative, but also the comparative advantages of Greece were analyzed by Aris Singros, Executive Director of the Invest in Greece Organization, during the business forum, attended by nearly 70 German businessmen, most of whom are active in the renewable energy sources sector. 

He pointed out that three large infrastructure projects are ready (one also relates to photovoltaic devices) which are included in the initiative, and their implementation is expected soon. 

The response of Daskalopoulos 

In his speech at the forum, the chairman of the Federation of Greek Industrialists (FGI), Dimitris Daskalopoulos expressed his belief that the business circles of both sides could find a wide scope for joint investment activity by mutual financial interest. 

For his part, Deputy Chairman of FGI Thanassis Lavidas stressed in his address that the message they want to pass on to the German investment community is that most Greek companies have maintained a strong structure and have taken the necessary reordering purposes. 

Reticence of banks 

The director of the German financial powerhouse KFW, Lutz Christian Funke reported of the creation of a special plan "Greece" for the financing of the German investments in Greece. 

Mr. Funke said that despite the increased risk for financing in Greece, his bank had decided to support the initiative. As he pointed out, depending on the amount of funding, this would be effected either directly - if large, or through a Greek commercial bank, with a credit line. 

The Director of the Association of German Banks, Michael Kemer, noted that one of the greatest risks in investing in Greece is the risk assessment of a long-term loan. 

The Head of the German organization for external loans and investments, Matthias Keller, stressed that his organization cannot provide guarantees for Greece for more than two years. 

Memorandum 

The visit of Philipp Rösler in Greece ended with the signing of a Memorandum of Cooperation between the German Vice Chancellor and the Greek Development Minister Michalis Chrisohoidis. 

The main points of the memorandum stress that the two ministers: 

1. Welcome the intention of German firms to invest in Greece, and to enter into business cooperations with Greek companies. 

2. Agreed to continue discussions and negotiations between Greek and German companies. 

3. Will follow with great interest the development of investment ventures of companies and will help them as far as they can. 

4. Welcome the interest and intention of the German companies to participate in projects for the privatization of Greek enterprises and in the use of state property. 

5. Will try to solve problems related to the arrears of the Greek State to German companies.

6. Will boost their economic and political cooperation. 

7.  Both organizations for the development and support of investments “Invest in Greece” and “Germany Trade and Invest” will strengthen their cooperation in exchanging experiences and information. 

8. Are committed to support SMEs in Greece. 

9. Will approve of the German investment bank KFW, providing know-how to the Greek government in order to create such a Greek investment bank for development. 

10. Are providing significant financial support for German companies, with the new funding instrument "Greece", within the framework of the KFW bank, “Lending to companies". 

With the advancement of reforms Greece will emerge stronger from the crisis 

The events and climate in Europe as well as the situation in Greece and the pace of the economy were the focus of conversations that took place yesterday in Athens between the Prime Minister George Papandreou and German Vice Chancellor Philipp Rösler. 

According to reports after talking about reforms and the changes taking place, the Greek prime minister underlined to his interlocutors that Greece has many advantages and that investments in Greece are "investments in the Greece of the future." 

In turn, Mr. Rösler focused on Germany´s efforts to implement investments in Greece and expand opportunities for their funding, expressing the view that Greece will emerge stronger from the crisis. 

During the meeting which took place "in a very good atmosphere", Mr. Papandreou also noted the efforts being made, the "victimization and maturity of the Greek people", and the German Vice-Chancellor expressed his respect also to the whole of Europe for those efforts. 

With Antonis Samaras

"Intentions for German investments in Greece should be viewed by all of us as a very important event," said New Democracy leader Antonis Samaras yesterday after his meeting with the German Vice-Chancellor on the sidelines of the Greek-German business forum. 

Also, regarding the contract from July 21, he said: "As you remember in the decision from July 21, the devil lies in details. But neither the liquidity of the Greek economy, nor the future of our social security funds are a mere detail. I hope this government, which does not negotiate on any issue, is at least hearing us." 

Fight for strengthening of Euro 

At his meeting with Finance Minister Evangelos Venizelos, Mr. Rösler requested the repayment of the Greek State to the German companies, which are active in Greece, by confirming Germany’s support for Greece. 

Rösler said that Germany is ready to fight for the strengthening of the Euro and the Member States of the eurozone. 

Statements by Evangelos Venizelos 

"Mr. Rösler sees Greece as a member of the eurozone and the message we send is a message of stability and prospects for our single currency and for our common home, which are the eurozone and the European Union" said, in turn, the Greek Finance Minister. 

The German Vice-Chancellor also expressed his satisfaction at the assurances of Venizelos that the outstanding issues with the German companies will soon be resolved. 

"Greece is experiencing a very difficult and critical moment. The crisis also presents a chance. This is a chance to increase our competitiveness through difficult but necessary structural changes. The decisions we make are decisions that help in the long term, help Greek citizens and it is extremely important to understand this, not only in Greece but also internationally," added Evangelos Venizelos, expressing satisfaction with the intentions of Germany to invest in energy, tourism, information and high technology.