China’s Cosco Group has received approval from the board of directors of the Hellenic Republic Asset Development Fund (HRADF) for its bid to acquire 67% share of the Greek Port of Piraeus (OLP).
Subject to the competent authorities’ approvals, the transaction involves Cosco pledging a revised amount of €368.5m to assume the ownership of 67% of the Greek port over a period of 40 years, the whole process is expected to be completed in May.
Cosco additionally will invest €350m in the port over a period of ten years.
Greece’s Foundation for Economic and Industrial Research anticipated that the strategic shift of business would generate $5.5bn each year to the economy, as well as create 125,000 jobs, according to maritime-executive.com.
Cosco seeks to change the Port of Piraeus into an international transit hub for products and services from Asia to Europe.
The bidding process has happened against the backdrop of strikes organised by the Panhellenic Seamen’s Union, opposing the government’s anticipated austerity measures which involved the consolidation of shipping workers’ social security funds into a single national insurance body, and privatisation of the country’s ports, Piraeus and Thessaloniki.
Economist Dimitris Karousos was quoted by Truthout as saying: "These privatisations will be catastrophic for Greece.
"None of the income that is earned from the privatisations enters the economy.
"It is instead earmarked for the repayment of interest and the debt, required by law to be transferred within 10 days to a special account used exclusively for the repayment of the national debt."
The privatisation of the port was opposed by the left-wing government early last year.
It had sparked controversies and strikes as the port workers experienced job losses and higher export cost for Greek products.
However, Greece again plans to auction 67% share of the Thessaloniki Port Authority, considering eight groups as potential bidders in 2014.
Image: A cruise ship moored at the Port of Piraeus. Photo: courtesy of HG32.