“I was heavily disappointed by the country’s sluggish economic development as a result of the financial crisis triggered in 2007. I felt my hard work would go to waste and not be appreciated . . . I was convinced—and still am—that connections matter the most in the Greek society.”
“Nepotism reigns and there’s lack of meritocracy.”
Nefeli Douma grew up in Thessaloniki, where she finished her undergraduate studies in law. At the age of 23, she left Greece to continue with her master’s degree at the Queen Mary University of London. She returned a year later. Before then, she was not thinking of leaving the country permanently. But as soon as she realized that the chances of finding a well-paid job in her area of expertise were slim, she relocated abroad again to seek job opportunities.
Would she ever consider coming back to the country?
“I’d return if that job were somehow part of a foreign corporation, as what really differentiates Greek to foreign firms is, in my view, the lack of transparency, sound structure, and values,” Douma said. “Salary is a significant drive, but not the only one.”
According to recent data, Douma’s case is not unique. A 2016 report from the Bank of Greece found that during the 2008-2013 crisis, 427,000 Greek residents left the country permanently. This emigration phenomenon is not new to Greece or its neighbors; indeed, communities the world over have seen a series of emigration crises in the twenty-first century. But what differentiates today’s situation is the prevalence of highly educated Greeks who have determined that their brains may be best utilized outside of their home country.
The entrepreneurship organization Endeavour estimated that over 250,000 highly educated Greek professionals lived outside of the country in 2017—200,000 of whom left the country after 2010.
So, what is this brain drain phenomenon that Greece is experiencing?
The term “brain drain” first appeared in the 1950s and 1960s after the British Royal Society used the term to describe the outflow of scientists and high-skilled workers who headed to the United States and Canada to seek better job prospects. Today, the definition remains and can be characterized by scholars as the “migration of relatively highly educated individuals from developing to developed countries.”
Throughout the years of the financial crisis, the brain drain issue produced a heated debate in Greece. And even though a major chapter in the Greek financial crisis concluded with the end of the 2018 bailout program, challenges to the Greek economy persist.
Taxes have remained extremely high, and the unemployment rate remains at an undesirable 16.7 percent as of August 2019. The rate of the youth unemployment is even higher, estimated at 22.9 percent in 2018.
Thus, many young professionals continue to leave the country.
Some data does show that a percentage of Greek emigrants have come back. According to the London School of Economics, 1 in 18 families in Greece at the household level had a member who emigrated in the post-2010 period. Of those emigrants, 15 percent had returned to Greece at the time when the survey was conducted.
However, only one-third of the above returnees were incentivized by opportunities in Greece.
In a country still reeling from one of the worst economic episodes of its history, how can opportunities be created, especially for the youth population?
The Promise of Entrepreneurship
Promoting entrepreneurship—creating new jobs and connecting local economies to the global economy—may be the key to connecting youth to better opportunities.
But in order for entrepreneurship to succeed, a whole ecosystem is needed, including networks of enabling environments. Strong connectivity, networking, formal and informal institutions, access to financing, and human capital and knowledge are all parts of the entrepreneurial ecosystem.
In Greece, efforts to support entrepreneurial initiatives have been underway for many years. According to the European Commission, during the last decade, the promotion of entrepreneurship has been a priority for the Greek government. Meanwhile, more than 500 start-ups have been established since 2012.
But Greece’s growing cohort of young entrepreneurs faces challenges that have proven difficult to overcome.
When Dimitris Messinis was founding Mindspace, an organization that educates students about entrepreneurship, he struggled to even secure space to operate at universities.
“We tried with contacting the director, the management, several professors, getting 50 signatures from different professors for two years, and finally, we have now a space inside the National Technical University of Athens, but it took all this hassle and also two general assemblies of professors that barely gave us the okay to have the room,” Messinis said.
Stavros Messinis, co-founder of The Cube Athens, a start-up co-working space, incubator, and accelerator (no relation to Dimitris), describes his experience over years of supporting young entrepreneurs.
“Families would discourage people from taking such huge risks and becoming entrepreneurs because there’s great risks if you fail in the sense that it’s quite hard to recover after a failure,” he said.
Despite these challenges, aspiring Greek entrepreneurs have found support in an unexpected place: foreign embassies. Diplomacy has long enabled countries to collaborate with each other on an official government-to-government level. But public diplomacy focuses on bottom-up collaboration, strengthening and promoting people-to-people ties, and allows a country to spread values and ideas and potentially create the kind of networks that can alter the dynamics of a society.
Diplomacy, then, is a natural match with entrepreneurship, which has a similar focus on collaboration, network building, and creative thinking. Entrepreneurial diplomacy aims to offer opportunities to create sustainable businesses and, as a result, generate new jobs and ways of mitigating economic challenges.
The embassies of several countries, including the United States, have brought entrepreneurial diplomacy to Greece.
As Jennifer Schueler, the cultural attaché of the U.S. embassy in Athens, explained, “we have helped people adopt different ways of seeing entrepreneurship, we have helped people build skills that have given them the tools to succeed.”
In Greece, the U.S. embassy supports many entrepreneurial initiatives that focus on social impact.
Impact Hub Athens, a non-profit organization co-founded by Sophie Lamprou, the 2018 International Visitor Leadership Program Alumni award winner for Social Innovation and Change, hosted the “Hack the Camp” initiative. The event was a trisector collaboration for the refugee crisis in Greece. Other initiatives included the “Codegirls” program—a collaboration between the U.S. embassy and the non-profit Mataora—and the Fulbright Program’s “Building Bridges” exchange program.
The U.S. strategy agenda for Greece includes initiatives that enhance entrepreneurship with a top-down approach and real benefits both for American interests and for local economies.
What Is In It for the United States?
These initiatives serve a number of important goals for the United States and other countries. Seth Center, a senior fellow at the Center for Strategic and International Studies (CSIS) and an expert in diplomatic history, argues that the initiatives allow countries to bypass potentially contentious issues.
“It allows an ambassador and an embassy to build a relationship around a shared interest, which is really not connected to a specific political or strategic agenda,” Center said.
The promotion of open markets, for example, has long been an American ideal that has been promoted by various diplomatic initiatives. The U.S. State Department’s Young Africans Leaders Initiative is one such example.
Center says entrepreneurial diplomacy through collaborations on start-ups could serve as a countermeasure to, for example, China’s economic diplomatic efforts through its Belt and Road Initiative.
“Connected [then] to a longer-term geopolitical competition with China, the appeal of a model of a large-scale acceptance of enormous debt burden from China in exchange for infrastructure projects goes down. The people of Greece [could] see a viable and meaningful economic alternative to that path.”
Recently, Greece’s Minister of Education and Religious Affairs Niki Kerameus announced that she would increase Greece’s contribution to the Fulbright Program. Additionally, after a White House meeting between President Donald Trump and Greek Prime Minister Kyriakos Mitsotakis in January 2020, U.S. Ambassador Geoffrey Pyatt underscored the strength of ties between the two countries.
“It is an excellent period for U.S.-Greek relations,” Pyatt said. “After a decade of economic crisis, Greece has transformed and is a source of solutions, a pillar of stability and a critical partner in America’s broader strategy in the Eastern Mediterranean and beyond.”
U.S. Partnerships with Foreign Governments and Entrepreneurs
Greek entrepreneurs have been able to leverage some of the opportunities that the U.S. embassy has created through mentorship, exchanges, bootcamps, funding, and other initiatives. The embassy works in collaboration with the Greek government, the U.S. private sector, and through partnerships with the U.S. government.
Organizations like the Hellenic Initiative, ReGeneration, and the Libra Group have also connected the Greek-American community with the new entrepreneurial generation in Greece. The Envolve Award Greece was founded in 2012 by the Libra Group, “to inspire and champion established and new entrepreneurs.”
Every year since 2017, the participation of Greek start-ups in the iconic technology, innovation, and entrepreneurship festival South by Southwest (SXSW) in Austin, Texas is another example of a successful U.S. embassy-led initiative in partnership with the Hellenic Initiative. In 2019, the Hellenic Initiative also attracted further support from the Greek Ministry of Digital Policy, Telecommunications and Media, the American-Hellenic Chamber of Commerce, and Industry Disruptors – Game Changers.
“Over the years we’ve sent more than 96 entrepreneurs to go to the U.S. for this festival to increase their connections and see what opportunities are out there for them,” Cultural Attaché Jennifer Schueler added.
In addition to funding, networking, and other concrete resources, entrepreneurs also gain valuable exposure to different ways of doing business. Yiannis Nikolopoulos, co-founder of Clio Muse Tours, has participated in a number of programs with international partners, including traveling to SXSW.
“Perhaps the most important thing was the business ethics that we saw,” Nikolopoulos said. “We were working closely with the embassy staff, and the way they handle their everyday business and the transparency they apply . . . were very valuable lessons for us.”
The U.S. embassy has also worked with the Dutch embassy to organize a series of programs through Orange Grove and IdeaHackers.nl. These initiatives focus on start-up entrepreneurship. Orange Grove was formed to support young entrepreneurs who want to start their own business in Greece. Since its initiation in 2012, the program has sought ways to reduce brain drain and encourage mobility at the same time, and over 170 start-ups have participated in Orange Grove.
The Limitations of Diplomacy
Despite the success of entrepreneurial diplomacy efforts, foreign embassies cannot solve every problem.
Ambassador John Heffern, who served abroad for decades and currently teaches classes on social entrepreneurship and diplomacy at Georgetown University, notes which changes embassies can facilitate, and which they cannot.
“We can’t tell a country how to change its tax laws or how to change its regulations in a way that will help entrepreneurship,” Heffern said. “All we can do is we can identify people that we think will be good for that country, good for our shared values, good for entrepreneurship, good for innovation, good for growth—positive, sustainable growth.”
In spite of these limitations, efforts of foreign partners to spark entrepreneurship in Greece have seen clear successes and even willingness to address brain drain.
But observers still disagree on whether these efforts will bring back young professionals who have left Greece—or if that should even be the goal.
Some people within the growing Greek start-up scene are optimistic that they can slow or even reverse Greece’s brain drain. Stavros Messinis of The Cube Athens is one of those optimists.
“We’re currently seeing a brain gain in the sense that the economy is recovering, and we’re seeing many, many people come back,” Messinis said.
However, others see continued migration as an inevitability, but one that may bring some opportunities.
“What we want to do is stop Greeks leaving the country,” said Alexandra Sarma, the general manager of Orange Grove. “But we know that this is not very realistic, because there’s always mobility.”
The creation of these globe-spanning networks of entrepreneurs is sometimes referred to as “brain mobility.” These networks can also have positive effects on bilateral trade and investment and facilitate the transfer of knowhow and technology to origin countries.
Some young Greek entrepreneurs become transnational entrepreneurs, traveling physically and virtually, struggling to leverage two or more socially embedded environments.
“We also want to bring in other people from abroad to bring in their skills and help us create a very strong startup community . . . a strong ecosystem that brings international knowledge in Greece and opens up potential partnerships abroad,” Sarma added.
This transnational approach may benefit both the entrepreneurs and the Greek economy. Globalized entrepreneurs often feel liberated from geographic constraints and unbound from traditional organizational structures.
Erol Yayboke, a senior fellow at CSIS, acknowledges that entrepreneurs often pursue initiatives abroad but argues that this can create new opportunities for growth.
“What’s incumbent upon all of us is to think about how those countries—the countries that they’ve left—can make it enticing, can make it interesting for those people that have left to not only come back but reinvest and engage and offer opportunities for younger entrepreneurs,” Yayboke said.
Israel is a notable success story of a transnational entrepreneurial ecosystem. In the paper “Start-Up Nation,” Steven Fraiberg documents the Israeli system’s dynamic character, which allows the “circulation of actors, ideologies, texts and objects” creating “a mobility systems framework.”
The emerging Greek ecosystem could embrace a similar transnational model and benefit from the mobility that has resulted from Greece’s financial crisis.
Creating and sustaining these global networks is one of the most important roles that embassies can play in fostering entrepreneurship, according to Yayboke.
“It’s through embassies and through partnerships with places like the [U.S.] State Department that connections can be made and the opportunities for exchange happen.”
In order to fully succeed, these initiatives will need to be accompanied by reforms to improve the enabling environment that only the Greek government can undertake. Universities like the London School of Economics have worked to lay out a roadmap.
Recent efforts by the Greek government, such as the “Rebrain Greece” and the “Knowledge Bridges” initiatives, might help to reveal whether this is a feasible strategy for Greece.