Thessaloniki has been selected as the Cultural Capital of Europe for 1997. This is no accident, of course, when one considers the city's role during the Middle Ages and the period of the Ottoman rule, and its influential position in the Balkans, which has been made all the more significant following the collapse of the communist regimes in the neighbouring Balkan countries. Today, perhaps more than at any other time in the last fifty years, prospects for further development are emerging, enabling the city to rise to the challenge of its new historic role.

Built in 315 BC by Cassander, King of Macedonia, Thessaloniki was a major economic centre in Hellenistic Macedonia, and its position was further enhanced in the Roman period by the construction of the via Egnatia, which linked the western and eastern provinces of the Roman Empire via Thessaloniki. Galerius Maximilianus Caesar correctly evaluated the city's strategic position when, around 300 AD, he selected Thessaloniki as the administrative seat of the eastern Empire, so that barbarian raids might be more effectively repulsed. It was at this time that one of the largest complexes of the age was built, Galerius palace, which covered 150,000 m2 and occupied the eastern section of the Roman Thessaloniki. One remnant of this era is Galerius triumphant arch, known to everyone as the Kamara. The reliefs on it represent scenes from Galerius campaigns against the Persians and various other events following his victory in 297. This was the time when Christians were being relentlessly persecuted, and St. Demetrius was martyred in 305. The importance Thessaloniki had already acquired in the Roam period explains why in the Byzantine period it became the capital of Illyricum and the Empire's second city after Constantinople. Thessaloniki remained firmly under Byzantine control, repelled incursions by the Avars and the Slavs in the sixth and the early seventh century, rapidly recovered from the ravages inflected by the Saracens in 904 and the Normans in 1185, and after a brief period of Frankish rule (1204-24) became part of the Despotate of Epirus and then of the Empire of Nicaea. Thessaloniki has gone down in history as the birthplace of SS, Cyril and Methodius, who devised the Glagolitic alphabet, translated scriptures and worked tirelessly for the acculturation of the Slavs. In the fourteenth century, it was a hotbed of theological strife between the Hesychasts (inspired by the Orthodox Christian tradition and represented by Gregory Palamas) and their opponents who were influenced by western scholastic philosophy and represented by Barlaam of Calabria. It was also in Thessaloniki that one of the first social movements in Europe manifested itself, the Zealot movement in the fourteenth century.

In 1430, Thessaloniki was conquered by the Ottoman Turks. During that period of Ottoman rule, the city was chiefly noted as a cosmopolitan commercial centre. Immediately after the conquest, the decimated native Greek Orthodox population was rapidly outnumbered by the Moslem element whose numbers had escalated as a result of colonisation, the conversion of the Christians to Islam, and the arrival of extra garrison troops and military and administrative personnel.

In the sixteenth century, the Jews were in the majority, having sought refuge here after their expulsion from Spain; but from the mid-seventeenth century onwards, the Jewish element dwindled somewhat, probably owing to the decline of Italian, and particularly Venetian trade, which was largely Jewish-based. Many thousands of Jews thus emigrated to Italy. However, the Jews contributed substantially to the emergence of the city as a center for Balcan trade and to its cultural character, until the Nazis deported them to concentration camps. There was no sign of a Slav population before the mid-nineteenth century, and the city also had a few "Frankish" inhabitants (Italians, French, Austrians, and Germans).

It was not until the eighteenth century that the Greek Orthodox population really started to play an active part in the city's economy, which was due to the fact that France and other west-European countries were now infiltrating the Ottoman Empire. The number of foreign merchant vessels using the port of Thessaloniki increased considerably, and the Greeks became brokers, compradors, and merchants in their own right.

With the outbreak of the French Revolution and the upheavals precipitated in Europe by the Napoleon wars, opportunities for Greek commerce in Thessaloniki proliferated, assisted by exploitation of the overland trade routes that ran along the Axios and Morava valleys to central Europe. In the first half of the nineteenth century, commercial activity in Thessaloniki suffered a decline owing to the Russo-Turkish wars, the persecution of the Greek population during and after the 1821 War of Independence, the European crisis and the shift of European interest to other markets. However, from the mid-nineteenth century onwards, with the institution of the Tanzimat reforms in the Ottoman Empire, Thessaloniki soon became the most important administrative, economic, and commercial centre in the Balkans. European Traders, in partnership with local Greek and Jewish businessmen, turned the port of Thessaloniki into a commercial agency for the whole of the east Mediterranean on par with Smyrna and Constantinople. The cityÕs flourishing economy was reflected in an impressive number of banks and banking establishments. It was at this time that the European capital began to infiltrate Thessalonikis market. The citys economic life received a further impetus from the new rail connection with Belgrade (1888) and central Europe, and soon afterwards with Constantinople (1896). The arrival of steam-propelled ships assured commercial traffic between Thessaloniki and the ports of the west Mediterranean. This westernisation-which also found expression in a number of western styles-was a more rapid process here than in other urban centres in the Levant.

All the same, alongside the middlemen, western economic agents, retailers and craftsmen, Thessaloniki still had a semi-agrarian population, making a living chiefly from viticulture and farming. The city also retained an oriental aspect owing mainly to the Moslems inability to adapt to the new conditions created by the Tanzimat. It was precisely this co-existence of western and eastern lifestyles that made Thessaloniki such an attractively cosmopolitan city.

Though not numerically in the majority, the Greek element made its own clear mark on the city. Apart from its economic activity, the Greek community also furthered the development of schools and education, particularly in the last decades of the nineteenth century. In 1882, there were ten Greek elementary schools and middle schools with 44 teachers and 2,200 pupils. Greek education made great strides in the first decade of the twentieth century when several private schools were established, including the Maraslian Hellenic and Practical Commercial Senior High School founded by Stefanos Noukas, and the Konstandinidis School. By 1908, there were 32 Greek educational establishments with 127 teachers and 7,796 pupils. As well as founding schools, from the mid-nineteenth century onwards the Thessalonicians also started setting up cultural associations. The Thessaloniki Educational Association was founded in 1871, its aims being to publish books, found a library and reading room, hold lectures and ensure the preservation of the citys monuments. Wealthy citizens and Greek emigres (including Grigorios Maraslis, Ioannis Papafis, Theayenis and Dimitrios Haissis) were generous benefactors who built and supported charitable and educational institutions. The local Greek printing houses also contributed to the rise of Thessalonikis intellectual life: the first was established in 1850 by Miltiadis Garbolas and by 1912 a total of 18 printing houses were in operation and had produced 196 books and 3 periodicals. The first Greek newspaper, Ermis (Hermes), came out in 1875. In 1881 its name was changed to Faros tis Makedonias (Beacon of Macedonia) and in 1897 to Faros tis Thessalonikis. Alitheia (Truth) came out in 1903 and Macedonia in 1911.

With the rekindling if the Macedonian Question in the late nineteenth century and early twentieth century, Thessaloniki became the focus of Greek and Slav rivalry and a hotbed of nascent Turkish nationalism. It was here that a group of Bulgarian intellectuals founded the Internal Macedonian Revolutionary Organisation (IMRO) in 1893, with the aim of achieving autonomy for Macedonia as a means of annexing the region to Bulgaria; and in January 1903, at the instigation of the Bulgarian government, which promised military support, IMRO resolved to foment an armed rising in Macedonia, the main intention being to turn the Macedonian Question into an international issue and to provoke the Great Powers to intervene and thereby resolve the issue in accordance with Bulgaria's demands. The rising was preceded by a series of terrorist attacks and bombings in Thessaloniki (including the blowing up of the French steamship Guadalquivir and the Ottoman Bank) by a group of young Bulgarians in April 1903. The Ilinden rising, as it was known, started August 2, 1903, but it failed because, apart from the Exarchists, IMRO did not enjoy wide support in Macedonia. However, the realisation of the threat to Greek interests in Macedonia roused the Greek government and the Greek communities in Macedonia. The consulate and the Diocesan Authorities in Thessaloniki co-ordinated the Greeks defensive Macedonian Struggle, and Athanassios Nikolaidis who was in charge of that aspect of the Struggle known as the "Thessaloniki Organisation", rallied the citys Greek community in the successful struggle against the Bulgarians.

The Greek-Slav rivalry in Macedonia added a chauvinistic tone to the Young Turk's national ideology. Under the influence of the Balkan peoples rivalry in Macedonia (one of the Ottoman Empire's last dominions in Europe) and the intervention of the Great Powers, it was not the liberal western outlook of the Young Turks that ultimately prevailed, but the notion that the Ottoman Empire should be turkicised, an ideology developed in Thessaloniki by Ziya Gokalp, the father of Turkish nationalism. The Young Turks Committee of Union and Progress was founded in Thessaloniki in 1906, and the city was the focal point of the Young Turk's revolution, which broke out on July 23, 1908. The euphoria it aroused, however, soon gave way to disillusionment with the Young Turks policy of Turkicising the various ethnic groups in the Empire, instead of keeping their original promises of equality and a constitution. In July 1909, Avraam Benaroya was one of the prime movers in the founding of the Socialist Labour Federation of Thessaloniki, more commonly known by the Judaeo-Spanish name, Federaction and the largest socialist organisation in the Balkans.

The Young Turks policy led to an alliance among the Balkan states (Greece, Bulgaria, Serbia, and Montenegro) which led in turn to the First Balkan War and the liberation of Thessaloniki by the Greek army on October 26, 1912. According to the census carried out in 1913 by the first Governor General of Macedonia, Konstandinos Raktivan, the population of Thessaloniki was 150,889; 39,956 Greeks, 45,867 Moslems, 61,439 Jews, 6,263 Bulgarians and 4,364 people of other nationalities. There were no real problems in incorporating Thessaloniki into the Greek state, for the Jews eventually accepted Greek sovereignty and the Moslems emigrated to Turkey. The Bulgarians claims (which triggered the Second Balkan War) were historically and demographically baseless. During the First World War, British and French troops landed in Thessaloniki to confront the Central Powers; and following the success of the National Defence revolutionary movement, the arrival of Eleftherios Venizelos in September 1916, and the establishment of his provisional government in Thessaloniki, Greece played a substantial part in the Ententes operations on the Macedonian Front. The provisional government was disbanded in June 1917, when, with the intervention of the Entente, King Constantine was deposed and Venizelos returned to power. During the War, the city became an entrenched encampment, with fortifications, storage areas, and extensive facilities for the maintenance, health care, and recreation of the troops. On August 18, 1917, a large area of the city burned down, which provided an opportunity for replanning the city centre and giving it an architectural face-lift.

It was in the period between the wars that Thessaloniki was given its modern Greek profile. After the replanning and the subsequent rapid rebuilding, it acquired the uniformity of urban design and architecture typical of any modern Greek city. The arrival of thousands of refugees from Asia Minor, the Black Sea, and Bulgaria brought a new ethnic homogeneity to the city, while at the same time giving an enormous impetus to economic and social life, or the refugees including skilled craftsmen, workers (notably weavers and carpet makers), and experienced farmers (silk farmers, vine-growers, and tobacco farmers), who made a substantial contribution to the citys development. The economic indicators rose: the agricultural production index went up thanks to land reclamation projects carried out on the Thessaloniki plain; the trade index rose because, despite losing its Balkan hinterland, Thessaloniki gained a population of producers and consumers; the light industrial production index went up because the new craft of carpet-making which the refugees brought with them developed rapidly and its products were soon the number one export. With gradual industrialisation, a working class emerged. The dreadful economic and social conditions that followed the market crash of 1929 impelled the workers to move into action, and the unrest culminated in the bloody events of May 1936, which inspired Yannis Ritsos epico-lyrical poem Epitaphios.

Two institutions made their mark in Thessaloniki in the inter-war period: the International Trade Fair and the Aristotle University, both founded in 1926. The Fair highlighted and promoted the countryÕs economic activity, withstood the test of time, and is still going strong today. The University contributed to the intellectual enhancement of northern Greece, with pioneering demoticists and progressive teachers, many of whom championed social and national struggles, ardently defended democracy, and made a fundamental contribution to the citys development.

During the Second World War, Thessaloniki was occupied by the Germans, who recognised the cityÕs strategic advantages and made it the headquarters of the Commander General of Thessaloniki and the Aegean, Krenzki, and of the Commander of the Army Group E, Lohr, who was also Supreme Commander of the German forces in south-eastern Europe in the first half of 1943. The occupation authorities seized the city's raw materials and consumer goods, and the urgent problem of food supplies throughout the occupation led to such unwholesome phenomena as black market trading and collaboration. One of the darkest aspects of the German occupation was the annihilation of most of the city's Jewish population.

The main target of resistance to the occupation was the University, joined by the various National Liberation Front organisations from 1942 onwards. Thessaloniki was liberated at the end of October 1944. The German occupation and the subsequent Civil War (1946-9) certainly had serious repercussions on the city's economic life; but it soon recovered, and in the 1960s Thessaloniki entered a period of intensive industrialisation. Rapid industrial development led to the arrival of a large work force from the countryside and a significant increase in the population. Commercial traffic in the port also increased considerably. The city acquired air links with various European cities, gained a second university in the 1980s, and the International Trade Fair continues to attract world-wide economic interest.

Thessaloniki has a Chamber of Commerce and Industry, and archaeological museum of Byzantine culture and a number of other scholarly and cultural foundations; a series of cultural events (the Demetria Festival) takes place every year in October, and the city is the headquarters of the Third Army Corps and the World Council of Hellenes Abroad. The port is an entrepot for merchandise from the east and west. The population is now more than 900,000.

With the collapse of the communist regimes in the Balkans, Thessaloniki has regained its Balkan hinterland for investment activities and is being hailed as the new metropolitan centre of the whole Balkan peninsula. Standing at the cross-roads between the nations of east and west, the economic centre of south-eastern Europe, Thessaloniki is preparing to rise to the occasion as the Cultural Capital of Europe for 1997. This will be a golden opportunity to show the world its historical heritage, the culture of Greece, its economic worth, its ideas, its very soul. The city has been transformed into one vast worksite. The historic monuments (Macedonian tombs, the Roman forum, Byzantine churches, the Epitapiryio fortress, the mosque known as the Yeni Dzami) are all being restored, freed from makeshift props, and made serviceable and fit for new, modern uses. Theatres, music schools, museums, youth centres and other cultural establishments are being built. The Olymbion cinema-cum-theatre is being refurbished with a view to making it the permanent venues for the International Film Festival. The theatre of the Society for Macedonian Studies is having an architectural face-lift and being restored inside and outside, and equipped with the latest technology for staging operas, ballets and plays. The airport and the railway station are being modernised. New creative artistic and cultural institutions are being established and existing ones upgraded; Film Museum, Photography Museum, Museum of Modern Art, Waterworks Museum, International Drama Festival, Museum of Technology, art and workshops. The city's major cultural institutions (the Demetria Festival, the Film Festival, the Book Exhibition, the Open Theatre Festival) are receiving more support and promotion.

As the European City of Culture, will, for five months, host a monumental, unrepeatable exhibition of the Treasures of Mount Athos in the Museum of Byzantine Culture. A rich artistic programme will mark off the city's cultural life. By month the list of the programme is as follows: January, The Curtain Rises; February, Winter Wave; March, Native Swallows; April, Easter Chonicle; May, European Voyage; June, Treasures of Athos; July, Sea and Song; August, Battlements of Light; September, A Versatile World; October, The Children of St. Demetrius; November, Elegy of Waters; December, Saluting the New Century.

On the threshold of the twenty-first century, Thessaloniki bids Europe welcome. In the present climate of creative rivalry among the cities of Europe. Thessaloniki must keep the components of its character and its distinctive identity securely intact. It is precisely this recognition of its historical worth on the great continent of Europe that is the principal goal of the Cultural capital.