COSCO's acquisition of Greek Piraeus Port to further contribute to local economy

China COSCO Shipping Corporation Limited, China's state-run shipping giant, entered into a deal with Greece's privatization fund HRADF on Friday to take over a 67-percent stake in the European nation's main port of Piraeus.

Under the deal, COSCO, the fourth-largest container shipping firm and second-largest port operator in the world, will pay the cash-strapped country 368.5 million euros (418.8 million U.S. dollars), and also promises to invest another 350 million euros (398.9 million dollars) over the next decade in infrastructure work at the port.

The agreement was signed by HRADF chief Stergios Pitsiorlas and COSCO Hong Kong CFO Feng Jinhua in the presence of Greek Prime Minister Alexis Tsipras, China COSCO Shipping Chairman Xu Lirong and Chinese Ambassador to Greece Zou Xiaoli at the office of the Greek Prime Minister.

COSCO'S VISION FOR PIRAEUS

According to Lloyd's List, a British daily covering maritime industries, Piraeus ranks third in port volume in the Mediterranean and is among the top 10 in Europe.

However, trapped in Greece's longstanding debt crisis, the Piraeus port had fallen into a mess with ships and containers piling up.

In 2008, COSCO won a container operation project for Piraeus port to manage Pier II and Pier III of Piraeus Container Terminal (PCT) for 35 years. In 2015, the port's capacity rose to 3 million containers, a dramatic increase from 685,000 in 2010.

By 2020, PCT officials expect that Piraeus' cargo handling capacity will reach some 6.3 million TEUs (20-foot equivalent unit) per year, making Piraeus the largest port in terminal capacity in the Mediterranean.

The Chinese enterprise has also created over 1,000 jobs for local people over the last two years. Among the incessant strikes around the country, workers at the port have never held a strike.

These have said that COSCO "has always been committed to harmonious development in Greece and to promote a win-win situation for all parties," said China COSCO Shipping Chairman Xu at Friday's deal-signing ceremony.

In five years of operation, COSCO aims to make the Piraeus port the south gate of the China-Europe land-sea express to speed up transportation between China and Europe, said Xu.

COSCO's vision to turn Piraeus into a leading international transit hub for products and services from Asia to Europe has already attracted other major multinationals at the port, which are cooperating with PCT to distribute their products in the region.

Greek officials, local business bodies and experts have repeatedly stressed that new investments in Piraeus will further boost the port's role as a key transit hub for products in the Mediterranean, create much-needed jobs in the recession-hit country, and breathe new life into the ailing economy by attracting more investors.

Greek Prime Minister Alexis Tsipras said Friday that the agreement offers an important opportunity for the two countries to develop a growth path that can benefit both countries.

"The agreement sends a strong message to the global economic community for the recovery of the Greek economy," he added.