Papandreou Cabinet Insider Pamboukis on Managing the

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E.O. 12958: DECL: 2020/02/18
TAGS: PREL PGOV ECON EFIN PTER GR PINR
SUBJECT: Papandreou Cabinet Insider Pamboukis on Managing the
Politics of Greek Reforms, Foreign Policy

CLASSIFIED BY: Deborah A. McCarthy, Charge D'Affaires, State, EXEC;
REASON: 1.4(B),(D)


1. (C) SUMMARY: Ambassador called on Minister of State
Haris Pamboukis February 1 to gain a better understanding of the
GoG's internal deliberations on reforms, the economic crisis and
domestic stability, and on regional foreign policy priorities.
Pamboukis, a constitutional lawyer who eschews the limelight, is
widely reputed to be one of PM Papandreou's key advisors. He was
firm on the need for promoting transparency and tackling
corruption, said the Greeks are ready for real reforms, and he
believed opposition New Democracy Leader Samaras would be
supportive. He noted that Greece's fiscal challenges are real,
but not as dire as markets (which have other agendas relating to
the euro) indicate. The GoG is operationalizing its
counterterrorism/domestic security strategy with support from a
Greek public which, since the days of the November 17 group's
attacks, had changed its views on the legitimacy of violence
against authority. Ambassador noted that Greece faces a number of
foreign policy issues at the same time it is trying to build a
consensus for major domestic reforms, and asked whether the GoG
would be able to manage all of these challenges politically.
Pamboukis noted that on most issues, especially Turkey, there is
already a broad consensus for moving forward. The GoG will press
forward on key foreign policy challenges, and Pamboukis believed
the Macedonia name issue would be resolved in the medium term -
certainly before the end of the current GoG's mandate. Improvement
in relations with Turkey must be done in small "doses" with
concrete results along the way. END SUMMARY.




2. (C) Ambassador called on Minister of State Harolambis
"Haris" Pamboukis February 1, accompanied by DCM and Pol counselor.
Pamboukis was accompanied by PM Papandreou's Diplomatic Advisor
Ambassador Dimitris Paraskevopoulos. Pamboukis is widely
understood to be one of Papandreou's closest and most trusted
advisors, particularly on domestic issues and legislation.
Pamboukis told us the GoG is proceeding methodically to address
long overdue structural reforms as it faces the financial crisis.
It is seeking long term solutions, not immediate ones as financial
markets are wont to look for. He said they realize that what
happens in Greece has serious implications for the Eurozone and he
had no doubt in the market there are speculative movements.



Transparency Key to building Public Support

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3. (C) Meeting on the day when the GoG was consulting in
the parliament on promoting transparency and fighting corruption,
Pamboukis insisted that government transparency will be key to
building public support for tough reforms. The new government's
commitment to "e-government" is central; every ministerial decision
allocating funds will have to be posted on the internet within four
days. Corruption, both large and pretty, is pervasive in Greece,
and Papandreou will lead the fight by personal example.




4. (C) In response to Ambassador's comment that the current
state of the Greek economy adds to the challenges of building
public consensus, Pamboukis acknowledged that the GoG inherited
many problems, the scope of which were still being uncovered.
Pointing to the growth in budget deficit forecasts from 3.7 percent
just before the last elections to 12.7 percent now, he said the GoG
was committed to responsibly addressing the fiscal crisis. Saying,
"we don't deserve what the markets are doing to us," he
acknowledged that the Greeks themselves were mostly responsible for
the mess confronting the country today. The GoG is constantly
reviewing its approach, and will present a new 2010 budget to
parliament before the end of February. The GoG has to confront this
crisis on three fronts: reviewing/renewing its budget to bring the
deficit down, going to EU partners for political support, and
talking down market concerns. "We created this mess and we will
solve it - in the Greek way."

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5. (C) Asked what plans the GoG had to address the
well-known shortcomings in its official statistics, Pamboukis
preferred to focus on overall improvements in government efficiency
and transparency, while managing sometimes hostile perceptions from
abroad. Pressed by the Ambassador on Wall St concerns that the
PASOK government appeared to be divided in its policy approach
between old-school thinkers and technocrats, Pamboukis acknowledged
that divisions existed "naturally" during the policy formulation
process. It's after the PM makes the decision that everyone must
fall into line. Papandreou himself was a good "father figure" for
Greeks in these hard times. He can lead the GoG in building the
public consensus needed for Greece to confront tough reforms. The
good news is that, as of now, the Greek people were understanding
of the need, and many wanted to see quick action by the GoG.




6. (C) Working with an opposition that supports reforms
offers the GoG new opportunities to push them through. Samaras and
New Democracy had so far been supportive. The GoG "will go as far
as possible" to work with and inform the opposition parties. An
example was the party leaders' conferences held later that day.



Greek Public Wants Security

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7. (C) Turning to security issues, Ambassador asked
Pamboukis his approach to fighting terrorism, given an upsurge in
security incidents in Greece over the last two years (reported
septel). Pamboukis said this was a high priority for the new
government. The outgoing ND-led government had made progress making
needed legal reforms, and the PASOK government will now look at
operationalizing them. First they will find the law-enforcement
personnel that had been trained in C/T for the 2004 Olympics, and
bring them back into service. Better use of information, including
as evidence for court proceedings, would be addressed. The GoG
would also try to "follow the money" to identify and choke off
sources of funding for these groups.


8. (C) Pamboukis was confident progress would be made -
Greek society had changed since the days of the old ideological
terrorist groups of the 1980s and 1990s. The average citizen was
not happy with the riots in December 2008, notwithstanding a long
Greek tradition of supporting "rebellion against state authority."
This was good because the terrorist/anarchist groups themselves had
changed, and now were more international and "polymorphic,"
although he did not believe that Greece's domestic terrorist groups
had any relation with international terrorism. Pamboukis believed
that Minister of Public Order Chrysochoides was effective - but the
Public Order Ministry was not always aggressive enough in arresting
individuals when evidence had presented itself. The new groups
were many and active, but they were "not nearly as professional as
the old November-17 groups."



Foreign Policy: Plan is to move Methodically

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9. (C) Turning to foreign policy issues, the Ambassador
asked whether the GoG could sustain tough compromises in the key
regional issues on which the USG would like to see movement - the
Macedonia name issue and Greece-Turkey relations. Pamboukis
replied the GoG does have a program to address these issues, but it
would be difficult to pay the political cost of compromise in this
environment. Macedonia's name is an example - he was convinced it
would be solved during the current government's term, "but not in
the next three months." Improving relations with Turkey,

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likewise, will take time and must be done in steps that result in
concrete improvements. The GoG understands that Erdogan has a
difficult internal political job ahead of him as he promotes
reforms. The exchange of letters between him and Papandreou was a
positive first step. Having said that, the GoG bases its
positions in law - while the Turkish approach appears to be based
on deal-making. This won't work. There is a mechanism in place for
the two sides to talk. The GOG does not intend to "enlarge the
agenda." The two sides should proceed only when they are prepared
to go to the end of the process - but there is scope now for
building confidence.


10. (C) BIOGRAPHICAL NOTE: Minister of State for the Prime
Minister Haris Pamboukis: A professor at the law school of the
University of Athens, Haralambos Pamboukis is often considered the
prime minister's alter ego. He is responsible for the horizontal
coordination of the different ministries and their jurisdictions
and elaborating the strategic choices of the government in all the
critical spheres of the policy making. He studied Law at the
University of Paris (N!aris 1- N!antheon Sorbonne). PhD from the same
university (January 1990 Docteur d'Etat en droit (Tres honorable)
L' acte public etranger en droit international prive, pref,
Lagarde, Bibliotheque de droit prive, t. 219, Paris, LGDJ, 1993
XXII+360 ). Alternate Professor of international private law at the
Law Faculty of Athens. Honorary Professor at the International Law
Academy of The Hague. Partner of Law Office
Siouti-Pamboukis-Flogaitis of Athens focusing mainly on
international mediation and alternative disputes resolution. (Ms
Siouti is the law expert at Papandreou's office and Flogaitis has
been appointed several times caretaker Minister in charge of
national elections). Long standing relations with the PMs family.
He has vacationed many summers with George Papandreou in Southern
France. Director of the political office of Papandreou and
Secretary General of the MFA when Papandreou was Foreign Minister.
Born in 1958 in Athens, married. He speaks English. He is one of
the five persons George Papandreou talks and consults and spends
private time with (the others are: the Director of his office and
long-standing PASOK professional cadre Nikos Athanasakis, Deputy
Education Minister John Panaretos, Culture Minister Paul
Geroulanos, and his brother Nikos Papandreou).
MCCARTHY