Greece To Sell Two Ports as Part of Bailout
The government of Greece will be selling its stakes in the ports of Piraeus and Thessaloniki as part of the bailout agreement with the European Union. The $94 billion bailout, Greece’s third in five years, requires the country to sell $55 billion of state-owned assets to pay down debt.
Both ports have been put on the auction block as part of earlier bailout efforts but deals were never closed. Proposed investments from Hong Kong’s Hutchison Port Holdings in Thessaloniki fell through in 2008 as the deal ran head-on into the global financial meltdown.
Piraeus is currently majority state-owned with China’s Cosco operating two of the port’s three cargo piers. Thessaloniki has attracted the attention of several companies, including APM Terminals and International Container Terminal Services. APM Terminals, International Container Terminal Services, and Cosco are all said to be considering deals involving the port of Piraeus.
Cosco Pacific is considered the favorite to take over Piraeus, based on its performance at the port over the last five years. Annual traffic at the port exceeds three million TEUs.
Greek dockworkers staged strikes to protest the award of a 35-year concession in Piraeus to Cosco Pacific in 2009. They haave sinced condemned talk of the privatization of the Piraeus and Thessaloniki port authorities in 2011, and are expected to move against the current efforts as well.
Greek shipowners, who control 4,200 ships worldwide, a fifth of the world’s fleet, are expected to pony up with higher taxes as part of the bailout deal. The industry pledged to pay an extra $460 million in taxes over the next four years in a deal struck with the previous government that was ousted in January.
The Greek government is expected to announce binding bids for the ports in October.