Bruce Barnard, Special Correspondent | Jun 26, 2012 11:43AM EDT
Hong Kong’s Cosco Pacific, operator of the biggest container terminal in the Port of Piraeus, Greece, is considering further investments in the country as the cash-strapped Athens government prepares to sell ports as part of a radical privatization program.
The port operating arm of China Ocean Shipping is conducting an in-depth feasibility study of the planned $62 billion privatization program, said Fu Chengqiu, managing director of the Piraeus container terminal.
“We are waiting for the formation of a new government to make further decisions,” Chengqiu told the China Daily newspaper.
Cosco Pacific, which operates Piraeus’s Pier 2 container terminal, is weighing an investment in the Piraeus Port Authority that would give it a stake in the Pier 1 container terminal as well as handling cruise lines, ship maintenance and coastal real estate.
The Greek government is planning to privatize the port authorities of Piraeus and Thessaloniki, but progress is slow.
Cosco Pacific may also invest in a $350 million logistics center approximately 20 miles from Piraeus.
Cosco Pacific has made contingency plans for a possible Greek exit from the eurozone, Chengqiu said. “We have completed several packages of solutions which are prepared for the worst situation.”
Cosco faced a backlash from Greek dockworkers against its 35-year concession to operate the Piraeus container terminal, which it took over in June 2010 after signing a $4.3 billion contract.
“We have not only survived but have also broken historic records in handling containers,” Chengqiu told the China Daily.
Cosco Pacific, which pays $125 million a year to operate the Pier 2 terminal, handled 870,000 20-foot equivalent units in the first five months of 2012. It handled 1.18 million TEUs in 2011, more than double the 500,000 TEUs at Pier 1, which is controlled by the Piraeus Port Authority.
The company expects total traffic in Piraeus to hit 2.1 million TEUs in 2012. “Though the (eurozone) crisis and uncertainties are still unfolding, we think this is a realistic target for us,” Chengqiu said.
Cosco Pacific plans to boost Piraeus’s capacity to 3.7 million TEUs a year and transform it into a leading Mediterranean hub for Chinese exports to Europe.
The company is currently upgrading the Pier 3 terminal into a deep-sea facility able to handle the largest container ships of up to 18,000 TEUs.
Contact Bruce Barnard at brucebarnard47@hotmail.com.
