Jutting into the Adriatic Sea is a highly coveted spit of land that houses the Astir Palace Resort. The Astir has played host to the likes of Jackie Kennedy Onassis, Jane Fonda and Nelson Mandela for well over half a century. The property is a gem, and now is not a good time to sell. But that is what the Greek government, as a partial owner, is about to do as part of the EU-IMF bailout package. They won’t raise much. There has to be a better way than this, and there is.
The Club Med countries have an endless supply of prime assets sitting idle, virtually all of which could be rented out in short order. They are vastly more valuable than Astir and will benefit the social fabric.
They are the 90% of the more than 12 million Club Med unemployed youth. Putting them to work would generate $38 billion in annual government revenues, not to mention the $380 billion of extra economic stimulus when the newly employed flex their purchasing power. Not exactly chump change.
The answer to getting them gainfully employed lies in creating special economic zones in the blighted hinterlands of Greece, Spain and Italy.
Call it the Shenzhen Way, a trail first blazed three decades ago by China‘s great economic reformer, Deng Xiaoping. Special economic zones like Shenzhen were the dynamos that started the now unstoppable Chinese economic renaissance.
Consider the case of the 137-year-old Pallini liquors based in Rome. Brands like Pallini’s Limoncello and Sambuca sit on bar shelves worldwide, and the company recently explored doubling production through a joint venture. “But we didn’t pursue it,” CEO Micaela Pallini told the New York Times. “If the venture failed, Italian laws make it almost impossible to cut our workforce to adjust costs.” It was a risk Pallini could not afford to take.