Konstantinos Kyranakis is the President of the Youth of the European People’s Party (YEPP). Freelance communication strategist and law graduate, his previous experience include advisor and speech writer to Greek Minister of Interior, researcher for Nea Demokratia’s Political Planning department and International Secretary of ONNED (Youth Organization of Nea Demokratia’s Party). He devotes most of his time to youth politics, electoral campaigns and raising political awareness.
In between flights, he has kindly welcomed us to the EPP headquarters in Brussels and answer to a few questions, shedding light on his projects as President of the YEPP and his view on the way ahead for European youth entrepreneurship before the European elections in May 20_25.
Alice Pappas is editor Europe for Perspectives Internationales.
Alice Pappas: Konstantine, you are one of the youngest Presidents of the YEPP and active member of ONNED. What are the main challenges of your mandate?
Konstantinos Kyranakis: I was elected 6 months ago, in May 2013, as the youngest elected president of YEPP, the largest political youth organization in Europe, founded by Fredrik Reinfeldt in 1997, who is now Prime Minister of Sweden. My mandate will last for 2 years, and my mission as leader of this organization is to multiply the message of every of our national youth organization to the European agenda, in other words, we take the best ideas that our 1 million members have to offer and try to turn them into European policy and try to influence the European agenda, the European Parliament. We try to change EU law and then go after the implementation in every country where the youth issues are at stake.
A.P: You have been referring several times to a project that would revive entrepreneurship among young Europeans. What are the key guidelines and main steps?
K.K: Well it is a simple plan. It’s based on common sense and on today’s needs of the market. There are basic problems that are not addressed, like youth policies. We don’t think that the solution to youth unemployment is just to throw money on it. For the last few years we’ve seen the EU Institutions advocating for the youth guarantee which in our opinion is a social policy and not an employment policy and the 8 billion paid by tax-payers money are just going to be thrown on the problem and the result of this whole policy will unfortunately be unsuccessful.
The three steps of the plan are:
First, we need to link tax-incentives to job creation. What we propose for the countries where this mostly applies; for every company that hires someone who was previously registered as unemployed and under 30, the company would get a tax break in the end of the year that would equal the amount of the unemployment benefits this person would receive for the same year. So, in other words, it’s a win-win situation. The State would stop paying for this unemployment benefits, increasing its revenues, and the person hired in return, would have a job, pay VAT, start consuming more, pay income tax in the end of the year… and if the measure is successful, the company would get also a tax break which reducing dramatically the costs of employment for this person. Unfortunately the cost of employment right now in Europe is very high, as is taxation; we did some research that shows that if on average a 2.3% tax reduction on the corporate tax across Europe would be implemented then the EU based companies would afford to hire 2 million people. This number is calculated on the average wage not the minimum wage, so we are talking about huge numbers here. The same could be applied to social contributions. Therefore, a tax break or a tax incentive for job creation can in the long term boost employment, and increase drastically State revenues. This is also something that we have seen with a research team in New York University (NYU); base on the model that in countries in recovery, the increases in number of work force increases even more the revenues. So, this is step number one.
The second step is skills. Everyone talks about vocational training, life-long learning and the importance of training for employees and so on. But nobody sees that the real problem, which is being constantly repeated, is that we have graduates every year who graduate without a working experience. There is a system that is very successful in Germany, Austria, which are the countries with the lowest level of unemployment rates in Europe right now, called the dual system. It consists in integrating working experience inside the diploma of higher education, saving time and getting rid of the argument of every employer that you don’t have enough working experience. In a changing world where we don’t have time to lose this is not a problem that we should aim to solve in the long term, rather we should tackle it immediately, millions of people and jobs being lost every year. Today we have more than 2 million vacancies across Europe. In Greece, the country with the highest youth unemployment rate in Europe there was a decade record high of job vacancies last month (dec, 2013). The McKinsey report published early January says that more than 50% of the EU companies are not able to find the right candidate and this is because they are not qualified enough. We are the generation with the best education in the world but our education do not comply with job market needs, and this needs to change now if we want the next graduates to be able to catch up.
The third step has to do with bureaucracy. We advocate for zero bureaucracy for entrepreneurs. The amount of bureaucracy, private or public that a small business has to go through every day from the moment its founders are starting it up to going through the monthly procedures, is gigantic, in particular in Southern countries. Small medium enterprises (SMEs) represent 99% of EU companies, 9 out of 10 are composed of 10 people or less, and they provide two thirds of the private sector jobs today in Europe. There are 25million people unemployed today in Europe. The link between the two dynamics is quite evident. An average company spends 3-5 working days every month on bureaucracy. It is not only hard to start up a company in these countries, something that is done online in Estonia, but you also spend a lot of time sustaining the organization. The solution is either to outsource the bureaucratic work or hire someone to deal with the bureaucracy, filling call for proposals, EU grants. It is a problem that the EU proposes so many grants for projects and it is so difficult to apply.
So what we suggest is on the one hand that we need to promote as much as possible from the private sector side, the model of clusters, which is very successful in the US. For example, Commissioner Nelly Kroes has launched a fantastic cooperation with the founders of the best European start-ups, called “Start-up Manifesto”. They have delivered a study that shows that the internet based companies will grow exponentially in the next 5 years. This sector can create a lot of jobs and the model of clusters works. On the public sector side, we need to implement the “one-stop shop” policy, which is often only on paper. This policy is not only about funding a company but it implements a policy of the one agency that deals with all the monthly bureaucracy. It would be extremely useful for SMEs to spend just one day their working month to go at this agency and deal with everything that they cannot do electronically. So these are the two ideas that we need to promote to kill bureaucracy as much as we can and on the other hand we should develop electronic governance. Bureaucracy will be maintained if we have people sitting behind desks doing things that could be done by a website. We have the technology but it still doesn’t happen because of the size of the public sector.
A.P: What about the viability of the project, how can you bring this project to the European Institutions?
K.K: We’ve been quite successful actually. On the level of the EU Institutions the EP has adopted those 3 proposals in different reports; check for example the Youth report that was adopted in September, the EPP Ministerial meeting of employment is also openly supporting it which means that all these ministers have strong public support for the project and that they are most likely to implement it in their countries. The former employment minister of Germany has supported it too and, with the help of our network we have strong support from European Commissioners. We met with President of the EC Mr. Barroso and actually the priorities that we presented to Mr. Barroso figured in the conclusions of the EU Council.
A.P: Does that mean that it can be implemented soon? Is it already implemented in some EU Member States?
K.K: This means that we have a European tool to add pressure on our governments. However, the conclusions of an EU Council, even if it is the most powerful Institutional tool that we have in our hands, doesn’t mean much if the national ministries and governments and parliaments don’t vote it. So we have results in Ireland for example; Ireland has implemented very similar measures, and as you know, it is creating jobs now at the rate of 1200 jobs per week. They had the highest job creation rate until Portugal took over. Portugal’s government has also been among the first to endorse this plan, and implemented the first step in terms of social contribution. As a matter of fact, we can see that Portugal is decreasing its unemployment at a rate of 1% every semester. In Sweden they also implemented the same proposal but for people younger than 23 years old, and the measure seem to be working there too. The legislative procedure has started also in countries like Greece where 11 young MPs of our network there made an official parliamentary question to the employment and finance minister, saying that these were the proposals of the YEPP adopted by the Council, and we are going to push Mr. Stournaras as much as we can in the coming month. The same is happening in Slovenia, Romania and Belgium. It is not the easiest thing to change a law especially with countries functioning with a troika where a large amount of policies are introduced by third parties, but we will persevere because we believe it is common sense package of measures that can work in the short term and have benefits on the long term.
A.P: So what would be your advice for young entrepreneurs from Greece, Spain, Italy or Portugal?
K.K: My advice to entrepreneurs would be not to give up, Europe has an immense potential of creativity. You see a lot of ideas being born in Europe but because of the problems that we are trying to solve with this 3 steps- plan, they are moving their products or their base or production in other parts of the world. An example; there’s a very cool Swedish photo-camera I found online some months ago, the first social camera. I wanted to buy that product. I asked the brand if I could buy them the camera during one of my trips to Sweden. Well it was impossible since they had had to transfer their base in Honk Kong, with their shipping taking place through California. Why? Because it is cheaper and easier. It is easier for entrepreneurs to be productive and increase their revenues by operating outside Europe, even though they are Europeans. Big ideas, big businesses like Skype are sold out to Microsoft. I don’t think it is a bad thing as such but I believe in a Europe that uses its potential in a much better way. So what I would advise them is to join initiatives like the Startup Manifesto that the European Commission has started – European politicians have proven that they can be open to listen to entrepreneurs that have ideas. The solutions will come, I think the crisis has shown that apart from the problems, and the big sacrifices of the people, have also forced the governments to adopt common sense solutions, so we remain optimistic and do everything that we can to push these political reforms that seem to be working fine in the countries that implement them and we keep on standing for a strong voice of the entrepreneurs in Europe.
A.P: With European elections coming up in May, what do you do as a youth organization to motivate young people to vote?
K.K: Well actually a recent study has shown that two thirds of young people will go to vote in the next European elections. The problem is that it will most likely be a protest vote.
A.P: Precisely. How do you convince or how do you win the confidence of young people in countries like Greece, where the two major left-wing and right-wing parties have been widely criticized by public opinion as being also responsible for the current situation?
K.K: It is hard. And it was also hard to do all those reforms needed in our countries. We were the bad guys, and have been seen as the bad guys everywhere in Europe. And the countries which are doing fine are actually perceived as the bad guys by the countries which are not doing fine. So we have, this is a decision that we took a while ago, when we decided that the EPP would be a responsible party that would be the political force that would not care so much about the political cost and we are going to do everything needed to put things in order especially with the crisis, when it is crucial to our economies. Now what we do is showing tangible results that the sacrifices of people have brought. We are thankful of reaching a point were Ireland exit the bailout successfully, that Portugal is following the same path, Greece announced for the first time since the beginning of the crisis a primary surplus, which doesn’t mean anything for the pockets of their citizens right now but it is actually what will let us get out of the troika, the bailout agreement, stop the austerity measures, and guaranty the credibility of the country in the markets, which will basically allow the economy breath again. So, there is a big number of tangible results in our economies from the financial perspective at this point, it good and bad. Good because the economy as a whole is able to perform and in the short term, results will come out of this in the private income of families but it is also bad because if political parties or governments advocate that everything is fine, this is not felt from the citizens themselves and creates even more rage, lack of confidence and trust. Our role therefore is to communicate this better, to convince the citizens and especially our members that their sacrifices are worth their while. Even though this is hard, we are do so through trying to convince the leaders of our national youth organisations who are also hard to convince. If they are convinced then this means that we have a more ground to convince our members and by all this network of multipliers, more citizens will realize that it was the only way to go and that despite the sacrifices, results come out in the near future. Recovery is the key word that we are using, and recovery is not easy to achieve or to communicate.
A.P: A final question before you leave, how to deal with the rise of extremisms and populist speeches when there are so many unpopular measures to take?
K.K: A word about populism: I would like to bring the example of Nigel Farage, leader of the Ukip (UK Independence party) and one of the most famous EU politicians at this point. I would like to ask all his supporters or the people following his – changing – views; what solutions has he brought for the British and the European citizens? Especially when the tax payers are paying since 1999 to sit in the European Parliament while he never shows up? The answer is that he has never brought any solutions to the European citizens. At the end of the day, voters are also responsible. Political parties and governments are responsible, but voters have a responsibility to see who is actually providing solutions to their problems. Because in the end, we live in a democracy, which by the way gives the right to Nigel Farage to be anti-european, but it is the responsibility of the voters to choose whom they want to lead their way out of the crisis.
More information on:
-European Elections 2014:
-Start up Manifesto: http://europa.eu/rapid/press-release_IP-14-66_en.htm
 Nea Demokratia or New Democracy is the main centre-right political party and one of the major parties in Greece. His leader, Antonis Samaras is currently Greece Prime Minister.