Greece’s government has turned down a proposal by China’s Cosco to expand its containership terminal in Piraeus.
“Conditions at the current juncture are not ripe to implement the specific project,” Greece’s shipping ministry said in a statement.
Cosco already operates three containership piers at Piraeus with an annual handling capacity of 7.2m teu per year. The Chinese company had proposed to add a fourth pier nearby, to boost Piraeus’s capacity to 10m teu. The move would have bolstered the port’s position as one of Europe’s top ten biggest containership terminals.
Cosco, under whose management the boxship port has flourished over the past few years, said it hoped the government would change its mind. “We’d like to believe that authorities will soon review the expansion,” said Yu Zenggang, chairman of the Piraeus Port Authority (OLP).
Local labour unions vowed to thwart the expansion plan, fearing it would have come at the expense of ship repair activity in the area.
OLP planned to build the fourth containership pier at Irakleous port, the current site of its car terminal. The car terminal, in turn, would move further west to Keratsini and Drapetsona, two working-class Piraeus suburbs with a rich ship repair culture.
“Half the ship repair zone would shut down,” workers said in a statement calling for a rally outside the shipping ministry, just when government officials were discussing Cosco's plans.
Local labour unions have long been at loggerheads with Cosco over wages and labour conditions. That is ironic, considering that the labour unions are under the influence of Greece’s communist party while Cosco is controlled by Communist Party-led China.
Cosco's fourth boxship pier was part of a wider multi-million euro investment plan, most of which got government approval. Cosco is to spend €611m ($675m) over a series of years to upgrade Piraeus’s passenger and cruiseship facilities, as well as of its car terminal and the ship repair zone.
Approval of the fourth boxship pier would have boosted Cosco's investment bill to about €800m.
About €300m of Cosco's investments are mandatory under the terms of a 2016 privatisation deal that saw the Chinese company acquire a 51% stake in OLP for €281.5m. Provided investments proceed as planned within five years, Cosco will increase its OLP holding by a further 16% at a price of for €88m.
