China and Greece agreed on Monday to move ahead with a € 600 million investment from COSCO Shipping in Greece's largest port, Piraeus, as part of efforts to increase its hub role in fast-growing Asia-Europe trade. .
The deal, part of 16 trade deals signed between Greece and China, came during an official visit by Chinese President Xi Jinping to Athens on Monday.
The two countries have approached each other since 2009, when COSCO won a 35 year concession to upgrade and operate container loading docks in Piraeus. COSCO Shipping purchased a majority stake of 51% in the port of Piraeus in 2016.
COSCO plans to make Piraeus port the largest trading port in Europe, spending about 600 million (660 million) to boost operations, including mandatory 300 million investments in 2022 that, once completed, will allow acquire an additional stake of 16% in Porto.
But opposition from local communities prompted Greece to reject COSCO's proposals for a new container terminal in Piraeus last month, saying conditions were "not yet ripe".
Xi met with Greek Prime Minister Kyriakos Mitsotakis On Monday, the two countries signed a memorandum of understanding stating their mutual willingness to overcome any obstacles in implementing COSCO's investment in Piraeus, a Greek government official said.
Both sides tried to explore Greece's strategic location at the crossroads of Europe, Asia and Africa, saying it could become a center for the channeling of the world's second largest economy and largest exporter to Europe.
“We want to strengthen the role of Piraeus transhipment and further increase the transfer capacity of China's rapid maritime link with Europe,” said Xi after meeting Mitsotakis.
Xi is due to visit COSCO's facilities in Piraeus, Europe's sixth largest container port, later this Monday.
During a visit to Shanghai last week, Mitsotakis said he wanted Piraeus to become Europe's 1 port and COSCO spending could reach 1 billion euros.
The European Investment Bank (EIB) agreed on Monday to provide a € 140 million (US $ 154 million) loan to assist COSCO in its Piraeus investment plan.
Xi said China also wanted to expand its investments in the energy, transportation and banking sectors.
China's State Grid holds a minority stake in Greece's ADMIE power grid operator. On Monday, State Grid expressed interest in participating in ADMIE's 1 billion scheme to build an undersea power cable to connect Crete to mainland 2023.
In the banking sector, the head of Greece's central bank, Yannis Stournaras, met with executives from China's Industrial and Commercial Bank. The Bank of Greece has informed the bank that it can set up a representative office in Greece.
Another Chinese bank, Bank of China Europe, established an branch in Athens this month.