Greece Might Finally Sell The Acropolis

After months of denials, Greek Prime Minister George Papaconstantinou admitted the country may be forced to sell the Acropolis, something that many consider to be unthinkable.  But the unfathomable may be possible.

Though the wonder of the Ancient World may not be sold, lesser-known state assets may have to be as Greece looks to dig itself out of its financial hole. Up until now,  the premier did not want to face voter ire if possible. It is enough that citizens will suffer the results of austerity that cut some of their salaries and raised their taxes.

The promise that the government would hold on to public assets was always at risk. The Greek economy continues to shrink. Credit ratings agencies and capital markets investors have begun to signal that the southern European nation may default on its obligations in 2013 when the principle on some of its paper comes due. The EU and IMF bailout of Greece will cost about $150 billion over three years. That will apparently not be enough to offset the damage of a stagnant economy.

So far the Greeks have only taken half measures with their real estate. According to Bloomberg, the government has tried to lease the land to developers rather than to sell it outright. Greece could change the terms of those leases eventually as any sovereign nation can.

The attempt to raise tens of billions of dollar through offers which are less  ambitious than selling land and other Greek assets has been met with a lackluster response. IMF and EU officials must be watching that. They want their money back and a default by Greece would make it nearly impossible. It would also tempt investors to believe that default is an option for other EU nations if it is an option for Greece.

The Greek government may not have agreed to sell some of its prized land assets yet, but the pressure to do so has become relentless. Almost no one believes that the nation can cut its deficit much through higher tax receipts and lower spending.

Douglas A. McIntyre