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New Greek govt moves to calm Chinese fears over port privatisation halt

New Greek govt moves to calm Chinese fears over port privatisation halt
The new Greek government has moved quickly to try and douse China’s concerns over the decision to halt privatisation of the Piraeus and Thessaloniki ports.

“We are highly concerned about this,” Chinese Commerce Ministry spokesman Shen Danyang said 29 January, three days after the radical coalition government of Alexis Tsipras, was sworn in.

“We plan to ask the Greek government to protect the rights and the legal interests of Chinese companies in Greece, including Cosco,” said Shen.

China sees Piraeus as a vital to its plans to move exports into central and eastern Europe. Further, a number of Chinese companies have established in Greece to better facilitate the movement of containers by rail into Europe.

Shipping giant Cosco and its port operating arm Cosco Pacific was one of the five international companies left in the tendering process launched last year linked to the sale of the 67% stake the state holds in the Piraeus Port Authority.

First reaction to the decision came from China’s Foreign ministry. “Since the Cosco Group won the concession to expand the second and the third container terminals at the Piraeus port [2009], Cosco's project has become a good example of a project of mutual benefit, a win-win cooperation, thanks to the concerted efforts of the two sides. China believes the Chinese government and the Greek government are willing to go hand in hand to advance practical cooperation in an all-round way and deliver benefits to the two countries and their peoples,” said the Chinese Foreign Ministry spokesperson, Hua Chunying.

Incoming Economy Minister George Stathakis and Alternate minister for Shipping Theodoris Dritsas, met January 29, with representatives from the Chinese Embassy in Athens, led by ambassador Zou Xiaoli. The Shipping Ministry said the meeting “confirmed the common positions of both sides for the upgrading of relations between Greece and China on multiple levels,” with an agreement “for the promotion of a constructive dialogue to strengthen cooperation.”

Further, representatives the local subsidiary of Cosco, Piraeus Container Terminal (PCT) do not seem too phased by the election result. "Nothing of what the members of the new government have said disputes the concession and the recently approved amendment to the contract, concerning the investment of Euro 230m in the construction and operation of the western part of terminal III.”

Indeed, a PCT source has been quoted as saying, “on the contrary, [Athens] spoke of the government’s respect for the contracts and obligations the Greek state has undertaken".

Still, both Stathakis and Dritsas have stated they may review the agreement with Cosco, but did not say if they would renegotiate with the Chinese company, adding there is an “open horizon” of cooperation with Beijing.

Even before being sworn-in Dritsas said “the public character of the port will be maintained”. The PPA is listed on the Athens Stock Exchange and investors also seem confused about what lies ahead. With the initial announcement the stock price declined some 18% but after the re-assurances it recovered and was up 3.4% over the week.