Greek revival, Chinese dreams

The ancient Port of Piraeus by the city of Athens is still not only the largest Greek seaport, but also one of the top 10 container ports in Europe today. A major employer in the area, it has nearly 2,000 employees and services annually about 24,000 ships. With the natural advantage of its strategic potential, the Athenian fleet defeated the Persians here in 483 BC in the battle of Salamis. In the following years Themistocles initiated the construction of the port and created the ship sheds, while the Themistoclean Walls were completed in 471 BC, turning Piraeus into a great military and commercial harbour. However the Port of Piraeus went into a long period of decline, the harbours were only occasionally used by the Byzantine fleet and later the Ottomans. Then, it revived.

In 2007 the Port of Piraeus handled 20,121,916 tonnes of cargo and 1,373,138 TEUs making it the busiest container port in the Eastern Mediterranean basin. TEU stands for twenty-foot equivalent unit and is an inexact unit of cargo capacity used to describe the capacity of container ships and terminals. It is based on the volume of a 20-foot-long (6.1m) intermodal container, a standard-sized metal box, transferable between different modes of transportation, such as ships, trains and trucks. Piraeus’s container terminal has a storage capacity of 900,000 m2 and an annual traffic capacity of around 1.8 million TEUs. There are two piers in the terminal with a plan to add by 2015 a third one, which on completion will have a high density stacking system with a container capacity of 1,000,000 TEUs per year.

Plus there are three car terminals with a total length of 1.4 km, a land area of 180,000 m2, storage capacity of 12,000 cars and a trans-shipment capacity of 670,000 units per year. Before the slump in 2008 the automobile terminal handled 260,605 trucks, 612,840 cars, and 9,920 buses. Besides, the cargo terminal has a storage area of 180,000 m2 and an annual traffic capacity of 25,000,000 tonnes.

Piraeus got linked up with Athens railhead in 1869. Today railway holds the key to the huge hinterland called Europe that can connect to the continental rail system to transport goods to different parts of the continent. Therefore the emphasis is on developing a consonant rail network. Free shuttle buses inside the Port run from across the Metro Line 1 Terminal Station, around the north side of the port to the ships sailing for Crete and the Eastern Aegean. A direct Airport Express bus runs 24/7 between the port and Athens International Airport. 

Five years ago global shipping carrier Cosco, a Chinese State company, acquired the management rights of half of the port, after which business activity at Piraeus has tripled. About 6,000 containers are transferred daily through the terminal. China says that the Chinese and Greek economies are complementary. China has expressed interest also in the Port of Thessaloniki, Greece’s state-run railway network, and a majority stake in the other half of the port of Piraeus still under government control. Nearly five years into its worst economic crisis in living memory, Greece seeks investment, which can offset the 26.7% unemployment rate, the highest in the EU.

But the scenario of growth with hard work is not liked by the middle classes. Some say, they wanted a good life, more holidays and less work. And they spent money before they had it. Now they have many debts. The economic attack is, however, mainly on the workers. The two main foreign lenders, the International Monetary Fund and the European Central Bank, want to end protection for workers. Cosco is a blessing in this situation. Besides the $647 million that Greece received in return for leasing out half of the port of Piraeus to Chinese hands, the Greek government is also earning – in fact more income — from taxes as a result of the port’s pickup in business. Cosco’s operation is providing around 1,000 jobs to Greek workers — compared with the 800 or so who work in the Greek managed part of the dock. On Cosco’s portion of the port, cargo traffic has more than doubled over the last year, to 1.05 million containers. 

The other significant aspect of the situation is the geostrategic position of Greece. It is such that there is now possibility of development in the area of logistics around the port. Greek economic crisis has now helped focus attention on the potential benefits of being a regional transport hub in the way the Netherlands is in northern Europe. Logistical considerations suggest the possibility and importance of making Greece a transit route for goods. 

Think of the potential for rail network. With the 2013 agreement with the California-based HP, the Piraeus Container Terminal SA will move goods manufactured in Asia into Europe. This is possible as the government has completed a long-delayed 17 km link from the port to the national rail network. Logistical considerations also point to Piraeus’s potential to become a bigger trade gateway on the condition that there is further development of the Greek railway network and greater synchronisation of port and rail links in the country, highways, and regional airports. 

Clearly the re-emergence of Piraeus as a port is due to a significant measure to the fact that Piraeus fits nicely with China’s logistical expansion plan. Last Tuesday, as I was returning from Athens, China’s state-owned Xinhua News Agency unveiled a series, “New Silk Road, New Dreams.” The first article was titled, “How Can the World Be Win-Win? China Is Answering the Question”. Apparently the “New Silk Road” and “New Maritime Silk Road” will be the answers.

The writer is Director, Calcutta Research Group
This is the first in a two-part series by the author The second part will be published tomorrow