COSCO in Piraeus shortlist
July 1, 2014 Category Logistics, Ports & sea transport
China Ocean Shipping (Group) Co (COSCO) has been shortlisted as a potential buyer to acquire a majority stake in Piraeus Port Authority, the largest port in Greece. The state-owned company will compete with four other companies, according to the Greek privatization agency Hellenic Republic Asset Development Fund (HRADF). COSCO is expected to submit its investment proposal after Athens decides what steps it wants to follow in the privatization of Piraeus and Thessaloniki. Piraeus Port is one of the largest seaports in the Mediterranean Sea basin and among the top 10 container ports in Europe. It has more than 1,500 employees and provides various services to more than 24,000 ships every year. COSCO faces stiff competition from APM Terminals and Ports America, Utilico Emerging Markets and International Container Terminal Services. Binding offers for the port are expected to be submitted by the bidders by the end of the year. Chen Yingming, Executive Vice President of the China Ports and Harbors Association, said that the shipping industry would continue to face tough times due to the stiff competition among international shipping giants. Strategies like forming alliances and offering lower shipping rates will affect the profitability of the sector in the long run, he said. COSCO Pacific, a subsidiary of COSCO Group, the fifth-largest container terminal operator in the world, has already made a substantial investment in Piraeus port. It spent €4.3 billion on a 35-year management lease for the No 2 and No 3 piers, which it has been operating since June 2010. The Chinese company invested an extra €230 million in 2013 to enhance the port’s cargo handling capacity over the next seven years, including building a new pier and almost tripling the volume of cargo that the port can handle. To help its port business in Greece, COSCO has started freight shipments for Hewlett-Packard and Huawei Technologies from its terminal in Piraeus port to destinations in the Czech Republic and Hungary, the China Daily reports.
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