The governor of the Bank of Greece (BoG) Yannis Stournaras highlighted the decisive role of Athens in the Greek economy, as well as the challenges created by the strong concentration of economic activity in the capital.
Speaking at the conference “Dialogues for Athens,” organized by the newspaper “To Vima,” on the topic “Athens’ contribution to Greece’s economy”, Mr. Stournaras presented Athens as the country’s most important economic hub, linking its current dynamism with enduring characteristics of its economic development.
According to the data he presented, Attica produces almost half of the national wealth in terms of Gross Value Added, accounts for about one third of gross national fixed capital investment, and nearly 40% of total employment.
At the same time, Athens’ strong tourism and investment momentum strengthens its economic position, but increases pressures on housing, transport, and infrastructure.
The governor of the BoG stressed that addressing these challenges requires a new cycle of productive investments in infrastructure, housing, digital and energy infrastructure, as well as greater emphasis on productivity, innovation, and high value-added activities.
At the same time, he highlighted the need for Athens’ dynamism to spread to the rest of the country, so that the capital functions not only as an economic hub, but also as a lever for the broader productive upgrading of the Greek economy.
The full speech by Yannis Stournaras follows:
“In many countries, the capital is something more than an administrative center: it is a key pillar of economic, business, and cultural life. Athens is a characteristic example, combining a unique historical and cultural heritage with the role of the country’s most important metropolitan center.
In my speech I will first refer to the role of ancient Athens and the institutions that contributed to its economic flourishing, then to the contribution of modern Athens to the Greek economy and, finally, to the challenges it faces today and the policies that can strengthen its developmental role for the benefit of the whole country.
Ancient Athens
Ancient Athens has valuable timely lessons to offer us not only in the field of political organization, but also in the field of the economy. The modern institutional approach, the so-called New Institutional Economics, treats the ancient Greek economy as a success story, as archaeological data testify to a significant rise in population and living standards from the Archaic to the Hellenistic period.
By the standards of pre-industrial societies, the Greek cities were relatively egalitarian societies and were characterized by material prosperity.
Success was based on innovation, competition among the city-states, and the very rapid diffusion of successful innovations throughout the Greek world. Today, of course, when we speak of innovation, we mainly mean the introduction of new technologies. In antiquity, however, technological progress was limited and innovation mainly concerned the introduction of institutions.
A basic prerequisite of a healthy institutional framework for the economy is the equal application of rules, the so-called rule egalitarianism, something that characterized the societies of the Greek cities, both democratic and oligarchic.
The equal application of rules supported economic development by providing incentives for investment and reducing transaction costs. In this context, the Greek cities developed institutions for the protection of property rights, respect for contracts, and dispute resolution procedures.
In its economic policy Athens followed already existing practices, but also others that constitute Athenian innovation. The first basic principle was specialization and the exploitation of competitive advantages.
The supreme concern of the Greek cities was to feed their populations, and the basic food commodity of the time was grain. Here Athens was at a disadvantage, as the land of Attica is not particularly productive and Athens constantly faced insufficiency of grain combined with a continuous increase in its population.
For this reason, the Athenians turned early on to the production and export of products with a competitive advantage, such as honey, olive oil, and Athenian pottery, while for the supply of grain they turned to imports, mainly from the region of the Black Sea.
The Piraeus developed into a port bustling with commercial activity, attracting merchants from all over the Mediterranean. But trade also needs financing, and this was provided by Athenian banks in the form of maritime loans, since trade was conducted mainly by sea.
Commercial transactions also require legal certainty, and this was provided by the Athenian state by establishing the so-called maritime or commercial trials, which were carried out through swift procedures, so that foreign merchants would not be trapped in Athens in time-consuming legal disputes.
Although Athens was not the first Greek city to adopt currency, by exploiting the silver mines of Laurium it issued the Attic drachma, the famous owls, which prevailed as an international currency in the ancient Greek world and the Mediterranean for two consecutive centuries.
The Athenians had also understood the importance of monetary sovereignty as a prerequisite for their political and commercial power. A characteristic example is Athens’ attempt in the 5th century BC to impose the Attic drachma as legal tender in the cities of the Athenian alliance.
Through monetary sovereignty, Athens proclaimed its hegemonic power and increased its revenues from the issuing privilege. Also, Athens is probably the first city to have established a public bank, which managed the city’s available funds, collected public revenues, and paid public expenditures.
If, therefore, we wanted to summarize the basic principles of the Athenian economy, which also make up Athens’ contribution to the ancient Greek economy, we would point out innovation, specialization and the exploitation of competitive advantages, outward orientation and emphasis on tradable goods, the protection of property rights and legal certainty, the smooth financing of the economy, the creation of strong institutions of economic governance, and the strength and credibility of the currency.
Today’s Athens, a modern metropolitan center
Athens, as the core of the country’s largest metropolitan area, is today the most important economic hub of the Greek economy. The strength of the capital’s economic activity is reflected primarily in the regional footprint of Attica.
According to the most recent Regional Accounts of the Hellenic Statistical Authority (ELSTAT), Attica produces almost half of the national wealth in terms of Gross Value Added, has the highest GDP per capita, almost 30 thousand euros, while the average for the whole country is 21 thousand euros, and accounts for about one third of gross national fixed capital investment.
At the same time, employment in Attica corresponds to almost 40% of the country’s total employment. These are performances that demonstrate how decisive metropolitan Athens’ contribution is to the Greek economy, while at the same time underlining the strongly centralized character of the country’s economic structure.
Athens’ economy is characterized by a high concentration of tertiary-sector activities. Trade, transport, storage, food service and accommodation, real estate management, financial activities, and services to businesses and households make up a large part of its productive base.
This concentration creates economies of scale and networking: businesses, workers, universities, financial institutions, and new investments interact in a common economic space, facilitating the diffusion of knowledge and the development of new activities.
Particularly important contributions to Athens’ positive performance come from tourism and culture. Athens has developed into an autonomous international tourist destination, leveraging the great comparative advantage offered by its historical and cultural heritage and its global recognizability.
In 2025 Attica was the region with the highest visitor traffic in Greece. Travel receipts were up by 125.3% compared with 2019 and visits by 63.8%. As a result, Attica’s share in the country’s total travel receipts increased from 14.7% in 2019 to 25.8% in 2025, while the corresponding share in visits widened from 16.2% to 23.2%.
This momentum is linked to the growing attractiveness of Athens as an urban tourism destination, but also to the significant upgrading of tourism infrastructure.
At the same time, it has significant multiplier effects on the economy and employment, supporting a broad ecosystem of businesses in the hotel market, food service, trade, transport, culture, and the real estate market.
However, the same momentum that strengthens Athens’ economic importance also creates the characteristic pressures of a large metropolitan center. The concentration of population, businesses, investments, and millions of visitors increases demand for housing, transport, energy, public space, and basic infrastructure.
In other words, some of Athens’ greatest current challenges are, to a degree, also a consequence of its very own economic success.
A characteristic example is the real estate market. Athens is at the center of a new investment cycle, with significant capital inflows and increased demand for housing and commercial property, as reflected in the continuous upward course of prices.
In 2025 apartment prices in Athens increased on average by 6.6%, while in the second quarter of 2026 the annual increase stood at 5%. This development reflects the city’s economic and investment momentum, but at the same time intensifies the problem of affordable housing, especially for young people and households with lower or middle incomes.
And here the economic dimension is broader. When housing costs rise faster than incomes, the problem is not only social.
It limits labor mobility, makes it harder for businesses to attract and retain workers, and increases the cost of living in a city that aspires to attract human capital and businesses with high value added. Similar phenomena are observed in many cities in the US and Europe today.
Similarly, the traffic problem is perhaps the most characteristic example of the economic cost that metropolitan congestion can create.
The time lost daily in commuting is not merely an inconvenience for citizens. It reduces available productive hours, inflates the cost of transporting workers and goods, burdens businesses, increases energy consumption and air pollution and, ultimately, limits productivity and degrades the city’s attractiveness.
For this reason, maintaining Athens’ development momentum presupposes a new cycle of investment in metropolitan infrastructure, aimed at addressing environmental pressures and the urban needs of residents. In this direction operate the extension and upgrading of the metro, the more effective utilization of the suburban railway, and the strengthening of public transport more generally.
At the same time, investments are required in digital and energy infrastructure, water supply and waste management networks, flood protection works, and the strengthening of urban greenery. Climate change makes some of these investments even more urgent. Policy measures to increase the supply of housing must also be a key element.
These investments should not be treated merely as interventions to improve everyday life. They are productive investments. They reduce the city’s operating costs, facilitate labor mobility, strengthen resilience, increase productivity, and improve Athens’ ability to attract businesses, investments, and human capital.
Infrastructure, therefore, should not simply follow the city’s growth; it must be planned in time so as to support and guide it.
The overall picture is undoubtedly dynamic, but it should not create complacency. Athens has many of the basic characteristics of a modern European metropolitan center: human resources, international connectivity, tourism recognition, business activity, universities and research institutions, financial services, and growing investment interest.
The next step is the transition from growth based largely on the concentration of activities in tourism and real estate to an even more productive and innovative metropolitan model, with greater emphasis on technology, the green and digital transition, infrastructure, and high value-added activities.
And this matters not only for Athens itself. When a metropolitan area produces almost half of the country’s Gross Value Added, its productivity, infrastructure, and competitiveness are a national economic issue.
The high concentration of economic activity in Attica creates significant agglomeration economies, but it also entails the risk of widening regional inequalities if the benefits of growth remain geographically concentrated.
The challenge, therefore, is twofold: Athens must continue to function as an engine of growth, investment, and outward orientation and, at the same time, the mechanisms through which this momentum is transmitted to the rest of the country must be strengthened.
This can be achieved through stronger interregional value chains and greater demand for products and services produced in the regions.
Also, through the diffusion of technology and knowledge from Athens’ universities, research centers, and businesses, but also through regional businesses’ access to financing, specialized services, and international markets. A critical prerequisite is better physical and digital interconnection of Athens with the other regions, so that metropolitan concentration functions as a source of positive spillovers and not as a factor of further economic divergence.
From Athens’ challenges to the challenges of the Greek economy
Athens’ challenges do not concern only the capital. To a significant extent they reflect the broader challenges of the Greek economy. For Greece, the objective today is not only the preservation of macroeconomic stability, but above all the safeguarding of sustainable long-term growth and real convergence with the more advanced European economies.
To achieve this, what is required above all is strengthening productivity. We need more, but above all higher-quality investments in innovation, digital and green technologies, infrastructure, energy, and outward-looking high value-added activities.
We need better links between universities, research, and production, upgrading of skills, and attraction of human capital. At the same time, we need more effective institutions: faster justice, simpler procedures, strengthening of competition, and a stable and predictable business environment.
Athens can function as an accelerator of productive transformation. It concentrates human capital, universities, research centers, business and financial services, and a significant part of the innovation ecosystem. The objective, however, is not a strong Athens and a weaker periphery. It is a more productive and internationally competitive Athens, better connected with a more productive and outward-looking Greece.
And here there is an interesting continuity with ancient Athens. The eras and comparative advantages have changed, but certain prerequisites of economic success remain the same: effective institutions, trust, investments, knowledge, outward orientation, and adaptability.
Ancient Athens flourished because it managed to combine institutions and infrastructure with trade, knowledge, and the attraction of people and ideas from a much broader geographical area. Likewise, modern Athens can leverage the concentration of human capital, businesses, universities, and investments, not only for its own development, but as a lever for the productive upgrading and greater outward orientation of the entire Greek economy.
This may be Athens’ most substantial contribution to the Greece of the future.
Thank you”.