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Hard times before PM flies to China: COSCO Greece says key elements of Piraeus Port deal altered

Chinese Shipping corporation COSCO Greece objected on Wednesday to terms submitted to parliament for the sale of Piraeus Port to China COSCO Shipping, saying they were inconsistent with those previously agreed with the Greek privatization agency TAIPED. COSCO blames Greece for amending the original Piraeus Port deal agreed between the two sides on April 8th, saying that “key elements of the deal appeared to have been altered”.

According to Reuters:

Greece sealed the sale of Piraeus Port Authority (OLPr.AT) to China COSCO Shipping Corporation (601919.SS) in April, a major step for the bailed-out country in meeting the demands of international creditors that it step up privatizations.

Under the 368.5 million euro (£298 million) deal, COSCO will buy 51 percent of Piraeus for 280.5 million euros and the remaining 16 percent for 88 million after five years and once it completes investments of 350 million euros over the next decade.

The terms of the deal were submitted by the country’s shipping ministry to parliament for approval on Tuesday. But, COSCO Greece said in a letter to lawmakers seen by Reuters that key elements of the deal appeared to have been altered.

“The content of the specific plan is a complete reverse of what was agreed between COSCO HK and TAIPED (HRADF),” an email sent by COSCO Greece said, referring to the country’s privatization agency.

It said that ‘key terms’ on which COSCO’s offer was based, had been erased. It included an obligation by the state to approve project licensing within a specific timeframe.

A lack of such guarantees, the COSCO note said, would have materially affected the amount it bid for the project, and possibly affected the submission of a bid altogether.

Shipping Minister Theodoris Dritsas acknowledged that there were differences, but said the government had the right to make changes and the ministry was willing to make improvements. “The government will look into it, it will look into the objections and will probably consider making improvements,” Dritsas told lawmakers. (full story)

According to sources from the Shipping Ministry, changes were necessary so that there would e “adjustment to Greek legislation.” Cosco’s objections were not related to “such hot issues like the workers’ rights  but to “pricing issues,” the same sources said.

Among the changes cited by the Chinese company was the obligation of the Greek state to approve licensing for projects within a 90-day time frame. Removing this from the bill, the company said, would affect the amount it bids for a project and could also discourage the submission of a bid. Another issue raised by COSCO, that the stating that labor laws governing private companies will also apply to OLP was removed.

Left-wing Dristas was against the sale of Piraeus Port ever since he became a minister. Some Greek media rpeort that the Prime Minister was not aware of the changes and that Dritsas acted ‘unilateral’.

The Greek government has to hurry up with the changes of the changes as Prime Minister Alexis Tsipras starts his official visit to China, tomorrow, Thursday, July 1st 2016. And he could find a Small Wall of China raised right outside the airplane doorstep.

PS It’s not fun to play games with the former communist now neo-liberal Chinese.

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  1. Giaourti Giaourtaki

    The new route in Panama just opened

  2. It is not fun to break a given promise (=signed contract). Has nothing to to with neoliberal or what not. If you break a given word, you are not only a dirty liar but show the whole world, that you are not trustworthy.

    I am not a friend of this government and have never been. But rarely has something pissed me off so badly. Every Euro that is sent or spent on order to get Greece out of the slump it is in is useless, until this moron may play on in Athens. If he and his comrades still think they are so smart they could fool the world, the world should dump them. End of story

    • Giaourti Giaourtaki

      Anything that keeps these communist-capitalist-communist bloodsuckers from dictatorship-countries under control or even out is worth a try, harbours are infrastrucure that shouldn’t be sold.
      What happens otherwise we’ve seen in Idomeni, the port of Koder bribed so long the governments in Vienna, Budapest, Fyrom aso until the Balkans were closed and so everybody ships to Slovenia instead of Pireus.

      • Sorry, some problems understanding here

        What happens otherwise we’ve seen in Idomeni, the port of Koder bribed so long the governments in Vienna, Budapest, Fyrom aso until the Balkans were closed and so everybody ships to Slovenia instead of Pireus.

        I would not be aware, that governments can decide, where to ship goods. This is in the hands of transport business and businesses in general. And: “Everyone ships to slovenia”. Can I please see statistics showing the change of turned over tonnage in the mentioned harbours?

        Thank you

        • Giaourti Giaourtaki

          Is this a joke or what? Everybody knows when statistics get published… Just ask the port-authorities, where do you think will goods go when the tracks for the railway are blocked for months? Ask Trainose, may be they’ve details or directly at COSCO as they plan also to have a fast-train-track up to Beograd.

  3. Niels Kadritzke has a great article in this month’s Le Monde Diplomatique on the sell-off of Greece’s public property including the port of Piraeus. It outlines in great details the conditions under which these properties are being sold off. The concessions that are being imposed on Greece go far beyond anything most people would have imagined. Among others: two third of the concession fee agreed to between Cosco and the Greek State (for a total of €35 millions) are to be paid back to the majority owner of the port of Piraeus – in other words…Cosco. Add to that the clause that protects Cosco for a period of 5 years from any and all sanctions if it fails to abide by the terms it has agreed to. And so on and so forth. Bear in mind though that what has happened with Cosco is nothing in comparison with what Freeport (in coordination with Copelouzos) have managed to impose on the state for the purchase of the14 Greek regional airports. Leaving aside the fact that the “technical consultant” of the Greek state for the sale is Lufthansa Consulting which belongs to Lufthansa which participates in Freeport (conflict of interest anyone?) we find other interesting conditions in the details of the sale: Freeport will pay no local or property taxes; they can get rid of anyone working at these airport with no obligations to pay them a red cent of indemnity – the greek state is obliged to do it for them; likewise the Greek state is obliged to pay any damages related to work accidents even if Freeport is found guilty; and pay for any environmental study needed; and pay indemnity to Freeport if archeological finds are discovered and delay the extensions planned; and, and, and…

    The Press Project also reported on some of the under the table machinations that have been going on with the privatization fund:

    • Not Freeport but Fraport…autocorrect is up to its usual tricks.

    • Giaourti Giaourtaki

      Fraport belongs to state-owned Frankfurt Metro, Lufthansa is also connected to hotel business that has big plans for the eastern Aegean – another background for VAT explosion on islands – a Disneyland for Krauts in Turkey and Greece with all profits and tax going to Germoney, the food won’t be local too, made by Polish slaves for Lidl on former GDR-collective “Junkerland”, some may be will be “Greek like food” but not Greek. The only thing one can do about it is to boycott German run airports, publish it plus support the resistance against Kastelli airport

  4. yes keep it up syriza supporters, dont forget though the worse the economy gets, the cheaper the selling price will be = )

    • Giaourti Giaourtaki

      You can buy some prisons and make hotels out of them, Greece does not need prisons