Greek ports and geopolitics

With Piraeus controlled by the Chinese, US interest turns to the privatization of Volos

Greek ports and geopolitics

In the early 2010s, Greece, burdened by debt and facing bankruptcy, had to agree to an intensive schedule of privatizing critical infrastructure, especially its ports.

At that time, the priority among Greece’s creditors, the European Union among them, was to manage the debt crisis and ensure that Greece would pay back its debts. Only a few perceptive analysts could foresee that Turkey’s reliability as a NATO ally would be questioned, or that Russia would initiate a bloody war in Ukraine. And while the US-China competition was evident, its extent and hostility were nowhere near today’s levels.

Greece’s two largest ports, Piraeus and Thessaloniki, have since been privatized. Piraeus was acquired in 2016 by China’s COSCO, which easily saw off a rival Danish bid. Two years later, Thessaloniki was acquired by a consortium and eventually fell under the control of Greek-Russian oligarch Ivan Savvidis, a former MP in the Russian Duma.

First to raise objection about the Chinese investment were Piraeus’ Northern European competitors, who rightly feared losing their share in the overseas Chinese shipping trade.

Even though the Greek state remains a minority shareholder in both ports, Western countries see them in the context of an increasingly intense geopolitical rivalry. Especially since their commercial activity is far from negligible: Piraeus is now the top Mediterranean container port, and Thessaloniki, closer to important Balkan and Central European markets, is also significant.

Former US ambassador of Greece Geoffrey Pyatt had clearly articulated US interest in the country’s ports. And, in the US Senate hearing ahead of his confirmation, current Ambassador George Tsunis had clearly stated that the US should not have let a Chinese group take control of a strategically important port such as Piraeus.

US interest turned to the ports of Alexandroupoli and Volos. With the Greek government having weathered its debt crisis and canceling the Alexandroupoli port’s privatization, Volos is now the main prize. US state entity Development Finance Corporation (DFC) is actively supporting one of the four bidders.

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