1000+1 reasons why investors do not invest in Greece

It isn’t about competitiveness and even lower minimum wages. It isn’t about the constantly changing taxation system and the over taxation. It isn’t about lack of growth-friendly policies, like lower tax rates and fast implementation of structural  -see: labor – reforms.

It is about Mario Draghi, the European Central Bank and the Quantitative Easing.

Or a combination of 1000+1 reasons.

In an article entitled “Fatigued Investors Want Draghi to Buy Greece Before They Do” Bloomberg cites the reasons why investors stay away from Greece.

“As Greek business leaders and government officials presented to investors last week in London a list of reasons why valuations of the country’s assets make them attractive, Danechi’s Duet Asset Management took note. But what he wants to see is for Greece to show it can make good on pledges made to euro-area creditors so it can be included in the European Central Bank President Mario Draghi’s quantitative easing program.

“Valuation is there, but few believe that this government can deliver,” said Danechi, who helps oversee $1.5 billion in emerging-market assets at Duet. “If Greece goes into the QE program then the mood would turn automatically.”

However this is the one side of the coin. There are still several factors that hinder investors from pouring money into Greece.

“Investors are in no rush to pour money into a market where the value of stock and bond holdings has been repeatedly crushed. In dozens of meetings at the annual Athens Stock Exchange roadshow, Greek executives were bombarded with well-worn questions about political risk, delayed reforms, lack of liquidity, excessive corporate taxes and an unfavorable business climate.”

Greek government officials say that investors are skeptical on the reforms, await to see results and expect from the government to proceed with implementation of structural reforms.

Full article with quotes form investors and government officials during the London roadshow here.

So it is not just about Mario Draghi but accepting Greece in QE would certainly give a positive signal, comfort investors and restore confidence to the debt-ridden country – if the latter is possible at all.