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Tsipras builds bridges with business

Syriza leader promises Greek industry lower energy costs, streamlining of bureaucracy, and more favourable business conditions

Burnishing his statesmanlike image, Tsipras promises Greek businesses tax breaks and reforms that can bolster healthy enterprise and leave back the parasitic, state-funded business model of the past

Alexis Tsipras is fashioning the image of a business-friendly statesman Alexis Tsipras is fashioning the image of a business-friendly statesman Of all the political courtships and engagements stirred by this weeks' electoral results, none is more significant than Wednesday's efforts at rapprochement between the victorious main opposition Syriza and Greek big business.

Gradually settling in to the new reality of leading the country's top party, Syriza leader Alexis Tsipras essentially asked Greek industrialists for a new social contract, in which business would heed the basic demands of labour, such as restoring the minimum wage to the pre-crisis level of 750 euros monthly and re-implementing restrictions on mass lay-offs.

A carrot for business

To that end, Tsipras' message to the Hellenic Federation of Enterprises (SEV) extended an olive branch and a big carrot to Greek industry, as he essentially offered government measures to reduce the high energy costs of industry – possibly with tax breaks – in return for big business making key concessions in the field of labour relations.

Insisting that the government no longer has the political and moral legitimisation to continue to rule – he said the electorate voted for the government to leave, and not to go ahead with a cabinet reshuffle - Tsipras tried to outline a viable framework of government-business-labour relations that could be put into effect under a Syriza government.

The Samaras-Venizelos coalition government has argued that a Syriza victory would bring economic catastrophe.

In response, Tsipras is maintaining that the austerity and internal devaluation policies of the government – which are on the surface business friendly, as they have vastly lowered labour costs – have in fact contributed significantly to the deep business slump and the destruction of the real economy.

Statesmanlike image

As in the final days of the campaign, Tsipras depicted his party as ready and able to implement a comprehensive economic recovery plan that can unite Greeks behind a national reconstruction effort.

While offering pledges that all Greek governments have in the past 40 years - such as streamlining the bureaucracy, cutting down red tape, instituting a stable and transparent tax system, and combating rampant tax evasion - Tsipras is also trying to convince big businesses that he feels their pain as well, and chiefly in the area of skyrocketing energy costs, which Greek enterprises blame as the top cause for the flight of otherwise profitable businesses from the country.

Tsipras stressed that energy costs in Greece have risen an astounding 60 percent in the last five years and insisted that government has a key role in reversing the upward spiral in energy costs.

That includes energy tax breaks for business as well.

"It is the responsibility of the government to reduce energy costs, and this can only happen with a political decision on the costs, as regards the 70% of that cost that is not controlled by DEI, the public power corporation.," he said, promising electricity price reductions to the poorest classes.

But he also advocated lower taxes for business. "The necessary support for business is the duty of the state, not of DEI," he proclaimed.

But that argument was accompanied by a main platform call for the state to regain control of DEH, a proposal which runs counter to current EU policy.

Handouts to big business?

Syriza spokesman Panos Skourletis dismissed the idea that energy tax breaks will be a handout to big business, arguing instead that it is a necessary condition for jump-starting the real economy.

"Labour costs have fallen greatly and energy is the main cost that makes Greek production expensive. It is a joke to speak of an outward looking economy, and businesses with a focus on exports that can compete in the EU framework, with such high energy costs," Skourletis said, advocating state control over the main electricity company.

"Can this [state intervention in energy prices] be done with a privatised DEI? I say no. But it can be done with a DEI under public control, which can implement social policies for the weaker segments of the population, but also can implement a more favourable pricing policy toward businesses that truly produce," Skourletis said.

In a sense, Tsipras is back where Antonis Samaras was as opposition leader when he was denouncing the bailout memorandums and promising a sea change in economic policy.

He offers a detailed diagnosis of the sweeping economic destruction caused by austerity, and a series of measures to correct it, but it is far from certain if Greece's creditors will allow him to implement any of that, if and when he comes to power.

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Politics
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Public Power Corporation (DEI)
Alexis Tsipras
Hellenic Federation of Enterprises (SEV)