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Along the New Silk Road – Piraeus: China’s gateway into Europe

  • Written by  Charles Stevens
  • Published in Development
The Port of Piraeus The Port of Piraeus (Image: Port of Piraeus)
17 Aug
2018
As part of our monthly series of reports looking at the impact China’s BRI project is having on the local infrastructure situated along its route, explorer and China scholar Charles Stevens visits the Greek port that marks the point where the Road meets the Belt

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THE NEW SILK ROAD PROJECT
Covering 10,000 miles and 18 countries The New Silk Road Project is an exploration of China’s emerging Belt and Road Initiative. Having departed from London in June 2018, it will travel along the full length of the world’s next great trade route – a nexus of power, culture and commerce that now sits at the heart of China’s foreign policy.

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Nektarios Demenopoulos sweeps his palm as smoothly as a sailing ship across a glass encased model of the Port of Piraeus, indicating its expansion plans and ambition to become ‘the number one port in the Mediterranean area’. He’s so confident of this that the aim is repeated a further three times during our conversation. In 2016, China’s COSCO Shipping, the largest shipping company in the world, acquired a 51 per cent stake in Greece’s Piraeus Port Authority. This cemented the entrepôt’s significance to the future of Sino-European trade and its position on China’s Maritime Silk Road. As Altay Alti, associate professor at Turkey’s Koç University affirmed: ‘Piraeus has become a gate of entry into the European market for the Chinese.’ Indeed, this is no secret and is highlighted as a main priority in the port authority’s strategic plan.

The Port of Piraeus and the surrounding regions have long functioned as a Mediterranean gateway for peoples, goods, ideas and beliefs. As we tour the port’s facilities, the waters of the Saronic Gulf to our left and the perimeter of the port squeezed up against the town to our right, Nektarios points to the stumped remains of the Long Walls; an apt reminder of the Persian attempt to use the area as an access point to Attica and the surrounding mainland during the Greco-Persian Wars.

Chinese and Greek signs adorn the Port entrance (Image: Charles Stevens)Chinese and Greek signs adorn the Port entrance (Image: Charles Stevens)

Now China’s state-owned COSCO is galvanising the Port of Piraeus to reconnect with those surrounding regions. By aligning their interests, the Chinese corporation wants the port and the local area to be transformed into an economic hub after having suffered through several years of inefficiency and stagnation under the leadership of the Greek government. As a result, the expansion project, which now sits under the umbrella of the Belt and Road Initiative (BRI), poses as an example of a true ‘win-win cooperation’ (a slogan frequently employed by Chinese officials since the formal announcement of the BRI in 2013). This is being achieved by providing Greece with an investment lifeline – albeit a limited one – after years of fiscal, economic and political turmoil. In return, China has received its much desired Mediterranean base, prime for accessing European markets. As Paul Sedille, founder of website Eurasian Vision, commented: ‘it is rare that a European-Chinese interest met perfectly and that something happened.’

As we traverse the curvature of the port’s 37km coastline, Nektarios points to the various activities and upgrades that form part of COSCO’s mandatory €350million investment in the area; the expansive car terminal from which our current, bright blue Suzuki vehicle arrived from Japan; the shiny, new rail link which has plugged the port into Greece’s network since 2013; the three newly-acquired ‘super-post-Panamax’ cranes which will help to boost the port’s annual container capacity to 7.2 million TEU (Twenty-Foot Equivalent Units – used to measure a ship’s cargo carrying capacity, ostensibly the size of one standard shipping container); and the central cruise and ferry terminals where some of the 24,000+ ships that arrive at the port every year moor. Collectively, these activities and upgrades have boosted the port from ranking 93rd in the world by annual throughput to its current position at around 30th.

Newly installed cranes at Piraeus Port (Image: Charles Stevens)Newly installed cranes at Piraeus Port (Image: Charles Stevens)

Despite this rapid ascendency, Piraeus’s role is still limited enough to not be viewed as a threat by other leading European ports. During a visit earlier on our route to the Port of Rotterdam’s dreary headquarters rising above the banks of the Nieuwe Maas, one of its corporate strategists, Michiel Nijdam, explained that ‘we are not worried about Piraeus or COSCO owning Piraeus […] the main markets we serve are in a reach of 800km […] we do not have overlapping service areas.’ Indeed, this sentiment resurfaced nearly 550km northeast during our visit to Kumport, Turkey’s third-largest terminal. Here, Jan Zhang, the terminal’s newly appointed chief operating officer sent by COSCO from mainland China told us, ‘we specialise in local carriage [...] we are at the entrance of the Black Sea.’

The acquisition by COSCO Pacific of a significant minority stake in Kumport, along with the purchase of stock and even entire terminals in Europe by Chinese companies, showcase the country’s fast-growing footprint in the region. This stretches from a minority stake in the Euromax Terminal in Rotterdam to a controlling share in Spain’s Noatum Port and a terminal link in Marseilles, France. Piraeus sits both as a precedent to this subsequent investment and at a nexus of an expanding network of interests diffused along China’s Maritime Silk Road.

The Grand Spring awaiting repairs (Image: Charles Stevens)The cruise liner Grand Spring awaiting repairs (Image: Charles Stevens)

While China’s signature ambition is visible throughout all activities at the Port of Piraeus, it has been careful not to make its presence intrusive. Outside the headquarters, a single Chinese flag flies delicately alongside its Greek and European counterparts, while sitting above the main entrance are equal-sized Greek, English and Chinese scripts stamping the company’s name onto its facade. Inside the impeccably polished entrance of the headquarters, a Greek receptionist highlights China’s commitment not just to its own geo-economic outreach but to the success of local employment in a district etched with the impacts of economic decline.

As we circle the harbour, we are shown the more luxurious upgrades planned for the port. The brick warehouses and hollowed factories, once home to thousands of migrants and refugees in the long months of 2015, are to be replaced by ‘world-class hotels’ and a large shopping mall. In the maintenance yard, at one extremity of the port, the cruise ship Grand Spring sits idle, surrounded by mobile cranes. Below on the dock its defunct parts from years at sea are strewn in a colourless collage. It is to be one of the last vessels to be repaired before the whole yard receives an upgrade in an effort to become the leading ship repair facility in the East Mediterranean.

MERICS Silk Road v8An overview of the full BRI plan (Image: MERICS - Click to enlarge)

Such a facility could help Chinese goods reach both the Port of Piraeus and, more crucially, the lucrative opportunities beyond its threshold in the heartland of the European Union. As Plamen Tonchev, head of the Asia Unit at the Institute of Economic Relations in Athens, told us: ‘Through Greece, the Chinese are targeting a much larger market in the Balkans and, above all, in Central and Western Europe.’ The upgrading of the Budapest-Belgrade railway through Chinese financing is the beginning of this effort. It is one of the largest infrastructure projects in Central Europe and the blueprints highlight future ambitions to extend the line to Piraeus.

After parting ways with our kind host, I’m grateful to return to the air-conditioned interior of our Jeep. From here the Greek Orthodox Church of Saint Nicholas stands across the road. My eyes trace around its azure domes and then down the fluted columns of a classical architectural order. It provides a fitting reminder of the architectural legacy passed down from a Western civilisation and the associated values, institutions and beliefs some of which the European Union still enshrines today. Some of these inherited legacies are less visible but certainly no less beautiful or important than the architecture which this site preserves. They should be cradled as carefully as the commerce that Chinese vessels carry and heard as clearly as the voices which accompany them from across Eurasia.

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