Greek government courts Chinese shipyard investors

The Greek government is understood to be using the occasion of Posidonia 2014 to arrange a meeting with Chinese investors, including leaders of the shipbuilding industry, in an effort to generate their interest in investing in Greek shipyards.

Several Greek ministries are involved and plan to meet a Chinese delegation a few days before the 2 June opening of the week-long Posidonia exhibition. Greeks are leading clients of the Chinese yards, and over 70 Chinese shipyard-related companies will have a presence at the exhibition.

The meeting will not be the first between Greek officials and Chinese investors, especially the shipyard sector. Seatrade Global understands at least one of the Chinese principals has been looking at shipyard rivals in the region, with particular attention being paid to Turkey’s Tuzla, to get a feel of the competition.

The Greek side will play on the success of the concession agreement Cosco Pacific has to run two container terminals in Piraeus. This success will no doubt also bring more Chinese ships into the region, which could use Greek shiprepair facilities.

Greece’s Hellenic Shipyards, one of the largest yards in the Mediterranean has been virtually closed for months, while Elefsis Shipyards has had limited activity, and once thriving Perama Repair Zone is near death.

Courting of the Chinese shipyard men comes as Cosco Pacific establishes itself as the frontrunner in bidding to buy control of Piraeus port, though some of the world's most prominent terminal operators have declared interest in the majority stake in Greece's largest port.

The Hellenic Republic Asset Development Fund (TAIPED), the agency leading the country’s privatisation programme, says industry terminal specialists APM Terminals and Cosco (Hong Kong) Group, along with Philippines-based port operator International Container Terminal Services (ICTS) and Ports America Group Holdings, the biggest terminal operator and stevedore in the US, the Peter Yu-led Cartesian Capital Group and UK-listed investment company Utilico Emerging Markets, are the parties to express interest.

At stake is the state’s 67% holding in Piraeus Port Authority which is listed on the Athens Stock Exchange and has a market capitalisation of about Euro 460m ($635.7m).

Cosco’s Piraeus Container Terminal handles the lion’s share of the port’s 3.164m teu container traffic, under a 35-year concession lease agreed in 2009 and became operable in 2010.

However, while the government is desperate to have a deal in place by the end of the year, opposition is growing and includes the administrative leadership of the port, municipal authorities, shipowners, members of the Piraeus cluster and the international cruise sector.

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