By Lili Bayer
Summary Greece is a highly strategic country where foreign powers have traditionally competed for influence. For European governments today, maintaining Greece as a member of Western economic and defense blocs and ensuring the country’s political stability is a priority. Greece’s strategic significance is shaping Europe’s response to the financial and refugee crises.
The first king of modern Greece, Otto I, was imported from Bavaria in the 1830s at the behest of three European powers: Russia, Britain and France. In 1863, a Danish prince was also invited to rule. As the Ottoman Empire’s hold on the region weakened, European powers became more involved in shaping the future of Greece, at times intervening militarily and directly influencing domestic politics. Much of Greece’s modern history is the story of its relationships with several major powers – Britain, France, Russia, Turkey, the United States and Germany. On the surface, Greece often appears peripheral to European politics. Nevertheless, Greece’s strategic geographic position has time and again put the country at the center of geopolitical crises and made it the subject of competition among different outside powers. Today, Greece’s continued strategic importance is shaping the response of outside powers to the country’s challenges, from debt and unemployment to refugee flows.
Greece’s Geographic Challenge and Strategic Significance
Greece’s geography has contributed to the emergence of significant strategic challenges for the country. Greece has a mountainous geography and includes about 2,000 islands and over 8,000 miles of coastline. The dispersed geography and long coastlines mean that Greece is highly difficult to both govern and defend effectively. Despite its chronic financial problems, according to the Stockholm International Peace Research Institute, Greece still spent 2.2 percent of its GDP on defense in 2014 – a higher rate than all other NATO countries except Turkey (also 2.2 percent), the U.K. (2.2 percent) and the U.S. (3.5 percent).
However, Greece’s geography has made the country a nexus for geopolitical competition. To the north are the Balkan countries, laden with long-standing ethnic tensions and historically contested by Central and Western Europe, the Ottoman Empire and Russia. To the northeast is the Black Sea, an area where Russia and the Ottoman Empire – and now Turkey and NATO – competed for influence. For Russia, influence in the Black Sea and access to the Bosporus are critical, as the Bosporus is the Russian navy’s only point of entry to the Mediterranean Sea. To the east is Turkey, Greece’s historical rival. The Ottoman Empire dominated modern-day Greece for centuries, and while both Turkey and Greece are members of NATO and thus formally allies, tensions remain over issues such as the future of Cyprus. To the south is the Mediterranean Sea, which has connected Greece to civilizations across Europe, North Africa and the Middle East. The Libyan coast is less than 190 miles away from the nearest Greek territory, while the Italian Peninsula to the west is less than 120 miles away. This strategic geography has led successive generations of European leaders and regimes to become deeply involved in Greece – from directly intervening in domestic Greek politics in the 19th century to backing sides in the Greek Civil War during the late 1940s.
German and European Strategy in Greece
Germany’s strategy today when it comes to Greece is grounded in Berlin’s need to maintain the cohesion of the eurozone. This strategy involves three main objectives: keeping Greece a member of Western economic and defense blocs, ensuring Greece’s political stability and preventing other powers from gaining influence in Athens. As we have outlined, Germany’s economic growth depends in large part on access to export markets. The eurozone provides Berlin with a secure, reliable export market where partners cannot devalue their currencies to make their own products more competitive than German goods.
Greece is not a major destination for German goods. In 2015, according to U.N. Comtrade statistics, merely 0.4 percent of German exports by value went to Greece. Nevertheless, Berlin needs Greece to remain in the eurozone, which is the reason Germany ultimately agreed to three Greek bailouts at the height of the country’s financial crisis. Germany fears that a Greek exit from the eurozone could undermine the entire bloc’s cohesion and thus threaten its access to more important European markets. At the same time, despite significant measures to shield eurozone countries from Greece’s financial troubles, they are still exposed to Greece: much of the country’s debt is held by eurozone governments. In July 2015, Barclays Research estimated that the total exposure to Greece equaled 3.4 percent of the eurozone’s GDP. Greece’s economic stability, therefore, is a priority for Berlin, and Germany has shown a willingness to implement ad-hoc solutions and bend rules in order to maintain Greece as a member of the bloc.
The European Union’s deal with Turkey to address the refugee issue, which came into effect on April 4, also stems in part from German and European Union strategic considerations in Greece. Under the terms of the agreement, refugees and migrants are being deported from Greece to Turkey, and for every Syrian refugee sent to Turkey, another will be taken in and resettled in the EU. Earlier plans to relocate refugees directly from Greece and Italy to other European Union member countries failed to be implemented, and it remains unclear whether Greece will be able to send back significant numbers of refugees to Turkey in the short term. However, the deal highlights European worries about Greece’s stability and reliability. The Greek authorities have been unable to effectively house and process refugees, and after Balkan countries closed their borders, tens of thousands of refugees were stranded in Greece. The Europeans fear not only a humanitarian and administrative crisis, but a political crisis in Greece, where much of the public already distrusts and resents the European leadership. Relocating refugees from Greece to Turkey is thus in part an effort to alleviate German and EU concerns about the status of their relationships with Athens.
European governments are also engaged in a subtle competition with the Kremlin for influence in Greece. Russia has strong economic ties with Greece, as well as relationships with several Greek political parties, including the ruling Syriza party. During debt negotiations with the European Union in 2015, Greek Prime Minister Alexis Tsipras used public overtures to the Kremlin to boost his negotiating position with the Europeans. Tsipras may have attended meetings in Moscow, but his high-profile visit in April 2015 did not yield concrete financial assistance from the Kremlin. Greece remains heavily economically dependent on the European Union. Russia cannot match what the Europeans can offer in terms of funding. Nevertheless, Russian influence in Greece remains a strategic concern for Europe, and one that countries like Germany are working to counter.
Greece’s strategic position has long compelled outside powers to get involved in the country. For European governments, and in particular Germany, maintaining Greece as a stable, pro-Western member of the eurozone is a priority. Therefore, when evaluating decisions on the migrant crisis or the eurozone’s financial challenges, European governments are closely considering their strategic priorities in Greece. Greece’s geography and membership in Western economic and defense blocs ensure that the country will remain a focal point in the region’s geopolitical crises.