Piraeus, the largest Greek seaport, is the world's fastest growing port and will be the largest port in the Mediterranean by 2019, displacing Hamburg from third place in Europe, the German newspaper Die Zeit writes.
Two years ago, following an international tender, the China Ocean Shipping (Group) Company (Cosco) bought 51 percent of Greek state-owned Piraeus Port Authority (PPA) for 280.5 million euros ($312.51 million), acquiring a block of 12.75 million shares in PPA. Under the deal, Cosco has management and operation rights to run the PPA until 2052. The port, a key node in Beijing's Belt and Road network is being transformed into a significant transit hub for rapidly growing trade between Asia and Europe.
Cosco already operated the container terminal in Piraeus under a 35-year concession it acquired in 2009. The transhipment of goods has more than tripled since the Chinese bought a stake in Piraeus. In 2017, there were only 3.7 million containers, and in 2019 they are expected to reach five million, making Piraeus the largest port in the Mediterranean. This year the administration seeks to increase freight traffic by 35% according to the news report in Die Zeit.
Numbers don't lie. The financial results for the year 2017 of PPA were presented on Tuesday to the Greek government’s privatisation agency, Hellenic Republic Asset Development Fund (HRADF) at the Athens Stock Exchange, in the presence of the CEO of PPA Captain Fu Chengqiu, Angelos Karakostas, Deputy CEO, Athanasios Liagkos, Member of the Board of Directors and Management Consultant, Tian Chao, General Manager - Financial Dept. and other executives of the company.
The turnover amounted to € 111.5 million compared to € 103.5 million in the corresponding period of 2016, showing an increase of 7.7%. Profit before tax amounted to € 21.2 million compared to € 11.0 million in the year 2016, showing an increase of 92% and the net result is shown improved by 68.6% to € 11.3 million compared to € 6.7 million of the year 2016. This is the best profitability of the company over the last decade.
"The 2017 was the first entire year of the new Management at the port of Piraeus and was marked by positive results. We believe that the implementation of our investment plan, which is already in progress, will further improve both the operational function and the economic efficiency of PPA S.A. and all business units will continue to have positive results." Captain Fu Chengqiu stated.
It is noted that during the first months of 2018 the company's upward trend is being continued and the most important increase has been recorded in Car Terminal (+ 32% in transit and + 23% in domestic cargo for the period January - April 2018).
An increase of more than 10% is also noted at the same period in the ship repair activity, despite the fact that the existing docks were not in full operation, due to the installation works of the new floating dock.
Earlier this year, Cosco unveiled a $620 million Piraeus development plan with the highlight being the creation of the biggest shipyard facility in the Eastern Mediterranean. Goal of the shipyard development is to create a facility able to service 450 vessels annually, with particular attention being given to mega yachts.
The company also announced plans for the construction of four hotels in the area, a new cruise terminal and shopping centers totalling 40,000 square meters that would be open to the wider public as well as cruise passengers.
The Port of Piraeus At a Glance
The history of the port can be traced to 490 BC, when the Athenians realising the strategic importance of the deep water harbour, converted it into a military harbour. Following the creation of the Modern Greek State after the Greek War of Independence and with the establishment of Athens as the capital of the Greek State in 1832, the port of Piraeus entered a new phase of growth and development.
PPA was founded in 1930 and contributed to the development of the port. In 2003, PPA was listed on the Athens Stock Exchange, although the state retained a 74% stake in the company and effectively the management of its respective business. In 2016, COSCO completed PPA takeover. As part of the deal, in five years’ time it will be able to acquire a further 16 percent stake for €88 billion—once it has completed investments worth €300 million.
PPA operates through Container Terminal, Handling Car, Coasting, Ship Repairing, Cruise, and Other segments.