Delphi Economic Forum – A small US official presence, but long American shadow

Washington deeply involved in the region, investors mostly on hold


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DELPHI, Greece – At the February 28-March 3 Delphi Economic Forum, (DEF) entitled “The Challenge of Inclusive Growth” the long list of invited American academics, foreign policy wonks and business people overshadowed the relatively small but tightly focused official American presence.  Now in its fourth year, the 2019 Delphi Economic Forum has grown into a true Davos-like venue, with an extensive line-up of over 80 thematic sessions, more than 500 speakers from 32 countries, and over 2,500 delegates and 200 accredited members of the press.

The Delphi Economic Forum is expanding steadily

Initially ambivalent, Greece’s SYRIZA government has steadily warmed up to Delphi since its launch in 2016 and participated extensively this year, as in 2018, with particular attention on May’s upcoming Euro elections and Greek national elections which must be held by October at the latest.  Greek Prime Minister Alexis Tsipras gave Delphi’s keynote speech again this year.

Space is hard to find.  To accommodate the surging attendance, Delphi’s organizers now routinely book all of the available accommodations in the town of Delphi and in other nearby towns. As with Davos, the amount of side business conducted at Delphi has increased its regional and global appeal for senior policymakers.

American presence- more than meets the eye

The US presence this year was headed by the State Department’s Deputy Assistant Secretary for European and Eurasian affairs, Matt Palmer, operationally responsible for Greece, Turkey, Cyprus and Southeastern Europe.  Some observers noted, however, that no current US officials from federal agencies involved in trade, investment, or finance attended.  However, the delegations from American think tanks included former US ambassadors to various European countries, three of whom had served in State Department positions equivalent to, or even higher than Palmer’s current posting, meaning the combined total of American officials’ experience this year at Delphi, when added to the incumbent US Ambassador, hit a new high and enriched discussions accordingly.

Palmer and several other US think tank travellers conducted a range of side meetings in Athens either before or after the DEF’s official sessions, as well as extensive side discussions with senior officials from across the region who were attending the Forum as well.

Also of note were several verbal exchanges with diplomatic representatives from Russian Federation, who responded – sometimes aggressively – to any references of Russian interference in North Macedonia – before its name changed – by pointing out the American Ambassador in Skopje’s penchant for personally attending key votes in the country’s parliament when critical issues hung in the balance, implying that the US envoy was present to directly manage the votes.

US foreign policy – not only Trump’s follies

While the American participants at Delphi joked about nobody being left on DuPont Circle, where Washington’s top foreign policy think tanks cluster, the discussion on US foreign policy made it clear it was not all about US President Donald J. Trump and his daily political needs.  In the panel entitled “USA – Global shifts and national priorities” Ambassador (ret) Dan Fried of the Atlantic Council argued that some of Trump’s more shocking foreign policy decisions might have happened regardless of who occupied the White House. While critical of Trump’s operating practices that could lead to a new era of US isolationism, Fried argued Trump made the right call on trade with China, North Korea’s nuclear program, and in pressing NATO allies to increase defence spending.  Even so, Trump got it wrong when it came to pressing reliable US allies on trade and elevating his relationship with both Putin and Kim Jong-un to media spectacles, thus raising their expectations unrealistically.

Trump’s basic approach to foreign policy is little more than a reflection of his “transactional” approach to almost everything he encounters, argued former White House staffer Molly Montgomery from the Albright Stonebridge Group in Washington.

Everything is a one-shot deal for Trump, who focuses on tactics, not strategy.  Accordingly, he gets along better with like-minded autocrats than partners and does not perceive the true long-term value of stable alliances for the United States. For Trump, each policy decision is a stand-alone transaction.

It is also important to keep in mind that the extended surge of economic growth in the US, giving Trump some breathing room, has been accompanied by massive changes and disruptions to many key institutions and industries, argued Deborah Wince-Smith, CEO of the Global Federation of Competitiveness Councils.

US investors interested but hesitant

There was no shortage of US business interest in the Greek and the wider regional market based on company participation at Delphi Forum IV.  However, if the tourism sector is excluded, the oft-promised surge in US investment in Greece remains in a holding pattern.   Former European Commission President and current Goldman Sachs Chairman Jose Barroso explained this phenomenon succinctly by stating at Delphi on March 3 that markets had already factored in a victory by main opposition party New Democracy in Greece’s next elections sometime this year, which appeared to explain a great deal of the increase in investor confidence.

Washington’s views on Greece and Eastern Mediterranean energy resources

US Ambassador to Greece Geoffrey Pyatt was not the only foreign ambassador at this year’s conference to have a 20-minute “in-conversation” session.  Nonetheless, it was the most important and most Greek news outlets gave it major coverage.   Pyatt’s main points were that “Greece was back,” thanks to its ongoing economic recovery and that America had returned to Northern Greece, reiterating the main theme of last September’s Thessaloniki International Fair where the US was the “Honoured Country.” – a moniker bestowed upon one of Greece’s major trading partners each year on a rotating basis.

Pyatt noted that he had visited Thessaloniki more than any other US Ambassador posted here and said his business contacts believed the Prespes Agreement with Northern Macedonia would remove existing artificial trade barriers and unlock the region’s full potential.

One will likely never hear a presentation by any US Embassy official that doesn’t stress Greece’s emerging role as a regional energy hub.  Leading the charge, Pyatt made it clear he saw most of the work towards that goal as complete already, especially as the Trans-Adriatic Pipeline pipeline across Northern Greece nears completion and the planning for the Greece-Bulgaria Interconnector proceeds.   Greece’s strategic role in various projects to facilitate European energy independence from Russia’s Gazprom should not be underestimated, and it is especially important to highlight the role Greece will play in securing freedom of choice in energy suppliers for the countries in Southeastern Europe, currently locked into purchasing from Russia.

Important new developments, both geopolitical and practical, had led to a renewed focus by Washington on energy development and security in the Eastern Mediterranean. Washington was impressed with the progress made in trilateral Greece-Cyprus-Israel energy development and was eager to participate as a partner where possible.  If logistical arrangements allow it, Secretary of State Mike Pompeo is hoping to attend the next trilateral meeting, to be hosted by Israel later this month.

Pyatt noted that the market will decide on the viability of the potential EastMed pipeline project to Europe, but Washington is watching enthusiastically as regional cooperation on this project increases. Major gas discoveries announced February 28 by ExxonMobil near the Glaucus-1 well off Cyprus clearly impact the market positively but need to be studied in more detail before they can be fully factored into this equation, Pyatt explained.

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