Greece Seals Sale of Piraeus Port to COSCO

Posted by Joseph Keefe April 8, 2016

Greece is to sell its biggest port Piraeus Port Authority to shipping group China COSCO Shipping Corporation, marking the second major privatisation for the country since late last year.

The port sale had been halted by the leftist government of Alexis Tsipras when it won elections in January last year but it was resumed under Greece's 86 billion-euro bailout deal agreed with its euro zone partners in August.

On Friday, striking dockworkers marched in central Athens to protest against the sale, which they fear will put their jobs at risk. Container terminals were shut as a result of the strike. Brief scuffles broke between police and some of the protesters.

Under the 368.5 million euro deal, signed on Friday by China COSCO with the Greek privatisation agency, COSCO will buy 51 percent of Piraeus Port for 280.5 million and the remaining 16 percent for 88 million after five years and once it concludes investments of 350 million over the next decade.

The total value of the contract is 1.5 billion euros ($1.70 billion), including additional investment, as well as revenues of 410 million euros, dividends and interest Greece is expecting to collect under the 36-year concession deal between Piraeus Port and the government.

Privatisations, a major element of Greece's bailouts since 2010, have produced revenue of only 3.5 billion euros so far because of political resistance and bureaucratic hurdles.

Athens concluded a 1.2 billion euro airport leasing deal with Germany's Fraport in December hoping this would help the country meet this year's target for privatisation proceeds of 1.9 billion euros for this year.

In January, Greece named COSCO as the sole bidder for Piraeus Port. he port, a gateway to Asia, eastern Europe and north Africa, handled 16.8 million passengers and 3.6 million 20-foot equivalent units (TEUs) of containers in 2014.

COSCO has been operating one of the port's container terminals since 2009 and is investing 230 million euros to build a second container terminal at the port.