The stalemate which threatened to sour relations between the government and Chinese shipping giant Cosco over the proposed expansion of the Piraeus Container Terminal (PCT) which Cosco operates seems to have been broken on Thursday thanks to an initiative by Prime Minister Antonis Samaras.
Two months ago, on the occasion of the inauguration of PCT’s new pier, Samaras announced that Cosco was planning an additional investment of 224 million euros to expand the terminal toward the western end of the port, saying that a memorandum had been signed by the Piraeus Port Authority (OLP) and PCT. A memorandum was signed that provided for the suspension of Cosco’s annual fee of about 70 million euros to OLP in order to facilitate the investment.
Negotiations, however, appeared to have been bogged down, threatening the government’s privatizations program, which includes OLP. Hours before the expiry of the second deadline for a detailed agreement yesterday, it was announced that a deal was at hand and official announcements are expected today.
Cosco will invest 224 million euros in a fourth pier, to the west of the port, which is seen considerably expanding its capacity. In exchange, OLP will consent to the suspension of the minimum annual fee for a certain period. This has not yet been determined but it is considered likely it will apply up to 2025, when Cosco estimates that the Greek economy will return to the level of 2009, when its original concession agreement with OLP was signed.
A big question mark concerning the deal hangs over the stance of the European Competition Commission, which has to green-light it. This was the main reason for the lack of progress in sealing the deal, as the Greek side feared that the Commission would be unfavorably disposed toward any amendment of the original contract signed in 2009, considering that this would amount to illegal state aid.
This hurdle is said to have been overcome through a legal formula, details of which will be made known on Friday.