- Associated Press - Sunday, July 31, 2011

ATHENS — A few Greek entrepreneurs perch in front of laptops in bare offices above a ground-floor supermarket, a five-minute walk from the Athens square convulsed by riots two months ago over the country’s economic crisis.

“Innovate,” a wall slogan exhorts. “Originate.” A bowl of fist-sized plastic balls sits on a table, ripe for the plucking.

Sure, the touches are geeky. But if there is hope for debt-laden Greece, which has just been bailed out again by the European Union, there is a glimmer of it here. A small enterprise called CoLab Workspace rents space to tech-savvy startups on the theory that the more they mingle, the more they thrive.

This nascent pocket of dynamism won’t make much of a dent in a culture of freeloading and favor-trading that burrowed deep into the Greek psyche, but it is a symbol, however rarefied, of fresh thinking.

For the problem is not just the numbers, the dots that connect a picture of economic collapse. Unemployment, austerity measures, bailout funds and the slumping stock market are one thing.

Modern Greece, whose ancestors laid the foundations of art, democracy and individualism, also is reckoning with ingrained habits of dependence, accompanied today by a yawning sense of betrayal and hopelessness, that block its path to recovery.

“It’s extremely difficult. Here, in general, innovation never existed. The majority of the companies, they relied on the state, on the government. It was a totally wrong approach,” said Vassilis Nikolopoulos, a computer engineer whose information technology startup, Intelen, aims to help firms monitor and curb their energy consumption.

He recently shifted his operations to CoLab Workspace from a conventional office that cost more.

Declaring that “the state is dead,” in that it has no money to support projects, Mr. Nikolopoulos said he has raised about one-third of the roughly $300,000 needed for initial funding from private investors and that his seven-member company plans to export services even if it entails failure, a rite of passage for any aggressive entrepreneur.

“We only consume,” he said of the passive culture of Greek business. “There was no need to create something, because you would sell to the state.”

Educated in several European countries, Mr. Nikolopoulos registered his company in the Mediterranean island of Cyprus to attract foreign investment from traders who give Greece a wide berth, and to avoid the shackles of Greek business culture, including corruption, bureaucracy and heavy taxation.

Mr. Nikolopoulos is the picture of a smart corporate executive, with the jargon to match — he says he will “attack the market” — but he draws inspiration from some unexpected sources.

Outlining his business philosophy, he evoked Vladimir Lenin’s revolutionary vision and praised the prime minister of Turkey, Greece’s historical enemy, for firm leadership while presiding over his country’s economy boom.

Many of Greece’s brightest minds, however, feel they have no choice but to build careers abroad, anticipating an opportunity drought that will last a decade.

Nikos Georgiopoulos, a 29-year-old former employee of the International Monetary Fund, recently found a job in the insurance industry in Vienna, Austria. His sister, a biologist, failed to find work in Greece and got a job in Switzerland. His father imports auto parts but is struggling to keep his small business afloat.

In the old days, Greece’s institutions were inefficient, but people complained less because the money was flowing, Mr. Georgiopoulos said.

Now that the government is cutting spending and salaries as part of a pact to secure international funds, he said, the “tradeoff between state and society” has crumbled and, as in the Great Depression before World War II, the wealthy will suffer far less than those of modest means.

“People actually don’t know what is going to happen to them,” he said. “They start to show signs of societal disintegration.”

Deep in recession, Greece is struggling to reduce its budget deficit from 10.5 percent of GDP in 2010 to 7.5 percent this year as it implements harsh austerity measures that combine pension and public-employee wage cuts with tax and retirement-age increases. Greek unemployment has soared to more than 16 percent overall, and more than 40 percent of Greeks aged 15 to 24 don’t have jobs.

The hardship has eroded the credibility of the state.

One snapshot of that decline came in June as presidential guards held vigil at the Tomb of the Unknown Soldier outside parliament, garbed in caps and tassels, kilt and stockings and shoes with pompons.

One spectator vaulted a barrier and lurched back and forth in a crude parody of the slow, stylized march of the guards, an elite unit whose history dates to the battles against Greece’s Ottoman rulers.

In the English-language Kathimerini newspaper, commentator Nikos Konstandaras wrote that Greek society does not trust its institutions, tolerates extreme behavior and is given to division, as illustrated by a conflict between the king and the prime minister in the early 20th century and by the civil war just after World War II.

He recalled “The Iliad,” the ancient Greek poem in which King Agamemnon and the warrior Achilles quarrel during their expedition against the city of Troy, jeopardizing their campaign.

“We don’t see the essence of problems [and so we cannot solve them]. We don’t cooperate with each other. We lose any moral high ground that we may have, and we flirt endlessly with catastrophe,” Mr. Konstandaras wrote. “Yet we persist with our mistakes.”

The mass of street protesters, the public face of Greek discontent, contrasts with the clique of earnest professionals at CoLab Workspace, which has half a dozen clients, including a developer of entertainment software and a company that provides seed funding to high-tech startups.

Co-founder Stavros Messinis said the aim, inspired by similar projects in San Francisco, was to foster an “alternative culture,” but he acknowledged that the “Greek reality” poses risks.

“We’re just about covering costs, but confident we’ll turn a small ’operational’ profit,” he wrote in an email. “I say ’operational’ because the mission here is about fostering and creating at this stage. We’re likely to plow any profits back into growing the concept.”

Markus Stolz, a German businessman who married a Greek and lives in Greece, said he was “shocked” years ago when he learned how little Greek wine was sold abroad, an opening that he quickly exploited to build an export market to Europe and the United States.

He said Greeks generally lack that can-do spirit.

“People concentrate heavily on the problems they face rather than trying to execute things,” Mr. Stolz said. “There are lots of bureaucratic issues. But in the end, people need to start something just to get going.”

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