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Greece, China, Pireaus

Greeks look to China to save economy after row over harbour selloff

View of the Piraeus Container Terminal, near Athens, Greece
View of the Piraeus Container Terminal, near Athens, Greece Reuters

Greek Prime Minister Alexis Tsipras starts a five-day visit to China on Saturday. He was to meet his Chinese counterpart Li Keqiang and talk about trade and foreign investment. The Greek leader is looking east for help to get his country out if its economic dire straits. But there has already been a glitch over a Chinese company's partial takeover of the Piraeus harbour.


China's container shipping company Cosco is currently the largest foreign investor in Greece and eying a 67 percent takeover of its major harbour, Pireaus.

But the process has not been easy.

The deal has been years in the making. Greece sealed the sale of Piraeus Port Authority to China Cosco Shipping Corporation in April.

Athens saw the transaction as a major step for the bailed-out country in meeting international creditors' demands that it step up privatisations.

Under the 368.5-million-euro deal, Cosco will buy 51 percent of the Piraeus harbour for 280.5 million euros.

If 350 million euros of investments have been completed in five years, another 16 percent of the port may be obtained by the Chinese company.

But just this week, days before the Greek parliament was supposed to vote on the deal, the Greek side unilaterally changed the contract. They wanted, among other things, to add more guarantees for workers.

Cosco protested and on Friday, the day Tsipras was leaving for China, the contract was changed back to its original form and approved by a majority of the parliament; leaving Tsipras free to face Beijing without embarrassment.

The deal “provides jobs and income for the country,” says Thanos Dokos, director of the Hellenic Foundation for European and Foreign Policy Eliamep thinktank in Athens. “And, most importantly, it is a symbolic value of the investment.

“Greece is in dire need for foreign investment. We haven't had much luck so far. The fact that they met a company from the world's number two economic superpower is making a strategic decision to invest in Greece, is symbolically an important move. Hopefully others would follow."

NGOs such as China Labour Watch and the Hong Kong-based Students and Scholars Against Corporate Misbehaviour point out that China does not have a brilliant track record on labour rights and Greek trade unions are not happy with the deal.

“For the moment they are civil servants,” says Thanos Pallis, a former secretary general for Ports and Port Policy of the Ministry of Development, Competitiveness and Shipping.

“That means they have a job for life. And in the Greek economy, which has many problems, this is nice to have when almost 25-30 percent of the people is unemployed.

“In the private sector there are obviously rights but there is not this lifelong security. That changes quite a lot the situation."

But concessions have to be made if the Greek harbour wants to retain its competitiveness, argues Dokos.

“You can't have the cake and eat it at the same time,” he says. “If the country agrees that we need foreign investment to kick start the economy again, then one has to make some kind of compromises.

“And of course there are ways to protect jobs and any other concerns may be adressed.”

Dokos thinks the problems are “a bit blown out of proportion by either the labour unions or local societies. But I'm sure that solutions can be found.”

And some solutions were found indeed.

“There have been strikes here that lasted almost a month,” says Pallos. “Dockworkers took part in them but also people who work for the administrative or technical departments of the port."

The government has agreed to transfer them to other public-sector jobs.

But the Greek government may not be able to prevent people now hired by Cosco being forced to work under worse conditions and lower pay than those who have been transferred to the public sector. 

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