Original publication: April 2018
Author: Beata Tuszyńska
Short link to this post: http://bit.ly/2Ilo9jt

This overview of the transport and tourism sectors in Greece was prepared to provide information for the mission of the Transport and Tourism Committee to the country between 7 and 9 May 2018.

Introduction

Greece mapGreece is located in the south-eastern part of the European Union (EU) and borders by land Turkey, Bulgaria, Former Yugoslav Republic of Macedonia (FYROM) and Albania. The country is surrounded by three seas: the Ionian Sea from the west, the Aegean Sea from the east and the Mediterranean Sea from the south. In terms of size, Greece is ranked the 10th country in the EU, while its inhabitants (almost 10.9 million in 2017) constitute 2.14% of the EU’s population. The country is composed of three distinctive geographical areas which include: a peninsular mainland, the Peloponnese Peninsula and around 6,000 inlands. Almost 80% of the country’s area is covered by mountains and hills, which makes Greece one of the most mountainous countries in the EU. The country joined the EU on 1 January 1981 and adopted the euro in 2002.

The Greek economy grew on average about 4% per year between 2003 and 2007, but it went into recession in 2009 as a result of the world financial crisis, tightening credit conditions, and of the country’s failure to address a growing budget deficit. By 2013, the economy had contracted 26%, compared to the pre-crisis level of 2007. In 2014, the Greek economy began to show the first signs of recovery and generated 0.7% GDP growth. In 2017, Greece saw further improvements in GDP and unemployment. However, unfinished economic reforms and a massive non-performing loan problem are among the major factors holding the economy back (please see Table 1 below for more details on Greek economic indicators).

Table 1: Macro-economic forecasts for Greece

The most important sectors of Greece’s economy in 2016 were wholesale and retail trade, transport, accommodation and food services (24.5%), public administration, defense, education, human health and social work activities (21.0%) and real estate activities (17.7%). In the same year, 56% of Greece’s exports was intra-EU with major trading partners including Italy 11%, Germany 8% and Cyprus 6%, while outside the EU – 5% of trade went to Turkey and 4% to the United States. In terms of imports, 55% came from the EU Member States (Germany 11%, Italy 9% and the Netherlands 6%), while outside the EU – 7% came from China and 6% from Russia.

In 2016, Greek contribution to the EU budget amounted to EUR 1.5 billion, which represented 0.86% of the country’s Gross National Income (GNI). At the same time, Greece received EUR 5.85 billion from the EU’s budget, equivalent of 3.32% of the country’s GNI.

General Information on Transport

As presented in Figure 1 below, transport by road remained the predominant inland mode for both passengers and freight in Greece in 2015 and its market share of 97% in both segments was above the EU averages of 90.7% and 71.7% respectively. The dominance of the road transport is partly due to the characteristics of the country’s terrain and inadequate railway infrastructure.

In 2015, buses and coaches in Greece transported 17% of passengers travelling by land, almost double the EU average of 9%. However, the market share of Greece’s rail transport in both segments continued to be on a low level compared to the EU average of 17.4% for freight and 7.6% for passenger transport.

 

Figure 1: Modal split of passenger and freight land transport in Greece

With a share close to 20% in 2015, Greece is the 1st country in the EU in terms of employment share in high growth transport enterprises (against the EU average of 12%). This means that Greek transport companies are growing and hiring. However, the share of women working in transport in Greece is one of the lowest in the EU (15.5% compared to the EU average of 22%). All of EU transport related directives have been transposed into Greece’s national law.

2.1 Energy efficiency of transport and low emission mobility

The transport sector is responsible for the largest share of total final consumption (TFC) in Greece, consuming 5.8 Mtoe in 2015 (or 35% of the country’s TFC). Greece’s transport energy consumption peaked in 2009 at 8.4 Mtoe, but fell by one-third in the three years to 2012, and has been stable since then. Road transport accounted for 88% of the country’s total transport energy consumption in 2014. The rest consisted of sea transport (8%) and small shares of domestic aviation and rail transport. Passenger vehicles accounted for over half of the energy consumption within road transport, with freight transport responsible for most of the remaining energy use (please see Figure 2 below for more details).

Figure 2: Energy consumption by mode of transport in Greece, 2014

In 2015, Greece was among the only three Member States (with Lithuania and Latvia) that consumed less energy in the transport sector, compared to 1990. In fact, between 2000 and 2014, the energy intensity fell by 41% in passenger transport and by 43% in freight transport in Greece. This was attributed by a large extent to the economic and financial crisis, which resulted in a lower transport activity, but also to measures implemented by the Greek Government to improve the fuel efficiency of passenger vehicles, as well as to the introduction of energy efficiency obligation programme. Since 2005, transport fuel taxes have grown by 0.7 percentage points, contributing 1.8% to the Greek GDP in 2015.

In Greece, the share of renewable energy in transport has been rising gradually since 2011, however the advancements in this area have been quite slow. With 1.4%, Greece was ranked 3rd last among the Member States for the share of renewable energy in transport in 2016 and it is unclear if the country will be able to reach the national target of 10% by 2020 as imposed on all Member States by the Renewable Energy Directive. Also, both the number of charging points for electric vehicles and the market share of electric passenger vehicles in Greece are among the lowest in the EU.

2.2. Transport Infrastructure Quality

As for the quality of transport infrastructure, the Greek ports and especially the rail infrastructure are rated relatively low, however the quality of roads and air transports are around the EU average. This assessment is also reflected in the analysis of the 2016 World Bank Logistics Performance Index (LPI), which shows that Greece is lagging behind the leading Member States in terms of quality of transport infrastructure. Among the components of the LPI is quality of trade and transport related infrastructure (e.g. ports, railways, roads, information technology), as well as efficiency of the clearances process by border controls and the logistics quality and competence, which were the lowest rated components of the Greece’s LPI.

In terms of the timeliness of shipments, Greece was ranked 19th out of 28 Member States in 2016, with the value of 3.85 being below the EU average. Nevertheless, consumer satisfaction with transport in Greece is close to the EU average for all modes of transport, with a positive tendency throughout.

Recently, major steps have been taken in the area of logistics, a core sector for the country’s growth, as Greece adopted secondary legislation required to implement the logistics law. This legislation is aimed at the simplification of the licensing procedure and the stabilisation of the legal framework for the sector.

2.3. The Trans-European Transport Network (TEN-T)

Map 1: The OEM Corridor - focus on GreeceOne multimodal TEN-T Core Network Corridor (CNC) crosses Greece (please see Map 1 on the left).

The Orient/East-Mediterranean (OEM) Corridor is a long north-west to south-east corridor which connects the maritime ports of the North, Baltic, Black and Mediterranean Seas in central and southeastern Europe. It involves nine Member States (Germany, the Czech Republic, Slovakia, Austria, Hungary, Romania, Bulgaria and Greece with Cyprus connected remotedly with the Greek ports of Thessaloniki, Igoumenitsa, Patra and Piraeus via a “Motorway of the Sea”). In Greece, a road section of the OEM Corridor (from the Bulgarian/Greek border to Thessaloniki) overlaps with the international road route: Via Carpatia, which offers the shortest seamless connection between northern and southern Europe, with extensions to Ukraine and Turkey.

Major missing links in the OEM Corridor include multimodal connections between Hungary, Bulgaria, Romania and Greece, which are yet to be constructed or substantially upgraded. Cross-border traffic management systems on rail and inland waterways are still to be implemented on many sections.

To date, major success stories of the project implementation in the OEM Corridor include the completion of the high-speed link between the Greek ports of Athens and Thessaloniki early in 2018, giving fast access between the two ports in the north and south of the country.

Greece is doing well in the completion of its TEN-T Core Network with 76% of the core road network and 80% of the conventional rail network completed. The high-speed rail network stands at 55% completion. Within 2007-2013 financial perspective, Greece spent almost EUR 19.3 billion on TEN-T projects.

The Connecting Europe Facility (CEF) has selected 24 transport projects involving Greece in the CEF calls 2014-2016, of which ten projects are actions exclusively in Greece. Nine of these ten projects foresee actions on railway lines and three projects concern bottlenecks and missing links of the OEM Corridor. The estimated cost of all exclusively Greek projects selected under CEF Transport calls 2014-2016 is around EUR 842 million, with a maximum EU contribution on average of 69%. The remaining 14 selected projects are joint projects, where Greece is one of two or several Member States involved.

Table 2: CEF transport projects in Greece approved in calls between 2014 and 2016

2.4. Greece’s transport development plans and programmes

In May 2017, Greece has started preparing a comprehensive National Transport Plan (NTP) with a time horizon to 2037. Its aim is to identify future necessary policies and investments in the country’s transport sector which will constitute the basis for sustainable transport infrastructure and service development in Greece in the medium- and long-term. The NTP is expected to be completed in the 1st half of 2019.

The objectives of the Greece’s Operational Programme (OP) Transport, Infrastructure, Environment and Sustainable Development 2014-2020 in the field of transport include:

  • the promotion of completing part of the infrastructures of the TEN-T core network (road and rail) and improving the TEN-T comprehensive network (with emphasis on road and rail, but also with focused interventions on ports and airports);
  • the promotion of combined transport and the modernisation of the transport system;
  • the improvement of road safety; and
  • the development of sustainable and ecological urban transport (track-based modes).

The total OP budget for Greece amounts to EUR 5.2 billion and the maximum EU contribution is expected to reach EUR 4.3 billion. Between 2014 and 2020, Greece intends to spend nearly EUR 1.3 billion of the Cohesion Policy funds (amounting to a total of EUR 3.18 billion for the country) on transport and environmental projects, which will include primarily:

  • the urban public transport systems in Athens and the region of Attica – estimated cost of EUR 377 million;
  • the extension of the metro in Thessaloniki and in the city of Kalamaria, in central Macedonia – estimated cost of EUR 730 million;
  • the sustainable mobility in the Peloponnese Peninsula – estimated cost of EUR 50 million, which will be spent for the modernisation of section of the Athens-Patras railway line (part of the OEM Corridor); and
  • the improvement of transport connectivity in the north of Greece – estimated cost of EUR 92 million.

In 2016, Greece had 69 infrastructure projects in the pipeline for completion by 2022 totalling EUR 21.4 billion, out of which 46% accounted for rail and motorway projects.

Link to the full briefing: http://bit.ly/617-469

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