Head of FX Strategy at BoA Merrill Lynch, Athanasios Vamvakidis shares his views with us
We met Mr Thanasis Vamvakidis at the Bank of America Merrill Lynch head office in the City of London. As Head of FX Strategy for a major global banking institution and a spokesperson for BBC and Bloomberg, his opinion on both the Brexit and Hellenic crises holds considerable weight.
The Hellenic Crisis – The Post Memorandum Era
Regarding the Hellenic crisis and the exit from the Memorandum Agreement, Mr Vamvakidis highlighted the importance of this first step, since it was an extremely difficult eight-year period for the country, and emphasised that the major advantage is that the deal on the public debt, though still huge, allows Greece to postpone the problem until 2032.
Mr Vamvakidis highlighted that the severity of the crisis in Greece was due to the lack of political will to implement necessary key reforms, which consequently forced the country into a brutal fiscal consolidation, plus the failure to use the crisis as an incentive to implement reforms that would boost the economy and prevent the crisis happening in the first place.
He outlined the absolute necessity to implement the reforms as soon as possible in order to transform Greece into a modern economy that will run with growth rates constantly above 2%. Only with these growth rates will the economy accelerate, and the debt become sustainable. If Greece is not capable of achieving these growth rates and instead remains at roughly 1%, then the debt sustainability problem is something that we will be faced with again very soon.

When asked about the differences in the economic crisis between Greece and other European countries in the region, Mr Vamvakidis agreed that the crisis in Greece was far more severe, however he pointed out that Italy, Spain and Ireland were much more effective in implementing the necessary reforms and there was also a much better overall political agreement in order to create a “crisis-exit” plan.
Investing in Greece – Accelerating the Economy
On talking about investments, Mr Vamvakidis highlighted that the most important factor is private sector investments, since growth cannot be achieved by the public sector, which is facing a restructuring process, nor from consumer behaviour or salaries that has already collapsed in Greece because of the crisis.
This will be achieved by implementing basic reforms that will improve public administration in Greece (e.g. reduce red tape, open closed professions, complete the land registry) and also enhance the privatisation programme and adjust the fiscal policy to become more investment friendly. Greece’s target should be to improve the already improved sectors (e.g. Tourism) but also develop other sectors that can prosper such as export oriented sectors.
Mr Vamvakidis shared with us his optimistic view for the future. His belief is that the history of Greece is full of examples whereby following a disaster we managed to bounce back and prosper. We all hope he proves right.
Brexit and the day after
We also asked Mr Vamvakidis to give his view on Brexit since it is an issue he faces on a daily basis in his job, and the potential problems that Bank of America Merrill Lynch could experience as a result. The main word he used to describe Brexit is “uncertainty” and pointed out that this is an example of how everything can go wrong in a country.
Pro-Brexit leaders did not have a concrete plan of what Britain would gain from Brexit which is why we still don’t have a solid proposal from the UK Government and a post Brexit plan for the UK economy. A very solid example of that is the border issue with Northern Ireland, which would have to be accepted by the UK in the event of a hard Brexit.
Mr Vamvakidis believes that in the immediate future there will be a compromise between the UK and the European Union in order to avoid a disastrous no-deal Brexit. On the positive side, not all details have to be agreed upon now as the regime can be finalised after the 2-year transition period
It was an extremely interesting conversation with Mr Vamvakidis, and we hope to be able to have the benefit of his expert views on current economic issues.
Special Thanks: Mr Athanasios Vamvakidis
Bank of America Merrill Lynch
Aesopia Media Productions
Thanasis Chavales