Greece: A Modern Semi-Colony

The Contradictory Development of Greek Capitalism, Its Failed Attempts to Become a Minor Imperialist Power,

and Its Present Situation as an Advanced Semi-Colonial Country with Some Specific Features

By Michael Pröbsting, Revolutionary Communist International Tendency (RCIT), November 2015,

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List of Tables

List of Figures

List of Maps




I. Some Theoretical Considerations

I.1 What are the Respective Characteristics of an Imperialist vs. a Semi-Colonial State?

I.2 Is a Transition from Being One Type of State to Another Possible?

I.3 Is the Category of “Sub-Imperialism” Useful?


II. Brief Historical Overview of the Development of Greek Capitalism

II.1 The Emergence of the Greek Bourgeoisie under the Ottoman Empire and the Struggle for National Independence

II.2 Greece after the War of Independence (1821-29) until 1922

II.3 Excurse: Greek Chauvinism and the Macedonian Question

II.4 Greece as a Backward Capitalist Country between the Two World Wars

II.5 The Contradictory Process of Modernization after the End of the Civil War until the Accession to the EU

II.6 Excurse: the Greek Shipowners – A Semi-Diasporic Bourgeoisie


III. Greece’s Failed Attempt to Become a Minor Imperialist Power

III.1 Accession to the EU and the 1980s

III.2 Capitalist Restoration in the Balkans after 1989 and Greek Capital’s Expansion

III.3 Rising Migration after 1989

III.4 Failure to Overcome Backwardness and Increasing Indebtedness to Imperialist Powers

III.5 Excurse: Nicos Poulantzas’ Analysis of the Greek Bourgeoisie as Justification of the Popular Front Strategy


IV. The Historic Crisis of Greek Capitalism from 2008 until Today

IV.1 Destruction of Greek Economy by the Imperialist Monopolies and Great Powers

IV.2 Explosion of Debt and the Greece’s Near Total Dependency of the Imperialist Powers

IV.3 The EU-Troika: Greece as a De-Facto Colony of EU-Imperialism

IV.4 Excurse: The KKE and the Class Character of Greece


V. Programmatic Conclusions

V.1 The Tactical Slogan of Greece’s Exit from the EU

V.2 The Program for Complete Equality for Migrants

V.3 The Struggle against Greek Chauvinism: The Macedonian Question


VI. Summary Theses




About the Author


List of Tables:

Table 1: Ethnic Composition of Business in the Ottoman Empire by Percent (1912)

Table 2: Relative GDP per capita (column A) and relative levels of industrialization (column B) in 1913

Table 3: Main Headquarters of Greek-Owned Shipping Firms, 1914–90 (percentage of ship tonnage)

Table 4: Greece’s Economy Compared with the EU-12, 1981-1990 (Annual Averages)

Table 5: Greece: Wages for Various Categories of Workers as Reported by Farmers

Table 6: GDP Per Capita (1990 international $)

Table 7: GDP Per Capita Growth Rates (Percents)

Table 8: Gross Domestic Product at Current Market Prices per Capita of Population in 2013

Table 9: Structure of Gross Fixed Capital Formation in Greece, 2000-2007 (in %)

Table 10: Illicit Financial Outflows of Greece (€ Billion)

Table 11: Greece: FDI Flows as a Percentage of Gross Fixed Capital Formation, 1990-2012

Table 12: Evolution of Small and Medium Enterprises (SMEs) number in Greece, 2006-2013


List of Figures:

Figure 1: Growth of Top Fleets, 1949–93

Figure 2: Greek-Owned Shipping Fleet under Greek and Non-Greek Flags, 1972-2000 (in gross tonnage [millions])

Figure 3: Greek-owned Shipping Fleet under Greek and non-Greek flags, 1996-2006

Figure 4: Bank Loan Portfolio to Greek Shipping 2001-05

Figure 5: Greece: Rate of Surplus Value (RSV), Organic Composition of Capital (OCC) and Rate of Profit (r) in 1958-1977

Figure 6: FDI stock, 1990, 1995 and 2000 (Billions of dollars)

Figure 7: FDI stock as a Percentage of Gross Domestic Product, 1990-2000

Figure 8: Banking Sector Exposure to Central and South Eastern Europe

Figure 9: Workers’ Remittances as a Percentage of GDP

Figure 10: Immigration and Expatriation Rates of Doctors

Figure 11: Greece’s Standard of Living Relative to the European Union

Figure 12: Labor Share in Business-Sector Value-Added, 1964-1995

Figure 13: Breakdown of Employment by Country and Company size (Total private sector employment in %)

Figure 14: Investment in Knowledge-Based Capital and Employment Allocation in the Manufacturing Sector in Greece, International Comparison, 2009

Figure 15: Technological Capital

Figure 16: Foreign Direct Investment in Greece, International Comparison 2009 and 2012

Figure 17: Capital Flight from Greece, 2010-2014

Figure 18 Gross External Debt by Sector in 2003 and 2010 (as percent of GDP)

Figure 19: Economy and Debt of Greece

Figure 20: Debt servicing ratios: Net Interest Payments as a Percentage of Current Receipts (Excluding Interest Receipts), 2005

Figure 21: Saving and Investment Rate in Greece 1995 (Q1) to 2008 (Q4)

Figure 22: Share of Banking Sector Assets, 2000 and 2008 (in%)

Figure 23: Greek and other OECD Net Foreign Assets

Figure 24: Current Account Balance (in % GDP)

Figure 25: Greece: Decline of GDP during the Great Recession, 2007-2015

Figure 26: Greece: Net Return on Capital, 1999-2015

Figure 27: Greece: Rate of Profit, 1958-2011

Figure 28: Accumulated Greek Deficit 1980–2014

Figure 29: Greek Debt, October 2011: 350 Billion Euro

Figure 30: Greek Debts—in the End of the Year 2014—321,7 Billion Euro

Figure 31: Greece: Holdings of Sovereign Bonds by Domestic Banks and Non-Residents as a Percentage of Total MFI Assets

Figure 32: Share of Foreign Currency Debt in Central Government Debt, 1900-2011

Figure 33: Who Owns Greek Government Debt? (2007-2011)

Figure 34: Foreign claims on Greece

Figure 35: Who Owns Greek Government Debt? (End of 2014)



List of Maps:

Map 1: The consecutive territorial enlargements of Greece

Map 2: Geographical Macedonia and Present Day State Boundaries

Map 3: Ethical Composition of the Southern Balkans

Map 4: Ethnical Composition of the Southern Balkans






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The question of the class character of Greece is of crucial importance both for the domestic as well as for the international workers movement: Is it an imperialist state, a semi-colonial country or something else, and what are its specific features?

The importance of this question arises from the intensity of the class struggle in Greece during the recent years. It is hardly an exaggeration to say that what the Arab Revolution has been for the world in the past few years, Greece has been for Europe. While the former has been the region of the world with the most advanced class struggle since 2010, Greece has played this same role for the European class struggle.

The Greek workers’ movement and left are divided on the issue of the country’s class character. Some argue that Greece is a minor imperialist power while others argue that is a dependent or semi-colonial country. There are also some who characterize Greece as a sub-imperialist state.

Such an analysis is often used to justify certain tactics. Various reformists and centrists, who consider Greece as dependent, use the country’s backwardness as an excuse for their opportunism with regard to Greek nationalism and their adaption to the Greek bourgeoisie. Others, who consider Greece as an imperialist or a sub-imperialist state, use their analysis to justify sectarian tactics.

The RCIT has elaborated the analysis that Greece is an advanced semi-colonial country with some specific features. [1] We endorse the historical characterization of Greece by the Trotskyist Fourth International which stated in 1945: Greece is undoubtedly among the most backward and poorest countries of Europe. For over a century it has been condemned to the status of a semi-colony of the major European Powers.[2]

It retained such a dependent position in the decades after World War II. We recognize that Greek capital has made serious attempts to become a minor imperialist power during the 1990s and 2000s. However, in the end it failed to overcome its backward character and remains a dependent country subordinate to the European imperialist powers.

Hence, we support the slogan for Greece’s exit from the EU and the Eurozone and combine this with a transitional program for socialist revolution. The European workers’ movement must mobilize against the colonialization of Greece by the EU-Troika and support the Greek resistance. At the same time revolutionaries should oppose Greek chauvinism in all its various forms. This includes the need to support the rights of Greece’s migrants and national minorities as well as to oppose the expansion of Greek capital into the Balkan countries. [3]

The following study will present a more detailed analysis of the contradictory development of Greek capitalism, its failed attempts to become a minor imperialist power and its present situation as an advanced semi-colonial country with some specific features. Finally, we will discuss the most important programmatic conclusions of this analysis.

We hope that the present publication will provide a useful contribution to the discussion among revolutionaries in Greece in order to clarify the class character of Greece and the consequent tasks. We await feedback and criticism from our Greek comrades in arms.

Finally, we wish to express our special thanks to comrade Gerard Stephens who performed the English-language editing for this book.

[1] We first elaborated our analysis of Greece’s class character in a pamphlet by Michael Pröbsting: Revolution in Griechenland. Möglichkeiten, Gefahren und Perspektiven, November 2011; in English: Perspectives on the Greek Revolution. Greek tragedy is the lack of revolutionary leadership of workers movement! For Workers’ Councils, Workers’ Militias and a Workers’ Government!

[2] The Editors of Fourth International: Civil War in Greece, February 1945, in: Fourth International, Volume VI, No. 2,

[3] We refer readers to the numerous statements and articles in which the RCIT has outlined its analysis and perspective for the Greek class struggle in the recent years. They have been published in various issues of our international journal Revolutionary Communism and are collected in a special subsection on Greece on our website:

Chapter I. Some Theoretical Considerations

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Before we present a concrete analysis of Greek capitalism and discuss its specific class character, we need to begin with a summary of the theoretical approach of Marxists on this issue: What is the respective definition of an imperialist vs. a semi-colonial state? Our methodological understanding of imperialism is based on Lenin’s theory, which became the basis for revolutionary Marxism from the early 20th century. [1]


I.1 What are the Respective Characteristics of an Imperialist vs. a Semi-Colonial State?


Lenin described the essential characteristic of imperialism as the formation of monopolies which dominate the economy. Related to this, he pointed out the fusion of banking and industrial capital into financial capital, the increase in capital export alongside the export of commodities, and the struggle for spheres of influence, specifically colonies. [2]

The formation of monopolies and great powers increasingly led to the division of the entire world into different spheres of influence among the rival imperialist states and the subjugation of most countries under these few great powers. From this follows an essential feature of Lenin’s (and Trotsky’s) analysis of imperialism: the characterization of the connection between the imperialist nations and the huge majority of people living in the capitalistically less developed countries as a relationship of oppression. In fact Lenin, and following him, Trotsky too, came to the conclusion that this division of the world’s nations into oppressor and oppressed nations is one of the most important characteristics of the imperialist epoch:

Imperialism means the progressively mounting oppression of the nations of the world by a handful of Great Powers (…) That is why the focal point in the Social-Democratic programme must be that division of nations into oppressor and oppressed which forms the essence of imperialism, and is deceitfully evaded by the social-chauvinists and Kautsky. This division is not significant from the angle of bourgeois pacifism or the philistine Utopia of peaceful competition among independent nations under capitalism, but it is most significant from the angle of the revolutionary struggle against imperialism.[3]

From this, Lenin concluded that the division between oppressed and oppressor nations must constitute a central feature of the Marxist program:

The programme of Social-Democracy (this is how the Marxists called themselves at that time, Ed.), as a counter-balance to this petty-bourgeois, opportunist utopia, must postulate the division of nations into oppressor and oppressed as basic, significant and inevitable under imperialism.[4]

The relationship between states has to be seen in the totality of its economic, political, and military features – “the entire totality of the manifold relations of this thing to others“ (Lenin). [5] Thus, a given state must be viewed not only as a separate unit, but first and foremost in its relation to other states and nations. Similarly, by the way, classes can only be understood in relation to one other. An imperialist state usually enters a relationship with other states and nations whom it oppresses, in one way or another, and super-exploits – i.e., appropriates a share of its produced capitalist value. Again this has to be viewed in its totality, i.e., if a state gains certain profits from foreign investment but has to pay much more (debt service, profit repatriation, etc.) to other countries’ foreign investment, loans etc., this state can usually not being considered as imperialist.

The economic basis of the relationship between imperialist and semi-colonial states is what Lenin called the super-exploitation of these oppressed nations by the imperialist monopolies. Because of this super-exploitation, monopoly capital can acquire – in addition to the average profit rate – an extra profit. These extra-profits are important additions to the profits which monopoly capital already extracts from the workers in the rich countries. They are, by the way, an essential source to bribe the upper, aristocratic sectors of the working class and in particular the labour bureaucracy in the imperialist countries and this helps to strengthen the rule of monopoly capital.

In our book, The Great Robbery of the South, we have elaborated basically four different forms of super-exploitation by which monopoly capital obtains extra profits from colonial and semi-colonial countries: [6]

i) Capital export as productive investment

ii) Capital export as money capital (loans, currency reserves, speculation, etc.)

iii) Value transfer via unequal exchange

iv) Value transfer via migration (based on the super-exploitation of migrants, a nationally oppressed layer of the working class)

Finally we want to stress the need to consider the totality of a state’s economic, political, and military position in the global hierarchy of states. Thus, we can consider a given state as imperialist even it is economically weaker, but still possesses a relatively strong political and military position (like Russia before 1917 and, again, in the early 2000s). Such a strong political and military position can be used to oppress other countries and nations and to appropriate capitalist value from them.

Naturally, it is not sufficient to divide countries into categories of imperialist or semi-colonial states. There are of course many different shades. This already begins with differences among Great Powers. There are Great Powers like the strongest one, the US, but also others which were economically strong but militarily much weaker in recent decades (like Japan or Germany). Then we have to differentiate between Great Powers and smaller imperialist states (like Australia, Belgium, Switzerland, the Netherlands, Austria, the Scandinavian countries, etc.). Obviously they are not the equals of the Great Powers, but rather are subordinated to them. These smaller imperialist states are politically and militarily dependent on one or several Great Powers in order to participate in the global imperialist order. Hence, they ensure their privileged position by entering economic, political, and military alliances with the Great Powers like the EU, OECD, IMF, World Bank, WTO, NATO, and various “partnerships.” However, these smaller imperialist states are not super-exploited by the Great Powers but rather participate in the super-exploitation of the semi-colonial world by appropriating a significant amount of value from semi-colonies.

In short, we define an imperialist state as follows: An imperialist state is a capitalist state whose monopolies and state apparatus have a position in the world order where they first and foremost dominate other states and nations. As a result they gain extra-profits and other economic, political and/or military advantages from such a relationship based on super-exploitation and oppression. [7]

Likewise, one also has to differentiate between different types of semi-colonies. Obviously there are huge differences today between Peru and Argentina or Brazil, Congo and Egypt, Pakistan and Turkey, Nepal and Thailand, Kazakhstan and Poland. Some countries are more industrialized than others, some have achieved a certain political latitude and others not. Hence, we can differentiate between advanced or industrialized semi-colonies like for example Argentina, Brazil, Egypt, Turkey, Greece, Iran, Poland or Thailand on the one hand and poorer or semi-industrialized semi-colonies like Bolivia, Peru, the Sub-Saharan African countries (except South Africa), Pakistan, Afghanistan, Indonesia etc.

Nevertheless, it is important to bear in mind that these different types of semi-colonies have much more in common than what differentiates between them, as Trotsky has already pointed out:

Colonial and semi-colonial – and therefore backward – countries, which embrace by far the greater part of mankind, differ extraordinarily from one another in their degree of backwardness, representing an historical ladder reaching from nomadry, and even cannibalism, up to the most modern industrial culture. The combination of extremes in one degree or another characterizes all of the backward countries. However, the hierarchy of backwardness, if one may employ such an expression, is determined by the specific weight of the elements of barbarism and culture in the life of each colonial country. Equatorial Africa lags far behind Algeria, Paraguay behind Mexico, Abyssinia behind India or China. With their common economic dependence upon the imperialist metropolis, their political dependence bears in some instances the character of open colonial slavery (India, Equatorial Africa), while in others it is concealed by the fiction of State independence (China, Latin America).[8]

To summarize our definition of semi-colonies we propose the following formula: A semi-colonial country is a capitalist state whose economy and state apparatus have a position in the world order where they first and foremost are dominated by other states and nations. As a result they create extra-profits and give other economic, political and/or military advantages to the imperialist monopolies and states through their relationship based on super-exploitation and oppression.


I.2 Is a Transition from Being One Type of State to Another Possible?


The analysis and division of countries into different types must not be understood in a dogmatic, mechanistic way, but rather in a Marxist, i.e. dialectical, way. Lenin already pointed out that definitions are not abstract dogmas but have to be understood as elastic categories: „…without forgetting the conditional and relative value of all definitions in general, which can never embrace all the concatenations of a phenomenon in its full development…“. [9]

Hence, it would be wrong to imagine the Great Wall of China Wall separating the two categories, imperialist and semi-colonial states. As we have argued on other occasions there have been several examples where, under exceptional circumstances, a dependent state was able to become an imperialist country as well as the other way round. The central reason for this is the law of uneven and combined development which explains the different tempos of development of productive forces in different nations and their interaction which again results in instability, clashes, wars and transformations of existing political and social relations. [10] It is therefore only logical that such developments can bring about the emergence and growth of new capitalist powers as well as the decline of old powers. [11]

Lenin himself has explicitly pointed out the possibility that backward, semi-colonial countries could transform their class character:

Capitalism is growing with the greatest rapidity in the colonies and in overseas countries. Among the latter, new imperialist powers are emerging (e.g., Japan).[12]

Indeed, as we have pointed out elsewhere, there have been various historical examples of such transformations. There is the example of Czechoslovakia which was a colony in the Habsburg Empire but became – after the implosion of the latter in 1918 – a minor imperialist power. Likewise, South Korea and Israel became imperialist states in the 1990s as did Russia and China in the early and late part of the first decade of the 2000s respectively. [13] On the other hand, Portugal most likely lost its imperialist status during the last four decades following the loss of its colonies in 1974.


I.3 Is the Category of “Sub-Imperialism” Useful?


A number of progressive theoreticians support the conception of a “transitional” or “sub-imperialist” state as a third, additional category of countries in addition to colonial and semi-colonial countries. We have elaborated our criticism of the theory of sub-imperialism in The Great Robbery of the South and we will only summarize here briefly some conclusions. [14]

Naturally if states undergo a process of transformation from an imperialist to a semi-colonial country or the other way around, they are “in transition” and in this sense it can be useful to describe a temporary process of transformation. However, the supporters of the theory of sub-imperialism don’t understand this as a category to describe the transition process but rather see it as a separate, independent category. And here lies the fundamental problem.

Capitalism unites all nations in the world via economic and political expansion and the formation of a world market. This process has taken place from the beginning of the capitalist mode of production and has tremendously accelerated in the epoch of imperialism. Under these conditions, no nation escapes the formation of ever closer economic and political ties with the dominant imperialist powers. Such close relations automatically create, modify, and reproduce mechanisms of exploitation and super-exploitation. In other words, under capitalism – and even more under imperialism – all nations are sucked into the process of super-exploitation. Either they are strong enough and become part of the oppressing nations, or they are pushed into the camp of the majority of humanity – the oppressed nations. There is no “third camp” in between.

Of course, there are significant differences in the development of the productive forces among the imperialist states as well as among the semi-colonial countries. This is only logical given the unequal dynamic of development between nations. Hence, it is indeed true that there are bigger and smaller imperialist countries which are unequal. However, the point is that the smaller are not exploited by bigger imperialist powers. For example the USA and Canada are certainly not equal but also don’t systematically exploit each other. The same is true for Germany and Austria or France and Belgium, Luxemburg or Switzerland. However they are all imperialist nations. Why? Because they have developed significant monopoly capital and financial capital which is used to systematically exploit and transfer value from the South, and they are part of an international imperialist order from which they profit and defend by various means. Likewise there are advanced semi-colonies which have a certain regional influence (e.g., Brazil, India, Greece) and others which have none; some are stronger and others are weaker. But as Marxist we must focus on the law of value and the transfer of value between countries and the political order associated with this. And here it is obvious that the industrialised semi-colonies are also dominated and super-exploited by the imperialist monopolies. For these reasons we reject the usefulness of the category of “Sub-Imperialism” as part of the Marxist analytical apparatus.

[1] We have dealt with Lenin’s theory of imperialism extensively in other publications. See, for example: Michael Pröbsting: Lenin’s Theory of Imperialism and the Rise of Russia as a Great Power. On the Understanding and Misunderstanding of Today’s Inter-Imperialist Rivalry in the Light of Lenin’s Theory of Imperialism. Another Reply to Our Critics Who Deny Russia’s Imperialist Character, in: Revolutionary Communism No. 25, August 2014,; Michael Pröbsting: The Great Robbery of the South. Continuity and Changes in the Super-Exploitation of the Semi-Colonial World by Monopoly Capital Consequences for the Marxist Theory of Imperialism, 2013,; Michael Pröbsting: Imperialism and the Decline of Capitalism (2008), in: Richard Brenner, Michael Pröbsting, Keith Spencer: The Credit Crunch – A Marxist Analysis (2008),

[2] In Imperialism and the Split in Socialism – his most comprehensive theoretical essay on imperialism – Lenin gave the following definition of imperialism:

We have to begin with as precise and full a definition of imperialism as possible. Imperialism is a specific historical stage of capitalism. Its specific character is threefold: imperialism is monopoly capitalism; parasitic, or decaying capitalism; moribund capitalism. The supplanting of free competition by monopoly is the fundamental economic feature, the quintessence of imperialism. Monopoly manifests itself in five principal forms: (1) cartels, syndicates and trusts—the concentration of production has reached a degree which gives rise to these monopolistic associations of capitalists; (2) the monopolistic position of the big banks—three, four or five giant banks manipulate the whole economic life of America, France, Germany; (3) seizure of the sources of raw material by the trusts and the financial oligarchy (finance capital is monopoly industrial capital merged with bank capital); (4) the (economic) partition of the world by the international cartels has begun. There are already over one hundred such international cartels, which command the entire world market and divide it “amicably” among themselves—until war redivides it. The export of capital, as distinct from the export of commodities under non-monopoly capitalism, is a highly characteristic phenomenon and is closely linked with the economic and territorial-political partition of the world; (5) the territorial partition of the world (colonies) is completed. (V. I. Lenin: Imperialism and the Split in Socialism (1916); in: CW Vol. 23, pp. 105-106 [Emphasis in the original])

[3] V. I. Lenin: The revolutionary Proletariat and the Right of Nations to Self-Determination (1915); in: LCW 21, p. 409

[4] V. I. Lenin: The Socialist Revolution and the Right of Nations to Self-Determination (1916); in: LCW 22, p. 147

[5] V.I.Lenin: Conspectus of Hegel’s Science of Logic (1914); in: Collected Works Vol. 38, p. 220

[6] Beside the extensive analysis in our book The Great Robbery of the South(see above) we refer readers also to our booklet on the super-exploitation of migrants (in German language): Michael Pröbsting: Marxismus, Migration und revolutionäre Integration (2010); in: Revolutionärer Kommunismus, Nr. 7, A summary of this study in English-language: Michael Pröbsting: Marxism, Migration and revolutionary Integration, in: Revolutionary Communism, No. 1 (English-language Journal of the RCIT),

[7] We think such a definition of an imperialist state is in accordance with the brief definition which Lenin gave in one of his writings on imperialism in 1916: „… imperialist Great Powers (i.e., powers that oppress a whole number of nations and enmesh them in dependence on finance capital, etc.)…“ (V. I. Lenin: A Caricature of Marxism and Imperialist Economism (1916); in: LCW Vol. 23, p. 34)

[8] Leon Trotsky: The Chinese Revolution (Introduction to Harold R. Isaacs, The Tragedy of the Chinese Revolution, London 1938);

[9] V. I. Lenin: Imperialism, the Highest Stage of Capitalism; in: LCW 22, p. 266

[10] We will deal with the law of uneven and combined development more in detail in the chapter “The Marxist Tradition and the Law of Uneven Development of Capitalism” in our forthcoming book on the Marxist theory of imperialism.

[11] We have dealt with the issue of the emergence of new imperialist powers extensively. On this see, for example:

On China as an emerging imperialist power:

Michael Pröbsting: The Great Robbery of the South (Chapter 10),; Michael Pröbsting: China‘s transformation into an imperialist power. A study of the economic, political and military aspects of China as a Great Power, in: Revolutionary Communism (English-language Journal of the RCIT) No. 4,; Michael Pröbsting: No to chauvinist war-mongering by Japanese and Chinese imperialism! Chinese and Japanese workers: Your main enemy is at home! Stop the conflict on the Senkaku/Diaoyu-islands in the East China Sea! 23.9.2012, in: Revolutionary Communism No. 6,; Michael Pröbsting: Russia and China as Great Imperialist Powers. A Summary of the RCIT’s Analysis, 28 March 2014, in: Revolutionary Communism No. 22,; Michael Pröbsting: More on Russia and China as Great Imperialist Powers. A Reply to Chris Slee (Socialist Alliance, Australia) and Walter Daum (LRP, USA), 11 April 2014, in: Revolutionary Communism No. 22,; Michael Pröbsting: The China Question and the Marxist Theory of Imperialism. Again on China as an imperialist Power. Reply to a Polemic from CSR (Venezuela) and PCO (Argentina), December 2014, in: Revolutionary Communism No. 32,

On Russia as an emerging imperialist power:

Michael Pröbsting: Lenin’s Theory of Imperialism and the Rise of Russia as a Great Power. On the Understanding and Misunderstanding of Today’s Inter-Imperialist Rivalry in the Light of Lenin’s Theory of Imperialism. Another Reply to Our Critics Who Deny Russia’s Imperialist Character, in: Revolutionary Communism No. 25, August 2014,; Michael Pröbsting: Russia as a Great Imperialist Power. The formation of Russian Monopoly Capital and its Empire – A Reply to our Critics, 18 March 2014, in: Revolutionary Communism No. 21,

[12]V. I. Lenin: Imperialism, the Highest Stage of Capitalism (1916) ; in: LCW Vol. 22, p. 274

[13] We have analyzed South Korea’s transformation into a minor imperialist power in Michael Pröbsting: Der kapitalistische Aufholprozeß in Südkorea und Taiwan; in: Revolutionärer Marxismus Nr. 20 (1996). A shortened version of this article appeared as “Capitalist Development on South Korea and Taiwan” in: Trotskyist International No. 21 (1997), On Israel as a minor imperialist power see Michael Pröbsting: On some Questions of the Zionist Oppression and the Permanent Revolution in Palestine“, in: Revolutionary Communism Nr. 10 (June 2013), p. 29,

[14] See Michael Pröbsting: The Great Robbery of the South, pp. 220-228. See

Chapter II. Brief Historical Overview of the Development of Greek Capitalism

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Note of the Editorial Board: The following document contains several figures and maps. They can be viewed in the pdf version of this document (see above).


* * * * *

It is beyond the scope of this essay to give a comprehensive analysis of the history of Greece since its independence from the Ottoman Empire in the early 19th century. [1] Instead we will focus on the development of Greek capitalism so that we can elaborate its specific features.


II.1 The Emergence of the Greek Bourgeoisie under the Ottoman Empire and the Struggle for National Independence


Given the centuries-long occupation by the Ottoman Empire, the peoples of the Balkans began their national and modern development much later than most Western European countries. Among the Balkan peoples, Greece and Serbia were the first who took up the struggle for liberation against Ottoman rule in the early 19th century.

In this effort the Greeks had certain advantages which helped them to achieve independence earlier than most Balkan peoples. Trade in the Ottoman Empire, whose economy was characterized by what Marx called the “Asiatic Mode of Production,” became dominated by non-Muslim people. [2] This process already started in the fifteenth and sixteenth centuries. Gradually the Greeks (and to a lesser extent, the Jews and the Armenians) managed to control most of the internal and external trade of the empire and provided many members of the Ottoman state administration and diplomatic corps. (These influential and wealthy Greek families became known as “Phanariotes.”) [3]

This development is reflected by the fact that, as late as 1912, out of 112 bankers and bank managers in the Ottoman Empire only one was a Muslim Turk. In industry, it has been estimated that only 15% of capital belonged to Turks. According to the Soviet scholar O. G. Indzhikyan, the ethnic composition in business was as follows (see Table 1).


Table 1: Ethnic Composition of Business in the Ottoman Empire by Percent (1912) [4]

                                                        Turks                     Greeks                   Armenians                           Others

Internal trade                                      15                           43                           23                                           19

Industry and crafts                              12                           49                           30                                           10

Professions                                         14                           44                           22                                           20


Hence we saw “the emergence in the course of the eighteenth century of an entrepreneurial, widely dispersed and preposterous mercantile class whose activities were as much based outside as within the Ottoman domains.” [5] As a result Greek became the lingua franca of Balkan commerce. This mercantile bourgeoisie built communities in the Greek Diaspora in Cairo, Alexandria, and Istanbul as well as in major commercial centers of the Russian Empire, in Trieste, Naples, Marseilles, Amsterdam, Antwerp, London, Liverpool and Paris. Over 80,000 Greek families, for example, resided in the Austro-Hungarian Empire. [6]

The rise of the Greek merchants was assisted by the fact that, during the French revolutionary and Napoleonic Wars 1792-1815, the British and the French virtually destroyed each other’s merchant marine in the Mediterranean. The Greek shipping traders stepped into the vacuum thus created and achieved a monopolistic position.

As a result, this Greek mercantile bourgeoisie played a leading role, together with intellectuals and professionals trained abroad, in awakening and spreading a national consciousness – combined with Western culture – among the Greek people. In 1814, Greek merchants in Odessa founded the secret revolutionary organization Philike Hetairia (Society of Friends). They also provided material support for the popular uprising against Ottoman domination which led to the Greek War of Independence from 1821 to 1829. It was this new merchant class which – together with the impoverished peasantry who were suffering from small land holdings [7] – was the decisive force in the national liberation struggle. The traditional Greek elite, i.e., the high clergy and the big landowners, had a greater stake in the status quo and hence were much more lukewarm vis-a-vis the revolution. The majority of them joined the struggle only after they realized that the nationalist movement was irreversible. [8]

The Greek War of Independence evoked great enthusiasm and won the wholehearted support of revolutionists and liberals throughout Europe, for whom the English poet Lord Byron became a famous symbol. However, the European Great Powers had an ambivalent attitude to this popular uprising. On one hand they had an interest in weakening the Ottoman Empire as a rival. On the other hand, they were also interested in maintaining stability and not igniting the entire Balkan Peninsula. As a result England, France and Russia (as well as Mehmet Ali of Egypt) intervened on different sides of the conflict. Finally, they pressed to bring the liberation war to a close and came to an agreement with the Sultan in 1829. [9] This agreement recognized a small independent Greece, only a fraction of present-day Greece, with a population of no more than 800,000, representing less than one-third of the 2.5 million Greek inhabitants of the Ottoman Empire.


II.2 Greece after the War of Independence (1821-29) until 1922


However, the Great Powers made certain from the start that Greece became only formally independent while in fact it remained a dependent country, i.e., a semi-colony. The Great Powers forced the new state to become a monarchy with the 17 years old Bavarian prince (!), Otto von Wittelsbach, at its head. After several uprisings he was eventually dethroned in 1862 and a year later was replaced by Prince Wilhelm of Denmark, also 17 years of age upon assuming the throne.

Greece’s utter subservience to the Great Powers was also reflected in the Treaty of 1864 which expressly laid down that any one of the three signatory powers (England, France and Russia) might send troops into Greek territory with the consent of the other two signatories, while the consent of Greece itself was not necessary.

Furthermore, the Ionian Islands on the western coast of Greece, home to a number of large shipping magnates, constituted “a sovereign state under the protection of the British crown” until London formally handed them over to Greece in 1864. [10]

Greece’s financial situation was desperate from the beginning. The long war with the Turks left the Greeks with huge debts to British banks. Greece had to ask for another loan which it received in 1833. However, this debt only increased the pressure on the state to impose oppressive taxes on the peasantry, many of whom chose to flee to the hill country. Brigandage, which has a long history throughout the Balkans, once more took on serious proportions. Given the weakness of the domestic bourgeoisie and the lack of foreign investment, the Greek state relied heavily on foreign capital – mostly in the form of loans – for the financing of basic infrastructure projects (harbors, roads and rail networks). From 1879 to 1893 alone, Greece imported foreign loans and investment worth about 750 million Gold-Francs. [11]

Naturally this exacerbated Greece’s debt and the country’s inability to pay back its loans resulted in increasing annual budget deficits and finally an official declaration of national bankruptcy in 1893.

According to the Greek historian Giannes Koliopoulos, the country’s debt exploded: “Between 1876 and 1884 the national debt doubled. Three years later it had quadrupled and, by 1893, it was seven times the amount it had been 17 years earlier.[12]

After Greece lost its war with Turkey, sparked by a national uprising of the Greek population on Crete in 1896, it had to pay extraordinarily high indemnities. Consequently, in 1898 the country was brought under the control of the so-called “International Control Commission“ (the name was later changed to the International Finance Commission). Greece was stripped of its sovereign powers by the “protecting powers.” The International Finance Commission virtually took charge of Greek finances and guaranteed re-payment of the country’s debt. Crete, whose national revolution led to the Greek-Turkish war, was put under international control, with the island divided into British, French, Russian and Italian spheres.

Greeks dependency on the British Empire was also increased by the specific character of the Greek bourgeoisie. As already mentioned, the Greek capitalists were mainly traders among whom the shipping magnates were the most important. Thus, they were not interested in investing their capital in building a domestic industry with the result that the process of capital accumulation in Greece progressed very slowly and was primarily dominated by foreign capital. Many of the Greek capitalists did not reside in Greece but rather abroad in Europe, Russia or the Middle East. As a result, the Greek population was extremely dependent on the support of the Great Powers.

The Trotskyist Fourth International correctly commented on Greece’s history after achieving independence: “In truth, its independence was largely fictitious. It was in reality a semi- colony of Britain, France and Russia, forced to tolerate the rule of a foreign prince imposed upon it by its bond-holding "liberators" or as they dubbed themselves in those days, the 'Protecting Powers.’ The history of Greece epitomizes the fate of all the Balkan peoples as indeed of all small nations — the impossibility for small nations to achieve under capitalism real independence, as distinguished from formal political independence.[13]

This dependency on foreign powers went hand in hand with the persistent backwardness of the Greek economy for which there were a number of important facets. First, as just indicated, Greek merchants hardly invested at home, with the result that only relatively few industrial enterprises existed in the country by the 1920s. In fact, by 1917 there were still only 35,500 industrial workers in the country. [14]

Related to this lack of wide scale industrialization, the Greek economy remained largely dominated by agriculture for the most part of the period until World War II. In 1907, for example, the share of the rural population was 77%.

In large parts of Greece, petty ownership in the agricultural sector predominated. The only exceptions were in the provinces of Thessaly, Macedonia and Thrace. Compared with other countries, Greece’s large landowning class was not very large. Nevertheless at the beginning of World War I, about 35% of all arable land was still owned by big landowners. [15]

At the same time, agricultural production was strongly orientated towards external markets. As such, it had a high degree of specialization virtually bordering on being a monoculture, with raisins and tobacco being the two main export products.

In short, production, even in small farms, was primarily for the overseas market. This also resulted in a relatively rapid monetarization of the economy, especially once the payment of taxes in cash was introduced.

Greece’s important commercial sector was strongly linked to agriculture. In fact, these two branches of the economy depended on each other since agricultural products were the only commodities which the merchants could trade while, at the same time, the peasants needed the merchants to sell their products.

As a result Greece remained a dependent capitalist country was and became one of the most backward in Europe. As we can see in Table 2, its level of industrialization was – other than Bulgaria – the lowest in Europe.


Table 2: Relative GDP per capita (column A) and relative levels of industrialization (column B) in 1913 [16]

Country                A             B                                             Country                A             B

Britain                   100         100                                         Ireland                  60          

Belgium                83           77                                           Italy                       52           23

France                   81           51                                           Spain                     48           19

Switzerland            81           75                                           Finland                 46           18

Denmark               80           29                                           Hungary              41          

Germany              77           74                                           Greece                  38           9

Netherlands           75           23                                           Portugal               35           12

Sweden                 71           58                                           Bulgaria               32           9

Norway                68           26                                           Russia                   29           17

Austria                 62           29


Nicos Mouzelis, a progressive Greek sociologist and historian, points out that both agriculture and industry had hardly any large enterprises: “In the nineteenth century, despite the country's full integration into the world market system, Greece was still a pre-capitalist social formation. Both in agriculture and in industry, capitalist enterprises— i.e. economic units using a relatively large number of wage labourers —were virtually non-existent.[17]

While a small group of oligarchic families (the so-called tzakia) and capitalists were able to enrich themselves despite the country’s backward economy, the mass of the population lived in dire poverty. According to official statistics, 72% of the total population was classified as “have-nots,” i.e., they possessed neither a piece of land nor a small enterprise. Given the fact that wage laborers constituted only a small minority of the working populace, it is evident that rural poverty was widespread.

It is therefore hardly surprising that many Greeks immigrated abroad – particularly to the United States. It is estimated that during the period 1890-1914 almost a sixth of Greece’s population emigrated. [18]

Another facet of Greece’s backwardness was the fact that the majority of its population lived in villages – a fact which changed only slowly. According to the first census (conducted in 1861) 74% of adult men were agriculturalists who earned their livelihood by working the land. By 1920 this figure had barely changed (70%). Similarly, in 1920 almost 52% of the entire population lived in villages of less than 1,000 individuals. [19]

During this same year, 17.6% of the Greek population lived in cities of 20,000 and 12.6% inhabited cities of 100,000 or more. (By way of comparison, the figures for urban dwellers in Chile for the same period were 32.7% and 27.1%, respectively, while in Argentina 27.1% of the population lived in cities of 100,000 in 1920.) [20]

Regardless of this overall slow urban growth, Athens grew into a huge city of 453,000 people (1920) and became even larger when 1.5 million refugees from Asia Minor arrived in Greece after 1922.

Another important characteristic of independent capitalist Greece is the enormous role played by the state apparatus. During the 1870s, the number of civil servants per 10,000 of the population was approximately seven times higher than in the United Kingdom! [21] Such a monstrous administrative glut was necessary to keep this backward society together, to maintain an army which would be needed for Greece’s expansionist plans, as well as to facilitate mobilizing resources for modernization. Furthermore, the state apparatus could provide employment for many of those who were leaving the countryside and could not otherwise be absorbed considering Greece’s hardly existing industry. Naturally, such an overblown state apparatus ensured relati