Archaeology could consign Cosco Shipping's Piraeus port plans to history

While Cosco Shipping’s massive investment plan for the port of Piraeus is not yet ancient history it is certainly under threat of becoming part of Greece’s modern history.

fter a lengthy meeting that went on until midnight 2 April, Greece’s powerful Central Archaeological Council (KAS) struck a major blow to the Cosco-owned Piraeus Port Authority’s (PPA) $675m master plan by characterising a large part of Piraeus as an area of archaeological interest that must be protected.

KAS voted unanimously against plans by the Chinese multinational to construct a mall next to a new cruise ship terminal. KAS also called for restrictions on a five-star hotel set to be built in the southern section of the central port where the main cruise terminal is located.

Also the ability to operate a 300,000-tonne capacity dry dock at the industrial Psyttalia site is under a cloud. Additionally, extending the archaeological zones offshore raises questions over whether the state bureaucracy, KAS in this case, will interfere with dredging off the passenger port of Piraeus.

The decisions put relations between the Chinese multinational and the government to another test as Cosco sees its master plan as an integral project and not isolated interventions, while Beijing views Cosco’s plans as part of the process for a new Silk Road that will consolidate China’s global financial power.

KAS’ decision is expected to result in a major delay of at least eight months for the start of implementation of any of the investments planned, according to Cosco sources. Those eight months will add to the two-and-a-half years of delays since the PPA was privatised. 

Indeed, Cosco has effectively become a hostage to the Culture Ministry, which appoints KAS members, with a clear impact on the time of investment implementation.

The additional investments are necessary for Cosco, as it says “there can be no major commercial port without a railway link and modern logistics facilities; there can be no ship repair zone without major tanks and high-standard services”.

However, the KAS decision was not unexpected. A KAS session, initially set for March 5, was postponed after an outcry, mostly by municipalities, and a written request by the PPA's management, asking for more time to respond to the prospect of declaring one of two of Greece's most industrialised districts as an area of archaeological interest, a prospect that would mean stricter building license regulations and land uses.

The prospect of most or parts of their municipalities falling under the Culture ministry-affiliated but semi-autonomous KAS' zoning guidelines also generated a sharp reaction by local mayors, including the municipal leadership of Piraeus.

A PPA spokesman told Seatrade Maritime News the PPA considered the decision a 'blow' but not a 'knock-out'. He said the port's management has already presented a new master plan to a Shipping and Island Policy ministry-led committee, which comprises some 10 interested parties, including the Culture ministry, with a view to re-submitting a new master plan. 

This is reportedly backed by Greece's privatisation agency Taiped. The PPA could also seek recourse to the Council of State and request the cancellation of the KAS decision. It could go to arbitration, whereby Cosco will activate its option to purchase another 16% of the PPA's shares worth some EUR88m regardless of the progress of proposed projects. Cosco would then maintain that delays in implementing the master plan are not its responsibility.

Posted 05 April 2019

© Copyright 2019 Seatrade (UBM (UK) Ltd). Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Seatrade.

David Glass

Greece Correspondent, Seatrade Maritime

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