This review is part of a series of OECD Territorial Reviews created in 2001 to support regional development across OECD countries. Territorial reviews examine a range of policies to support economic growth in regions, improve the well-being of residents and support the transition to a low-carbon economy. Policies for economic growth, social inclusion and environmental sustainability are more effective when they are aligned and take into account the region-specific characteristics, assets and bottlenecks in their design.

The Territorial Review of Greece: Regional Policy for Greece Post 2020, approved by the Regional Development Policy Committee [CFE/RDPC(2020)5] on 28 May 2020, was undertaken prior to the COVID-19 pandemic and examines the role of regions and regional policy in the recovery of the Greek economy since the 2008 global financial crisis. It examines the performance of Greek regions against international trends and identifies effective policy responses and recommendations for effective implementation of regional and EU cohesion policies in Greece for the years ahead.

The release of this report comes at a critical time for Greece, having exited financial assistance in August 2018 and sustaining a path to economic recovery. This momentum needs to continue and be deepened in the coming years, despite the current COVID-19 outbreak that is hindering Greece’s recovery efforts.

Amid heightened attention on growing geographic inequality, OECD member countries have re-oriented regional development policies towards a place-based approach to foster inclusive growth. Economic and social reforms have been extensive in Greece and must be complemented by place-based policies that target or adapt them to region-specific conditions.

Place-based regional policy design and implementation can stimulate investment, improve entrepreneurial and business ecosystems and build resilient labour markets while tackling social challenges such as fostering dialogue, rebuilding trust, reducing inequalities and improving the quality of jobs and education. Place-based regional development policy can help Greek regions to realise their economic potential and capitalise on their strengths. This requires a deep understanding of how policies interact at different levels of government for maximum impact.

Regional governments need to develop their own bottom-led regional development strategies and ensure they are co-ordinated with national priorities, together with private investment and foreign direct investment (FDI) to spur local development. The OECD’s work has illustrated the importance of aligning regional development strategies with sectoral policies (support for private investment, infrastructure and human capital policies) to generate multiplier effects. To this aim, many OECD Member countries have strengthened their multi-level governance system or promoted asymmetric decentralisation in recent years. This trend is likely to continue and can help to adapt governance to various regional, metropolitan and local conditions and capacities.

While Greece has advanced on this front in recent years undertaking administrative and regulatory reforms, it is imperative to further consolidate the role of subnational governments in regional development and investment policies.

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