China buys Greece, adds it to growing country portfolio
Under the terms of the agreement, the country can continue to market itself as “Greece” for the foreseeable future.
No purchase price was given, but Chinese officials said they had paid “billions of dollars” for the debt-stricken Mediterranean country earlier this week.
Okay, that’s not exactly how it went down, but it may as well have been. Greece is home to the Olympics after all, and after making such a big deal about the Beijing games, China obviously decided Greece is the word, is the word, is the word …
Bad jokes aside, the Chinese government and a suite of businessmen signed 14 investment deals with the country.
Cosco is already expanding two container terminals at the port of Piraeus at a cost of US$4.27 billion. Also in the port city, Chinese construction company BCEGI signed a $135 million deal to develop a hotel and shopping mall complex.
According to reports, other deals include the exchange of know-how between China's Huawei Technologies and the Greek telecoms organisation OTE, and four agreements signed by food firms to export olive oil to China.
China is even planning to buy a hefty stake in the loss-making national rail network, OSE, building an airport on the island of Crete, a logistics centre north of Athens and a marine theme park.
China is confident Greece will emerge from its debt-soaked position and has pledged to stand behind the troubled Mediterranean nation with one hand on its shoulder and the other on the purse strings. But China is no charity organisation and snapped up the 14 deals at what is sure to have been fire sale prices.
In fairness, there is good reason for China boosting its terminal investment in the Med. Asia-Europe container volumes are increasing rapidly and even with a post-peak season slowdown, the forecast for trade between the two regions is positive.
The traditional European gateways of Rotterdam and Hamburg are great for northern EU-bound cargo but Piraeus is closer to southern and eastern Europe. Substantial savings can also be made in shorter transit times and less fuel burn.
So buying Greece is not such a bad move for China. And it can add the country to its growing portfolio that includes most of Africa and the US.