China's BIG PLANS for Greece

China’s major interest in Greece is its strategic assets, such as ports and railways. It is already an important investor. The jewel in the crown is the Mediterranean port of Piraeus, which has served as Athens’ shipping base for more than 2,500 years. 

 

Investing a billion dollars

In 2008, Chinese state-owned enterprise Cosco leased one of the two Piraeus terminals for 30 years. This was |at the height of the financial crisis and the port was |struggling. 

Cosco invested a billion dollars to upgrade and modernise the port. It replaced the outdated crane system and built a deep-water port capable of accommodating giant container ships. 

These investments and new management transformed the port into one of the biggest and fastest-growing in the Mediterranean, with traffic rising nine-fold over the seven years to more than three million containers a year. 

Apart from Piraeus, Chinese infrastructure investments include a logistics centre run by Huawei and a railroad that is being constructed to connect Piraeus with Central Europe and the major ports of Hamburg, Rotterdam and Antwerp.

 

An advantage

In 2014, Cosco signed an agreement with the government to build a third wharf and was shortlisted to buy the government’s 67-per-cent share in the remainder of the port. However, these plans were blocked when there was a change of government under the Syriza Party. 

Since privatisation of assets is part of the deals signed by Greece and the EU and the IMF, the door to Chinese investment will once more swing open. 

Already there has been some movement. Earlier this month it was announced that Cosco was among the companies shortlisted to take over the commercial operations |of Limassol Port, which is strategically located to take advantage of the Suez Canal extension.

While Cosco is not guaranteed success in buying these strategic assets – it will have to compete with companies from Europe, America and Asia – it certainly should have an advantage given its track record. 

As with so many Chinese initiatives, the Greek infrastructure investment plans |are part of a long-term strategy. Specifically, they are part |of the 21st Century Maritime Silk Road, as Greece is a |maritime hub connecting |the Middle East, the Balkans and Europe. 

China also has agreements with Hungary and Serbia to build railroad that will connect them with Greece and this will open up new transport connections with Asia.

If China’s plans come to fruition, this will certainly help support the recovery of the Greek economy.