Thessaloniki offers glimmer of hope for Greek reform

Thessaloniki offers glimmer of hope for Greek reform
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Over the last six years of turmoil in Greece a discourse has concentrated on the essentially corrupt nature of the Greek state and the near impossibility of reform. Since 2010, Thessaloniki and its mayor Yiannis Boutaris have shown that Greek politicians can make tough decisions, reform government and balance the books.

Greece has suffered years of tumult with Eurozone bailouts, mounting debt and numerous elections, including this year’s referendum. Outsiders have variously shown the country either sympathy or opprobrium and many fingers have been pointed at who is to blame for the prolonged crisis.

The discourse, however, has focused on the near impossibility that Greece seems capable of reform and in particular, clean, effective governance. The northern city of Thessaloniki, the country’s second largest, is demonstrating that this assumption is false.

In 2010 incumbent Vasilis Papageorgopoulos, of the New Democracy party, stood for re-election as Thessaloniki’s mayor and surprisingly lost to outsider and independent Yiannis Boutaris. The new mayor – a local wine magnate – has set about reforming the municipal civil service, increasing tourism and improving the investment climate.

The staggering corruption of the previous regime – potentially a precedent for other administrations in the country – was exposed and Papageorgopoulos was convicted for the embezzlement of €17.9 million and sentenced to life imprisonment, later reduced to 20 years and then released this year on health grounds.

Boutaris’s main task has been to streamline the civil service, with such basic steps as defining job descriptions and reducing the number of departments in the city’s bureaucracy.

Despite the austerity imposed on Athens, Boutaris has balanced a budget that previously ran a significant deficit and even turned this into a surplus. The mayor considers himself a pro-business social democrat – he has reduced the local corporate tax rate while his progressive agenda has included support for a gay pride parade in the city.

The city has much going for it, including a large port and four universities. While Thessaloniki has never been Greece’s most visited destination, the region has a fascinating history as well as world class beaches in near-by Halkidiki.

In the recent past the city was part of the Ottoman Empire while its majority group of inhabitants were Sephardic Jews until the Second World War. As a result Boutaris has aimed to attract tourists and budget airlines, to rebuild links with Turkey, as well as Israel, and increase flights to Thessaloniki’s airport. Around 100,000 Turkish visitors now visit the city each year, many to see the renovated birthplace of their country’s founder, Kemal Ataturk.

Despite his re-election in 2014, Boutaris has made some opponents, including local trade unions over his attempts to privatize waste collection. He has also received much admiration from unusual quarters for a Greek politician.

The European Commission has called Boutaris a ‘beacon’ and a ‘model for all Greece’, and has been nominated for World Mayor of the Year. Boutaris has improved the look of the city, including a new pedestrianised waterfront funded by the EU. In particular, German newspaper Die Zeit has written that Boutaris’s Thessaloniki represents the ‘other Greece’ in a long interview full of praise for the mayor.

Municipalities, however, only have limited clout in highly-centralised Greece. For instance, Boutaris bemoans the lack of influence he has on the city’s crucial Port Authority. Faraway Athens makes the key decisions on this and as a result, Boutaris, who derides Syriza as ‘idiots,’ can only influence investment and use tax revenues to a certain extent.

After a year of turmoil, the September general election that returned Alexis Tsipras to power appears to offer the country a period of greater stability and a commitment to bailout conditions. Yet, the government could stand to look at Thessaloniki and its mayor who has shown that the country can progress along the road to reform.

Categories: Europe, Politics

About Author

Robert Ledger

Robert Ledger is an analyst on European affairs, with a particular focus on the Balkan and Caucasus regions. He has an MA in International Relations from Brunel University and a PhD in political science from Queen Mary University London.