NEWSLETTER FEBRUARY19

INVESTING IN RECORD GREEK BANKS TACKLE HEALTHCARE EXPORTS BAD LOANS

The newsletter is a monthly publication of Enterprise , the national investment and trade promotion agency. NEWSLETTER FEBRUARY19 Investing in Greek

Foreign investors have been acquiring leading private hospitals in Greece, banking on the sector’s growth potential and the country’s Healthcare status as a regional hub in health and life scienc- es. As it is, Greece is already a major hub for both R&D and testing in life sciences research. With In the past two years, leading private equity six doctors per 1,000 inhabitants, Greece has fund CVC Capital Partners – one of the largest the highest per capita ratio of doctors in the private equity funds in the world -- has acquired OECD and the sector commands almost the Metropolitan Hospital based in the southern one-fifth of total research and development suburbs of Athens, and the Ygeia hospital group spending in the country, well above the Europe- based in the northern suburbs. It has also an average. acquired one of hospitals belonging to the Iaso health group, and is currently in the process of Greece serves as a regional hub for clinical trials buying a second. of new pharmaceutical products, and its dozens of local pharmaceutical producers are leading Last spring, San Francisco-based Farallon Capi- exporters – particularly in generics -- to the rest tal, another private equity fund, raised its stake of Southeast Europe. Overall, the Greek phar- in Greece’s Euromedica group to 17.5% after maceutical and life sciences sector accounts for acquiring €200 million in the company’s debt 3.5% of GDP and €1 billion worth of exports. from local Greek banks. More recently, a tender for the former Red Cross-owned Henry Dunant Many industry experts say that Greece’s health hospital – now controlled by Piraeus Bank – sector also holds future prospects in new areas drew strong interest from several foreign inves- as well. These include a growing role for medical tors, including Farallon Capital and United Arab tourism and, by leveraging the country’s warm Emirates sovereign wealth fund Mubadala climate and Mediterranean location, Greece Investment Company. could also draw seniors from across Europe and become a leading provider of long-term care and services for the elderly.

Greece’s Life Sciences Sector in Numbers Source: Hellenic Association of Pharmaceutical Companies (SFEE) Companies Pharmaceutical of Association Hellenic Source: NEWSLETTER FEBRUARY19 news in

Greek Bonds briefTourism Record Greece successfully issued a new, 5-year Advance tourist bookings are growing at a government bond, it’s first since exiting the double-digit rate, signaling another banner last of its three financial support packages last year ahead for the Greek tourism industry, August and further demonstrating the coun- Tourism Minister Elena Kountoura said. Speak- try’s renewed access to international markets. ing in a radio interview on Alpha, she said 2018 The bond was more than four times was a record year for Greek tourism with the subscribed and priced at a yield of 3.60%. The country welcoming 33 million visitors and strong demand for the issue underscore grow- collecting €16 billion in revenues. ing investor demand for Greek debt, with yields on both short-term Greek paper and also the benchmark 10-year bond recently Marina Privatization falling to multi-month lows. Greece's privatization agency received three binding offers for the Alimos Marina south of Athens, the largest marina in southeast Greek Economy Europe. The three bidders include Aktor Con- The European Commission has raised its cessions, Aviareps-Cosmos Consortium and growth forecast for Greece this year to 2.2% Lamda Dogus Marina Investments. The privat- and to 2.3% next year, according to its winter ization is expected to be completed through forecasts. The report said that net exports an online auction to be held in March. were the main driver behind Greece’s econom- ic recovery, but that growing consumer demand and increased investment spending Piraeus Port were also helping to support growth. The port of Piraeus, controlled by Chinese shipping giant Cosco, handled a record 4.9 million TEUs of containers in 2018 making it the Balkan Exports second busiest container terminal in the Medi- Enterprise Greece organized two seminars for terranean. According to data from the port Greek businesses on export opportunities in authority, the number of containers increased Southeast Europe, traditionally an important by 18.4% compared with a year earlier. market for Greek exporters. The seminars, held in the first week of February in Athens and Thessaloniki and in cooperation with the Greek Mergers & Acquisitions foreign ministry, are part of the country’s The number of mergers and acquisitions in National Strategic Development Plan 2020-30. Greece increased sharply last year, according to a report by consultancy PwC, reflecting growing business activity in the country. In Athens Hotel 2018, Greek corporates engaged in 51 M&A The historic Esperia Palace Hotel in central deals worth a combined €3.8 billion, com- Athens has been sold to Israel’s Fattal Hotel pared with 39 transactions worth a total of Group, which aims to renovate the property €1.9 billion a year earlier. and re-open it as a five star hotel. The hotel is owned by Greece’s social security fund and was the first of several, centrally located prop- erties being sold off by the fund. NEWSLETTER FEBRUARY19

Greece’s exports have reached another record Greek Exports Reach high, driven by growing export prowess from Greek companies and growing worldwide Record Highs demand for Greek products like the country’s famed food and beverage products.

Last year, Greek exports totalled €33.4 billion, GREEK according to the latest data from the Hellenic Statistical Authority, up 15.7% from 2017 and are Feta is arguably the best-known [ke-fa-lo-gra-vee-AIR-a] Greek abroad. In 2004, Another pale yellow cheese with already on track to grow further this year. the European Union granted a hard rind and an abundance of Greek Feta a PDO (Protected small air pockets. As its name Known for its quality Mediterranean produce – Designation of Origin) status and indicates, it falls somewhere issued a decree prohibiting between and like its olives and olive oil – Greek exports of European countries other than in both flavor and texture. wines, cheeses and other food products have Greece from using the name Feta. KEFALOTYRI [ke-fa-lo-TEE-ree] In Europe, similar cheeses are also been gaining recognition in world markets. A very hard, light yellow sheep’s called “brined white cheese.” or goat’s milk cheese with a Within Greece, Feta can be made sharp, tangy flavor. The cheese is only in specific regions: Macedo- made mainly in Crete, as well as nia, Thrace, Thessaly, Central in Naxos, Cephalonia, Thessaly, Mainland Greece, the Pelopon- and Epirus. It is a popular grating nese, and Lesvos. cheese. ANTHOTYRO [an-THO-tee-ro] LADOTYRI [la-do-TEE-ree] The word literally means WINES PINK GRAPE VARIETIES Another unique product, the “blossom cheese,” named after name of which means “oil the way the curds “blossom” as WHITE GRAPE MOSCHOFILERO cheese.” The cheese, which is they are stirred. The curds rise to VARIETIES [mo-sko-FEE-le-ro] shaped like miniature barrels, is the tops of the vats and open in a Light with vibrant acidity, floral steeped in olive oil and aged for shape resembling flower ASSYRTIKO [a-SEER-tee-ko] aromas, and incredible elegance. several months. Lesvos is the blossoms. The cheese is similar to The finest Greek white variety and most famous place in Greece for , but lightly salted. It is arguably one of the best in the RED GRAPE VARIETIES Ladotyri. eaten fresh with jam or honey, Mediterranean. and often baked into sweet MANOURI [ma-NOO-ree] AGHIORGITIKO ATHIRI [a-THEE-ree] pastries, especially around Easter. This is a creamy, buttery, mild, [a-gee-or-GEE-tee-ko] Widely grown in the Cyclades and white cheese that is sold in Closely associated with Nemea in GRAVIERA [Gra-vee-AIR-a] Dodecanese islands. Quite soft log-shaped loaves. It is excellent the Peloponnese, it produces a One of the best table cheeses in and round. as a dessert cheese, topped with huge variation in styles ranging Greece and produced in several honey, or with poached fruits, MALAGOUSIA from fresh young reds to dark, areas. Graviera is generally a and complements the sweet [ma-la-ghoo-zee-A] full-bodied wines. nutty, pale yellow cheese with a wines of Greece exceptionally It can impress purely by its hard rind made either from KOTSIFALI [ko-tsee-FA-lee] well. remarkable character and sheep’s milk or from cow’s milk, Mainly cultivated in Crete. individuality. depending on the region. Some [me-tso-VO-ne] LIMNIO [lee-mnee-O] of the best-known sheep’s milk This is a rich, hard, smoked, MUSCAT It produces full-bodied wines with Gravieras come from Crete, yellow cheese made in Metsovo, Traditionally used for the a high alcohol content. Mytilene, Dodoni, Arta and Epirus. It resembles smoked production of sweet wines. Kalpaki. Cow’s milk Graviera, Provolone. Metsovone is made in MAVRODAPHNE ROBOLA [ro-BO-la] which is yellower and a little large sausage-like loaves, usually [ma-vro-DAF-nee] The most important grape of the creamier, is made mostly in Tinos, from raw cow’s milk. Cultivated in the northwestern Ionian Islands. Syros, Naxos, Corfu, Larissa, and Peloponnese and the Ionian MYZITHRA [mee-ZEE-thra] Serres. RODITIS [ro-THEE-tees] Islands, the “black laurel” grape, The word dates to the 16th Broad and rich, without any as its name translates, is deeply [Ka-SEH-ree] century, when it referred to a heaviness. colored, with intense aromas. Kasseri is the most popular table kneaded cheese. Myzithra is a cheese after Feta. It is a mild, soft, white cheese that resembles SAVATIANO [sa-va-tee-a-NO] XINOMAVRO [xee-NO-mav-ro] yellow, spuncurd cheese made cottage cheese and is a byprod- Greece’s most widely-planted A dark red that produces wines of from either ewe’s or cow’s milk. uct of Feta. white variety. great character.

Source: Enterprise Greece NEWSLETTER FEBRUARY19 COMING UP MARCH

• Greek statistics service releases 4Q/2018 GDP data (March 3)

• Enterprise Greece: Greek wines buyers’ forum, Athens (March 3-7)

• Foodex Japan 2019, international F&B exhibition, Tokyo (March 5-8)

• The Big 5 Saudi, building products trade fair, Jeddah (March 10-13)

Greece Steps up Efforts • MIPIM 2019, international property trade to Resolve Problem Loans fair, Cannes, France (March 12-15) • Construct Ambient Expo, building products trade fair, Bucharest (March 14-17) Greece is stepping up efforts to further reduce the stock • Cosmoprof Bologna, cosmetics & beauty of non-performing loans plaguing the Greek banking products fair, Bologna (March 14-18) system, even as Greece’s banks continue to beat targets set by European regulators. • ProWein, wines and spirits trade fair, Düsseldorf (March 17-19)

• Seafood Expo North America, seafood products exhibition, Boston (March 17-19) Through write-offs, loan sales and restructuring agree- • Museum of Arts and Design, jewelry ments, the banks have reduced their stock of bad loans to exhibition, New York (March 21-24) less than €85 billion, down from a €107 billion peak in March 2016. By the end of 2021, the Greek banks want to reduce those bad loans by another €50 billion, say bank- ing sources, ahead of targets set by the European Central Bank.

In both Frankfurt and Athens, regulators are discussing a range of options with decisions expected to come in the CONTACT US weeks ahead. The plans range from the creation of special, To learn more about the many public entities to absorb or manage bad loans, to a fresh investment and trade opportunities capital injection from bank overseers, to government sub- Greece offers, visit us today at sidies for certain distressed assets, like mortgage loans. www.enterprisegreece.gov.gr

In the meantime, Greece has developed an increasingly 109 Vasilissis Sophias Avenue active secondary market in distressed assets that has 115 21 Athens attracted more than a dozen foreign funds in the past GREECE three years. T: +30 210 335 5700 Email: [email protected]