Invasion of Ukraine leaves Greece with grave fears on two fronts

The invasion of Ukraine by Russia has had serious repercussions in two areas of Greece's economy and political status that appear to be unrelated but in fact are equally disturbing in respect of long-term political relationships.

Greece's support for EU sanctions against Russia has resulted in the cancellation of Russian tourism to both Greece and Cyprus. Having enjoyed exponential growth in tourism from Russia in recent years (almost 600,000 travellers in 2019, spending more than €400 million), Greece was anticipating 300,000 visitors from Russia this year, mainly in Russian-owned resorts.

Instead, it's expected that these tourists will travel to Turkey, Egypt, Tunisia, the United Arab Emirates and Vietnam.

Greek politicians are worried that Russia's unilateral invasion of Ukraine could encourage Turkish president Recep Tayyip Erdogan to emulate this aggression

Cyprus, too, will suffer with the loss of Russian tourists. The long-standing Russian ambassador to Cyprus, Stanislav Osadchiy, spoke unequivocally, and his remarks might as well apply to Greece: "Economic sanctions do not worry us. I think Europeans are shooting themselves in the foot. Russian tourists will not come. Where will these tourists go? They'll go to Turkey; you want that? They'll spend money there."

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The loss of revenue to the Greek economy is very serious. But Greek politicians are equally worried – if not more so – that Russia's unilateral invasion of Ukraine could encourage Turkish president Recep Tayyip Erdogan to emulate this aggression by attempting to regain the eastern Aegean islands, which were awarded to Greece in international treaties between 1923 and 1947.

Vital islands

Erdogan has demanded the rescinding of these treaties, claiming that the islands (which include Lesbos, Chios, Samos, Icaria, Lemnos and Samothrace) are part of Turkey’s “Blue Homeland”. From a financial point of view, these are vital to Turkey’s continued economic survival as they sit on huge deposits of gas and oil.

Given that Turkey’s 1974 illegal invasion of northern Cyprus has never been challenged, and continues to this day in the self-styled “Turkish Republic of Northern Cyprus”, the anxiety of the Greek government about a Turkish invasion of its islands, inspired by Vladimir Putin’s invasion of Ukraine, is not unreasonable.

While 300,000 is a small proportion of the 34 million visitors in 2019, Greece has been struggling through the pandemic to regain those figures

Meanwhile, a convoy of 21 vehicles transported 82 ethnic Greeks out of the war zone surrounding the city of Mariupol in southeast Ukraine. The deaths of at least 10 Greeks in Mariupol, where a community of about 120,000 ethnic Greeks has existed since the 18th century, have caused intense anti-Russian feelings.

Greece has offered to create 50,000 jobs for Ukrainian refugees in the hospitality sector, many of whom would quite possibly be Pontic Greeks, who have been living around the Black Sea area in southern Ukraine. Although most Greeks have lived historically in or near Mariupol, on the Sea of Azov, others fled the anti-communist purge following the Greek civil war of 1945-48 to live in Ukraine and Crimea.

Pandemic diminution

Ironically, though, it is precisely the hospitality sector that will suffer from the loss of Russian tourists. While 300,000 is a small proportion of the 34 million visitors in 2019, Greece has been struggling through the pandemic to regain those figures. If and when the Ukraine crisis has passed, the building of Russian tourism will have to start again. Greece can ill afford any diminution of the markets where it had been making significant gains up to the start of the pandemic.

There is also very significant Russian investment in Greek real estate and the tourism industry. With strong Russian and US naval presence in Greek waters as the Ukraine crisis remains volatile, the congruence of economic and political anxieties becomes ever more acute.