Wednesday 12 May 2010

The EUR 83 mln Greek Submarine Mystery

Skaramangas Banner at the May 5th Demonstrations in Athens

One of the great, unspoken mysteries surrounding corruption scandals in Greece today is that of the EUR 83 million bribe allegedly paid by the Howaldtswerke-Deutsche Werft (HDW) signed an agreement with the Greek government for the construction of 4 submarines at Skaramanga in 2002.

Since April 2010, Kathimerini has been running a series of articles in which it claims that, according to sources at the prosecutor’s office in Munich, the total amount paid by HDW (later purchased by Ferrostaal, a division of ThyssenKrupp) was EUR 83 million for the four submarines.

This investigation has been widely reported in Germany, not least by Der Spiegel and other sources. But no official conclusions or legal actions have been filed yet.

The Greek government has until recently refused to take delivery of the four submarines, since the first one, the Papanikolaou, listed heavily during sea trials. The incoming Prime Minister, George Papandreou, recently reversed this decision, and has agreed not only to pay the EUR 1.8 bln for the previous four submarines, but even to order two more submarines from ThyssenKrupp at a cost of a further EUR 1 bln.

In a further bizarre twist, the Skaramangas shipyards were recently sold by ThyssenKrupp to Abu Dhabi Mar. Kerin Hope of the Financial Times reports, incredibly enough, that

Nikos Papandreou, the prime minister’s brother, was called in to help with the Abu Dhabi deal because of “the urgency of the situation”, according to defence ministry officials.

I’m extremely reassured to know that the Prime Minister can call upon his brother’s services so freely, circumventing the entire Ministries of Defence, Finance and Economics, or even the Ministry of Foreign Affairs, for urgent situations of this type.

I am doubly reassured by the fact that the Greek taxpayer will probably soon be called to return EUR 230 mln in state aid to Skaramanga, if the European Court decides against Greece (as I somehow suspect it will).

For obvious reasons, I can’t state many conclusions here, since there is still no legal evidence of anything improper. But I believe that anyone reading the articles indexed below can draw their own conclusions without my assistance.

The banner photographed by Stratos Safioleas during the Wednesday May 5th demonstrations in Athens express my sentiments fully. Thanks to him for letting me reproduce it.

Submarine cash revealed

Move to settle submarine spat

Προμήθεια 83 εκατ. για την παραγγελία των υποβρυχίων

How German Companies Bribed Their Way to Greek Deals,1518,693973,00.html

Germany's Ferrostaal Suspected of Organizing Bribes for Other Firms,1518,686513,00.html

Σκαραμαγκάς: οι νέοι ιδιοκτήτες, τα υποβρύχια και οι προμήθειες

Οι Αραβες, τα υποβρύχια και η «προίκα» του Σκαραμαγκά

Τα υποβρύχια βουλιάζουν τον Σκαραμαγκά...

Παραπομπή της Ελλάδας στο Ευρωπαϊκό Δικαστήριο για ενισχύσεις προς Σκαραμαγκά


  1. Very interesting news. I have linked to your article and quoted you on my own blog, since it's primarily about ASW and submarines.

  2. From Kathimerini English edition today, 21.12.2010:

    Ex-official remains tight-lipped
    The former head of military procurements at the Defense Ministry, Evangelos Vasilakos, refused to give MPs further information about comments he made in a radio interview claiming that many of the contracts signed by the Greek state were damaging for taxpayers. “I cannot mention any names or go into greater detail about which contracts damaged the Greek state because I do not have parliamentary immunity,” said Vasilakos. In his interview with Skai Radio some two weeks ago, the former public servant had questioned the multimillion-euro deal for the United Arab Emirates-based Abu Dhabi MAR Group to buy ThyssenKrupp’s majority stake in Hellenic Shipyards, also known as Skaramanga, and the role of Nikos Papandreou, Prime Minister George Papandreou’s brother, in securing the agreement.