China's Acquisition of Piraeus Port a Booster for Greek Economy?
Greece has formally signed an agreement to sell a 67% stake in the Port of Piraeus to Chinese shipping company China Cosco Holding Co.
Under the deal, COSCO, the fourth-largest container shipping firm and second-largest port operator in the world, will pay the cash-strapped country 368.5 million euros (418.8 million U.S. dollars), and also promises to invest another 350 million euros (398.9 million dollars) over the next decade in infrastructure work at the port.
In five years of operation, COSCO aims to make the Piraeus port the south gate of the China-Europe land-sea express to speed up transportation between China and Europe, said Xu.
COSCO's vision to turn Piraeus into a leading international transit hub for products and services from Asia to Europe has already attracted other major multinationals at the port, which are cooperating with PCT to distribute their products in the region.
Xu Lirong, the President of China Cosco Shipping Corporation limited said that the port of Piraeus can play a pivotal role in the development of Greece's economy.
“Greece will have many benefits from China’s growing influence and power in the global market,” Xu said. “Chinese companies see huge investment opportunities in Greece and this is something that is backed by the Chinese government,” he added.
COSCO's development plan for the port will bring additional long-term revenues of 5.1 billion euros per year to the Greek economy and add some 125,000 jobs until the new concession agreement expires in 2052, says Foundation for Economic and Industrial Research (IOBE).
IOBE experts expect that the privatization of Piraeus port will generate half a billion euros in investments by other entrepreneurs in the first five years, according to a survey released by the Greek institution.
"The privatization can play a catalytic role in the port's development, sending a strong signal to international markets that Greece is a safe and attractive investment destination," the IOBE survey said.
Greek officials, local business bodies and experts have repeatedly stressed that new investments in Piraeus will further boost the port's role as a key transit hub for products in the Mediterranean, create much-needed jobs in the recession-hit country, and breathe new life into the ailing economy by attracting more investors.
Greek Prime Minister Alexis Tsipras said Friday that the agreement offers an important opportunity for the two countries to develop a growth path that can benefit both countries.
"The agreement sends a strong message to the global economic community for the recovery of the Greek economy," he added.
Meanwhile, Dockworkers at Piraeus Port have walked out and container terminals were shut on April 8 as Greece’s privatisation agency signed an agreement to sell the port.
In an announcement, the port employees said: “The government, despite its pre-electoral commitments, is proceeding to sell off the port. They threw away all the declarations regarding public ports and took advantage of fights between harbor workers in order to take power, and now throws parties to embrace the most neoliberal privatization.”
Piraeus, a few miles south of the Greek capital, is the de facto home of the country’s giant shipping industry and is one of the largest ports in the Mediterranean.
