Disir
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In mid-2016 the Chinese ocean shipping company COSCO succeeded in acquiring a controlling stake in the Greek port of Piraeus. This was the culmination of more than a decade of preparation and prior part ownership, and it represents an important piece in the complex jigsaw of China’s One Belt One Road internationalization strategy linking Europe with Eurasia. Along the way there were major setbacks, and in particular a narrowly avoided ejection of COSCO from Piraeus by the newly elected Syriza government, the far left government elected in Jan 2015 by a Greek people exhausted by the austerity imposed by European creditors. This threatened ejection was narrowly avoided by a more comprehensive set of negotiations, which would have seen China funding the Greek government through purchase of its Treasury bills – thereby enabling the Greeks to get around sanctions being imposed by the European Central Bank.
China’s entry to Europe via Greece, putting in place an essential piece in Beijing’s greater One Belt One Road strategy, must rank as one of the most delicious episodes of blowback in recent history. Institutions like the European Central Bank (ECB) can take sole responsibility for strangling Greece. It was deaf to all pleas for a constructive engagement and restructuring of the debt – as told vividly by Yanis Varoufakis, former Finance Minister of Greece who lived through the entire shameful episode, in his recently published memoirs, Adults in the Room. But as the EU institutions applied the pressure, so they fostered a determined effort on the part of the Greek government to slip the noose. This was done most effectively by allowing China Ocean Shipping Company (COSCO) to purchase a majority stake in the port of Piraeus. What had started as a demand by the European institutions that Greek public assets be privatized in a ‘fire sale’, became the means to allow China to penetrate Europe’s defences, and build a major transport hub – encompassing rail, road and sea – linking Europe with Eurasia.
While Varoufakis was forced to resign his ministerial position in July 2015, his actions in helping to bring the Chinese and Greek authorities together have borne abundant fruit. While the Chinese had expressed interest in modernizing and expanding Piraeus as far back as 2008, when COSCO acquired a part stake in Pier II at Piraeus, by the time the Syriza government was elected in Jan 2015 there was a real danger that the new ministers would respond to populist pressure and expel the Chinese. Varoufakis describes how he was able to get past these entrenched positions, and create the foundations for a relationship between China and Greece that would give Greece a ‘Get out of Jail’ card from the debtor’s prison imposed by the Europeans.
What happened is a matter of public record. In mid-2016 COSCO was authorized by the Greek government to purchase an initial 51% stake in the Piraeus port, at a cost of $316 million, to be followed by a further 16% stake within five years, at a further cost of $99 million. (For background, see ‘How a Greek port became a “dragon head”’ by Andreea Brinza, The Diplomat, April 25 2016). So much has been on the public record. But Varoufakis’ memoirs flesh out the story, and add further details that reveal what a clear case of blowback this is.
China’s Takeover of the Port of Piraeus in Greece: Blowback for Europe | The Asia-Pacific Journal: Japan Focus
This is a lengthy read but very interesting.
China’s entry to Europe via Greece, putting in place an essential piece in Beijing’s greater One Belt One Road strategy, must rank as one of the most delicious episodes of blowback in recent history. Institutions like the European Central Bank (ECB) can take sole responsibility for strangling Greece. It was deaf to all pleas for a constructive engagement and restructuring of the debt – as told vividly by Yanis Varoufakis, former Finance Minister of Greece who lived through the entire shameful episode, in his recently published memoirs, Adults in the Room. But as the EU institutions applied the pressure, so they fostered a determined effort on the part of the Greek government to slip the noose. This was done most effectively by allowing China Ocean Shipping Company (COSCO) to purchase a majority stake in the port of Piraeus. What had started as a demand by the European institutions that Greek public assets be privatized in a ‘fire sale’, became the means to allow China to penetrate Europe’s defences, and build a major transport hub – encompassing rail, road and sea – linking Europe with Eurasia.
While Varoufakis was forced to resign his ministerial position in July 2015, his actions in helping to bring the Chinese and Greek authorities together have borne abundant fruit. While the Chinese had expressed interest in modernizing and expanding Piraeus as far back as 2008, when COSCO acquired a part stake in Pier II at Piraeus, by the time the Syriza government was elected in Jan 2015 there was a real danger that the new ministers would respond to populist pressure and expel the Chinese. Varoufakis describes how he was able to get past these entrenched positions, and create the foundations for a relationship between China and Greece that would give Greece a ‘Get out of Jail’ card from the debtor’s prison imposed by the Europeans.
What happened is a matter of public record. In mid-2016 COSCO was authorized by the Greek government to purchase an initial 51% stake in the Piraeus port, at a cost of $316 million, to be followed by a further 16% stake within five years, at a further cost of $99 million. (For background, see ‘How a Greek port became a “dragon head”’ by Andreea Brinza, The Diplomat, April 25 2016). So much has been on the public record. But Varoufakis’ memoirs flesh out the story, and add further details that reveal what a clear case of blowback this is.
China’s Takeover of the Port of Piraeus in Greece: Blowback for Europe | The Asia-Pacific Journal: Japan Focus
This is a lengthy read but very interesting.
