The Greek defence industry is undergoing a transformation in order to meet market requirements and the challenge of shrinking defence budgets. It relies almost exclusively on in-country contracts or offset spin-offs from its Ministry of National Defence (MND) export purchases. Despite the government's best intentions to support industry, there have been few prime con-tractorships for Greek companies. The situation is exacerbated by the government's battles to maintain defence funding in the face of lough economic conditions, rising social welfare costs and the need for substantial investment for the Olympics, which are being held in Athens in 2004. The effort to develop an efficient industrial base, to support the Hellenic Armed Forces' procurement programmes, started in 1976, when the Defence Industry Directorate (DID) was established within the MND. Until the DID's foundation, the only large defence manufacturer was the privately owned Hellenic Powder and Cartridge Company (Pyrkal).
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