China's COSCO hopes for Greek deal on Piraeus despite delay -official

Piraeus Port Authority SA

28/05/2021 14:06

By Angeliki Koutantou
    ATHENS, May 28 (Reuters) - Chinese shipping group COSCO
hopes to reach a deal with the Greek government to complete the
purchase of an extra stake in Piraeus, despite running out of
time to fulfil a key condition, a top official at the port said.
    Under a 2016 Greek privatisation agreement, COSCO Shipping
 601919.SS  bought a 51% holding in Piraeus Port Authority (PPA)
 OLPr.AT  for 280 million euros ($341 million) and committed to
mandatory investments worth about 300 million euros over five
years to acquire an additional 16% stake.
    COSCO has signed contracts for the majority of these but
will not be able to conclude them by August when the deadline
expires due to delays beyond its control, a senior official at
PPA, which manages the port, told Reuters. 
    "We believe that the spirit of the agreement should be
respected and the shares should be transferred, while PPA
remains committed and implements the investments as they have
been agreed," the official said on condition of anonymity. 
    "Both sides are willing to find a constructive solution
regarding one of the biggest foreign investments in Greece."
    The government referred to a statement by Deputy Finance
Minister Theodore Skylakakis to lawmakers this week which said
that seeking solutions "in good faith and through dialogue" has
been in Greece's interest.
    A significant component of COSCO's mandatory spending is
upgrading a cruise terminal for more large ships to dock and
help tourism-reliant Greece attract more visitors.
    But only months after starting, COSCO suspended work last
year following an appeal by locals over environmental concerns.
The official was optimistic of a positive ruling for COSCO.
    Piraeus has grown into a major transhipment hub for goods
destined for Mediterranean and Black Sea ports since COSCO took
over its container operations in 2009 and spent about 600
million euros in infrastructure and equipment upgrades.
    Container throughput reached 5.4 million TEUs (20 foot
equivalent unit) last year, up from about 1 million TEUs in
2009, making it the fourth-busiest port in Europe behind Antwerp
and Hamburg.
    COSCO says that Piraeus has the potential to handle more
cargo and has sought government approval for a 200 million euro
investment into a new container terminal, which could boost
capacity to 11 million TEUs from 8 million TEUs this year.
    Although Athens has said that conditions are not yet right,
the PPA official said it was an important investment which they
expected to eventually get government approval.
($1 = 0.8204 euros)  

 (Reporting by Angeliki Koutantou; Additional reporting by Tom
Daly; Editing by Alexander Smith)
 ((angeliki.koutantou@thomsonreuters.com; +30 2102214608;
Reuters Messaging: angeliki.koutantou.reuters.com@reuters.net))