Big plans in store for Piraeus . . .
This week Chinese President Xi Jinping visited Greece, during which time Beijing and Athens signed 16 agreements, most notably a Chinese investment of 600 million Euros in the Port of Piraeus, part of a plan to turn it into the largest port in Europe. It was also agreed that COSCO Shipping, a Chinese state-owned enterprise currently holding a 51 per cent stake in the port, could be allowed to purchase an additional 16 per cent by 2022.
Chinese investment in Greece expands beyond ports . . .
In addition to economic collaboration around Piraeus, the Bank of China and Industrial and Commercial Bank of China will open branches in Greece with the intention of investing in Greece’s maritime industry, renewable energy, and real estate sectors. In addition, the State Grid Corporation of China will invest in a new electricity interconnector between mainland Greece and the island of Crete, which is expected to become a solar energy hub.
Tense strategic competition, or sound economic development strategy? . . .
Geostrategic analysts tend to see Chinese investment in Greece as one component of a larger bid to increase China’s access to and control over key shipping hubs in the Mediterranean, including in Egypt, Israel, Italy, and Morocco. If they are correct, Greek authorities are shrewd geostrategic negotiators; in September, they permitted the U.S. to open three new military bases in the country. Yet, perhaps Chinese investment is especially attractive to Greece as part of a sound economic development strategy, luring much-needed investment to an anemic economy. The expansion of the Port in Piraeus has created 10,000 local jobs since COSCO Shipping’s investment in 2016 and the European Investment Bank provided a loan of 140 million Euros to help COSCO Shipping with the infrastructure upgrade in Piraeus. Perhaps local economic development policies and foreign investment can co-exist.
- European Investment Bank: Greece: EUR 140 million EIB backing for Port of Piraeus transformation
- Global Research: Greece as the centerpiece of China’s BRI in the eastern Mediterranean
- Reuters: China, Greece agree to push ahead with COSCO’s Piraeus Port investment