Ambassador Pyatt in Conversation with Journalist A. Mangiriadis at EENE 6th Annual Economic Forum

Grand Hyatt Hotel, Athens

Monday, September 30, 2019, 1:30 p.m.

Apostolos Mangiriadis: Mr. Ambassador, welcome. Let’s have a short discussion here at the panel. Now this encounter and this conversation has a great timing because at the end of the week, we’re expecting the head of the American Diplomacy here into Athens. Mr. Mike Pompeo will be here on Friday. On Saturday and Sunday, he’ll have meetings with the Prime Minister, the head of the Greek Diplomacy, Mr. Dendias, and Mr. Panagiotopoulos. He might see Mr. Tsipras, I don’t know, you are probably preparing his visit. And that prompts me to the first question: We all know that he will be signing the Mutual Defense Cooperation Agreement with the Greek government, and the question here is, In what ways is that agreement upgrading and expanding Greece’s strategic importance, and what are the real benefits for Greece through that deal? Is there a will on the American side to help Greece increase its capabilities in terms of equipment as well? Is there anything specific on that that you wanted to share today?

 Ambassador Pyatt: Well, first of all, thank you, Apostolis. I want to thank EENE (Hellenic Association of Entrepreneurs), Vassilis for inviting me back. This is a tradition now. I think it’s the third one of these that we’ve done, and I think the great advantage of doing this over a number of years is you get a sense of how much has changed. And I think what I would emphasize for the United States is, first of all, our sense that we really have now begun a new era. And you can see that in the messages around the Prime Minister’s very successful visit to New York. I see the Minister here, and I think he has a sense of the very positive appetite from American investors, from the American business community. The United States has made a strategic investment in our relationship with Greece, and we see now an opportunity to take a relationship that was very strong under the previous government and raise it to a new level. You asked about the Defense Cooperation Agreement, and that conversation, of course, will be a very important part of Secretary Pompeo’s agenda when he arrives here on Friday. But even more than that, I think, is the bigger strategic idea: that we look to Greece as a pillar of stability in a very complicated and sometimes unstable neighborhood that stretches from the Eastern Mediterranean, all of the challenges that emerge from the Middle East, from Asia Minor, from the Balkans, from the Black Sea. We also believe that the economic agenda that the Prime Minister is pursuing is of strategic importance to the United States. Because this is a country that has been through a severe economic crisis over the past decade. But looking forward, the more successful the Prime Minister is in his agenda of growing the Greek economy, the better Greece is able to perform that role as a pillar of stability, whether it’s the cooperation that we’re engaged in on strategic energy policy or the military cooperation which our NATO forces are engaged with every day. So this is a very exciting time. Secretary Pompeo will be here Friday, Saturday, Sunday, and then on Monday, we will have the second round of the U.S.-Greece Strategic Dialogue, which brings together all of the different pillars of the work we do together: the defense issues you talked about, our investment in economic cooperation, our energy cooperation, our people-to-people ties, our law enforcement and counterterrorism cooperation. And I think that’s one of the things that really distinguishes the relationship today. We cooperate as partners, as allies, as countries that share interests, and as countries that share values. As I said, I’ve been doing this three years in a row now; I’ve never been as bullish about the U.S.-Greece relationship as I am today. There’s also a clear signal from the U.S. administration, and you heard that when Secretary of Commerce Ross was here. The time to invest in Greece is now. That’s why our Secretary of Commerce hosted a group of investors, one of several investor roundtables that were part of the Prime Minister’s program last week. So with all that as a background, just to answer very briefly your question about the Defense Cooperation Agreement. We’re not in a relationship which is about “You give me X, and I give you Y.” It’s about how we advance our shared interests. And that’s apparent in the work we’re doing together on energy issues, it’s apparent in the way we work together on investment, and I think it’s also part of our defense relationship. We’re doing more today with Greece than ever before in the defense area, but that is progress that began under the Syriza government. And now with Prime Minister Mitsotakis, we see an opportunity, as I said, to raise it up to an even higher level.

 Mangiriadis: Thank you. Let me turn the discussion a little bit to the developments on the Southeastern Mediterranean. Two years ago, in an interview with Skai TV, we all remember your sound bite, “I’m afraid of an accident in the Aegean Sea because of so many different airplanes crossing the air space and again and again with Turkey.” I wonder what about possible accidents in the area where Turkey is clearly violating international law by sending its vessels in the Cypriot Exclusive Economic Zone.

 Ambassador Pyatt: So let me say three things on this. First of all, Greece and the United States share a very similar perspective on Turkey. We both recognize that it’s an important relationship for our respective national security interests, and as difficult as it is, we have to do the work of maintaining that dialogue. We both believe that it’s strongly in our interests that Turkey remains anchored in the West, part of our Euro-Atlantic community, and looking to the West for the future. On the question of the Eastern Mediterranean, the United States has spoken very clearly about our view on the illegal nature of Turkey’s drilling activities in the waters off of Cyrus and our hope that Turkey will avoid these kinds of destabilizing, provocative actions. But I think it’s also very important, and we were very encouraged by the meeting that took place between Prime Minister Mitsotakis and Erdogan last week in New York and the very clear message from the Greek government that Greece is focused on the economy. It’s focused on growth. It’s focused on maintaining a stable neighborhood which provides an attractive setting for foreign investors. And the way you maintain that is by avoiding missed signals to keep the dialogue going. And that’s a dialogue where Greece will enjoy the strong support of the United States.

 Mangiriadis: I sense that you avoided the question of whether you are afraid or not of an incident, but I might get the opportunity to ask you back. We have the migration issue which is, you know, on the nightly news, it’s the number one issue right now. And I wonder how much you see Turkey using that as a tool to obtain gains from the EU or from the bilateral relation with the UN.

 Ambassador Pyatt: So I, of course, remember what it was like in 2015 and 2016 when you had many and thousands of people arriving every day in Piraeus and then moving onward to the rest of Europe. I think it’s important to remember that this is not where we are today. We’re in a different situation. I think everybody shares an interest in seeing the enforcement of the EU-Turkey agreement in all its dimensions. I had a good conversation on Friday with my friend George Koumoutsakos, the Alternate Minister for Migration in the Ministry of Citizens’ Protection. The United States strongly supports Minister Koumoutsakos’ efforts, both to ensure that the EU-Turkey agreement is upheld in all of its dimensions, but also to keep reminding people that this is not a Greece-Turkey problem. This is an EU-Turkey problem, and it needs to be shared by all 27 members of the European Union. I think on your question about the motivation or why is this happening now: I visited the hotspot islands on many occasions. I’m always impressed by the generosity, the decency of the Greek people in dealing with this European problem. I think there are a lot of motivations. I think it’s very hard to ascribe any one reason to this, and I think what’s also clear is that when you talk to people in the camps, when you talk to the migrants, none of these people wants to be in Moria. These are people who would like to be home. They’ve uprooted their lives because of war or deprivation at home. And again, this is something that all of our societies have to help to manage in terms of both the push factors and also the pull factors. But I have great confidence in the ability of Prime Minister Mitsotakis’s government to manage this problem, and I also believe that it’s not a problem that Greece should be left to deal with alone.

Mangiriadis: Yeah, let’s hope for that. Let me talk a little bit about the economy. Prime Minister Mitsotakis went to New York last week. Actually, there was a scheduled meeting with President Trump or not? Because we need clarification on that.

Ambassador Pyatt: Yes, the meeting was scheduled, and it didn’t happen because of other events that I think everybody in this room is aware of, that had nothing to do with Greece.

 Mangiriadis: We understand that, but it was an issue for the public discourse here in this country, so I just wanted the clarification on that. So he went to New York, he met with some of the most important fund managers and bankers around the city, and I wondered, should we expect some more tangible results on U.S. investments in the near future coming out of that meetings. And really my question is, how much the government change is actually helping towards that direction, how much the new government is bringing like a fresh air to this economy.

 Ambassador Pyatt: I think it’s helping a lot, because this government is sending very clear messages on its commitment to facilitate investment, to remove red tape, to remove obstacles. We already see results. There’s the Pfizer announcement of their new technology center in Thessaloniki. There’s the new Cisco investment up in Thessaloniki. The week before last, I was in Patras with Minister Georgiadis. I’m always amazed when I go to Patras to discover how much is happening in the startup ecosystem there, the amount of engineering and technical talent that that city has. So these things are already happening. There’s the prospect of some very big further progress in the weeks ahead. You already had the Blackstone investment of $300 million in the tourism sector. The Hellinikon project. Remember, when I arrived in Greece there years ago, The Wall Street Journal had a story about the Hellinikon project with the headline “The Government at War with Itself.” And today, I think the government is sending a very clear message that the Hellinikon project is going to move ahead, and if either of the two leading U.S. companies that are making that bid a priority, it will be a game changer in terms of how the tourism market in Attica functions year round. So I’m very bullish about this, and I think the key is the signal that the government has been sending in terms of its eagerness to attract investment, to fast track the bureaucratic procedures that have to be accomplished, but also to capitalize on the fantastic resources that Greece enjoys: its human capital, its natural resources, its geographic location. This is an underdeveloped asset, and I think American investors are starting to realize that.

Mangiriadis: Can you be a little more specific on certain areas that we might see American investors in the near future?

Ambassador Pyatt: So I’ve talked about tourism already. I’ve talked about technology: Pfizer, Cisco, there will be more in the technology space. Energy, of course. We were very pleased to see the Parliament moving ahead on the licensing for ExxonMobil’s offshore exploration with Total and Hellenic Petroleum, the privatization of Hellenic Petroleum, opportunities in the renewable energy space. Greece is not lacking in opportunity at this point. But I think if I had to name three sectors, it would probably be those: tourism, energy, and technology/innovation.

Mangiriadis: You just reminded me you first came in this country as an ambassador in November 2016. That was three years ago.

Ambassador Pyatt: September.

Mangiriadis: September. Okay, all right, so we’re three years already. And I do remember that at the point that you started your tenure as an ambassador, the real problem for investments was the political uncertainty, the political instability, the fears of a possible bankruptcy. We’re still talking about 2016, right? So my question here now is what are barriers for investments today? Is it bureaucracy? Is it taxation? Is it the judicial system? I mean, when you talk to investors, when you talk to people who really want to invest in this country, what do you see? Is it all of the above?

Ambassador Pyatt: So I think there are two things. First of all, it’s changed a lot for all the structural reasons you’ve described. I think the continuing obstacle is bureaucratic and procedures, but there’s been a clear message, and you only have to listen to Minister Georgiadis and Minister Staikouras and others who have been very clear in terms of their commitment to make the system move. I think there’s also a little bit of a lag. I oftentimes find when I talk to people in New York or Washington or Chicago that they don’t recognize how much Greece has changed. And as I said, I am absolutely convinced that Greece is in a new era, that this government is aware of the expectations that brought it to office, and that there is the best possible team of ministers and deputy ministers and advisors working now to avoid the mistakes of the past and move the economy forward.

Mangiriadis: I hear a lot of this government talking about the digital transformation. We also listened to Mr. Pitsilis saying about it. I wonder whether you find this is a task that could be accomplished in a four-year’s tenure of this government.

Ambassador Pyatt: Absolutely.  I mean, you already see it in terms of the thriving startup sector, and as I said, the U.S. Embassy has spent a lot of time and energy on this area whether in Thessaloniki or Patras or Athens or Ioannina. I think this is an under-advertised success story. It was quite striking to me. I was with, last week, the Board of Directors and the senior management of Pfizer, and a large number of the directors had never been in Greece before they were here last week, and they were quite amazed as they discovered the quality of human capital that’s available here, the value proposition that Greece represents—cause let’s face it, it’s a lot cheaper to hire an engineer or a lawyer in Greece today compared to Milan or Munich or Paris. So Greece has all the advantages of being part of the European Union, the Eurozone, in terms of the rules, the transparency, the predictability. The uncertainty that was the case in 2015 and 2016 has disappeared, and now it’s just a matter of unlocking the value. I think that was very much part of the conversation that the Prime Minister was having when he was in New York last week.

Mangiriadis: Right. A couple more questions. I know that you have to leave, but I’d like to come to a couple of things about Cyprus, the Cypriot issue, whether you see a restart in the talks between the two sides and whether you find this whole conversation about the hydro-reserves down in the southeast Mediterranean as a sparkplug for a possible [inaudible] of the island or as a sparkplug for just a dismantling of the whole process and the division.

Ambassador Pyatt: So I will leave the Cyprus diplomacy questions to my colleague in Nicosia, the New York people, and everyone else, but what I will say is we see the energy developments in the eastern Mediterranean as extremely important. This is a region of great power competition. Great power competition has returned to the eastern Mediterranean in a big way, and we think it’s quite important that you have these conversations going on among our democratic allies, Greece-Israel-Cyprus, and then U.S. support for that through the 3+1 process, something that I’m sure will be talked about when Secretary Pompeo is here. I was also very interested to see Foreign Minister Dendias’ meeting with his Cyprus and Egypt counterparts when he was in New York, then also the meeting that Foreign Minister Dendias had with some of his Balkan counterparts. And I think what all of this underlines is the sense that Greece is back as a strategic player in this region. For many years because Greece was so focused on just keeping its head above water economically, there wasn’t a whole lot of extra bandwidth for Greece to play this diplomatic role, but I think now with the United States, Greece has gone from being seen as a source of problems to being a source of solutions, and those are solutions which help to build regional stability, create economic opportunity, create an environment where growth and investment can move ahead in a way that’s very important obviously to Greece but also, I think, to Europe, to the European Union, and to NATO, and through NATO, to the United States.

Mangiriadis: I think I’ll wrap up this conversation the way we started, with the mutual cooperation defense agreement. We all know about the importance of Souda Bay for the United States forces, and of course we know that you’re interested about Larissa and Stefanovikio. Why is Alexandroupoli important for the U.S.?

Ambassador Pyatt: Alexandroupoli is important for a couple of reasons. First of all, if you look on a map, you can see that this is a strategic crossroads. It’s an area which has emerged as major European energy crossroads. You have the TAP pipeline. You have the IGB pipeline. You have, we hope, the Alexandroupoli regassification unit. You also have some not-so-benign influences in that region from some of our geopolitical rivals, in particular Russia’s effort to undermine energy diversification, to undermine the Prespes Agreement, to inhibit the choice that multiple governments in the Balkans region have made to move toward NATO, toward Europe and Euro-Atlantic institutions. So you can think of Alexandroupoli as being a major geostrategic crossroads, but what’s been interesting to me is – and I visited Alexandroupoli three times now as Ambassador, and my first visit, which was about two and a half years ago, there was a sense that everybody felt like that they were alone when they were dealing with some of these outside influences, including from the neighbors. When I went back to Alexandroupoli earlier this month, there was fantastic appreciation for the role the United States is playing, our investment in the restoration of the full capacity of the port in Alexandroupoli, interest in the prospect of getting an American investor in the privatization of the port, which we hope very much will happen, if the conditions are right. I was also very impressed to discover there in Alexandroupoli a world class company that focuses on LED and lighting applications, which has partnerships with Ford an with other American manufacturers producing for a global market, and it’s again a reminder that Greece can surprise you, that there is this entrepreneurial capacity and the company that I was visiting was typical of those that survived the crisis because of how they managed their debt, because they were creative in looking for new markets outside of their traditional focus and are now poised to leverage all the things that I talked about that make Greece so attractive and interesting, its human capital, its price point, its geographic location. So Alexandroupoli is going to remain an area of U.S. engagement just as we have tried over the past several years to lift up the level of U.S. engagement and activity across northern Greece, as reflected in our presence at the Thessaloniki Fair. I take some pride in the fact that both Germany and France are now following America’s lead and have asked to become honored countries at the Thessaloniki Fair, and again, I think this points to a very bright future for Greece’s strategic role in this wider neighborhood.

Mangiriadis: Ok, I think that in comparison the previous three conversations that we’ve had, this time you were the most optimistic out of the three.

Ambassador Pyatt: I’m all bullish at this point on Greece and the U.S.-Greece relationship.

Mangiriadis: All right. Let’s hope for the best. Thank you very much Mr. Ambassador.