Greece, a European hub for China

Πηγή: Defencegreece
September 3, 2011

According to a recent report from the Center for Strategic and International Studies (CSIS) on China’s new Balkan strategy, Beijing sees Greece as a modern gateway linking Chinese factories with consumers across Europe, the Middle East, and North Africa.

More specifically, according to the report:

Communist China did not assume a direct role in the volatile Balkan region until the late 1970s. Despite robust cooperation with Albania, mainly built upon a shared opposition to Soviet claims of world communist leadership, it was not until the summer of 1978 that Beijing articulated a coherent policy to deal with Southeastern Europe.

For a post-Mao leadership, the Balkan region had then become an important element in a broad diplomatic offensive meant to secure a foothold in the Soviet Union’s sphere of influence, open up to the Third World, and forge valuable relationships with nations which could help modernize the Middle Kingdom. In effect, China severed ties with Enver Hoxha’s Albania to develop tighter economic, political, and personal bonds with Josip Broz Tito’s Yugoslavia and Nicolae Ceauşescu’s Romania.

However, the fall of the Iron Curtain and the bloody disintegration of Yugoslavia prevented China from sustaining strong links with Southeastern Europe. As the Balkan region is returning to stability, the time has come for Beijing to invent a new strategy and spread its influence through increased trade, clean energy investments, and embryonic political alliances.

To increase commercial exchanges with Southeastern Europe, China has made considerable investments in Greece. Since the onset of the country’s debt crisis, Beijing has been playing a proactive role by supporting the purchase of Greek bonds, announcing plans to double its annual trade with Athens to USD 8 billion by 2015, and setting-up a special Greek-Chinese shipping development fund of USD 5 billion.

More strategically, at the height of the financial crisis, in November 2008, Chinese President Hu Jintao signed a EUR 3.4 billion agreement to allow the state-owned China Ocean Shipping Company (COSCO) to upgrade and run part of the country’s chief port in Piraeus. The deal’s entry into force on 1 October 2009 also allowed COSCO to enhance the port’s capacity by building a third pier. The pending construction of a logistics hub in nearby Attica should help attain the goal of tripling operations up to 3.7 million containers by 2015. Ahead of these projects, Beijing has already decided to gradually stop using the ports of Naples and Istanbul to redirect maritime traffic toward Greece.

Furthermore, COSCO is bidding to operate the port of Thessaloniki, linked by rail to the rest of the Balkan Peninsula into Central Europe. The Chinese government is also vying to buy shares of the struggling state-owned Hellenic Railways Organization (OSE), scheduled to go up for privatization in the years to come as part of the massive Greek deficit-reduction plan. Such a move would allow the rapid delivery of Chinese products transiting through Greece.

This planned Chinese takeover of maritime and rail assets intends to transform Greece into a Southern rival for Northern Europe’s Rotterdam. Indeed, the country’s strategic position makes it easier for container ships transporting Chinese goods to travel from East Asia to Europe via the Suez Canal. It also provides an ideal base to reach emerging markets in the Mediterranean Basin and the Black Sea region. In other words, Beijing sees Greece as a modern gateway linking Chinese factories with consumers across Europe, the Middle East, and North Africa.