Seatrade Cruise News is part of the Informa Markets Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Piraeus: Cosco moving forward with cruise investment plans while refugee issue a cause for concern

Piraeus: Cosco moving forward with cruise investment plans while refugee issue a cause for concern
Now that Cosco Shipping Corporation has signed a $412m agreement giving the Chinese company a majority stake in Piraeus Port Authority (PPA), the already announced intention to invest $150m to turn the Greek hub into one of the world's biggest cruise ports is moving forward with pace.

Xu Lirong, the president of China Cosco Shipping, said 'Greece will have many benefits from China¹s growing influence and power in the global market,' during the April 8 signing ceremony that he, Greek Prime minister, Alexis Tsipras and the head of Greece's privatization fund, Taiped, inked.

Xu insisted his company's objective is to transform Piraeus into the Mediterranean¹s most competitive port.

He said Cosco plans to invest in maintaining Greece's shipbuilding/repair infrastructure, seek a greater share in the cruise sector and organise coastal shipping.

Having last month secured acquisition of the controlling stake in PPA, Cosco is already consulting with major cruise lines to develop the cruise potential of the Greek market and Piraeus. The consultation process is expected to be completed by July.

It's also likely Chinese companies will be tapped with a view to increasing Chinese tourists to Greece. 'Chinese companies see huge investment opportunities in Greece and this is something that is backed by the Chinese government,' said the Cosco group president.

Tsipras sees the agreement as delivering 'an important message to the world¹s financial community'. He noted the deal will make the 'Silk Road faster and shorter' at a time when Greece is entering a new phase where emphasis is given to the recovery of the economy.

Greek president Prokopis Pavlopoulos expressed the hope for more investments to come to Greece while meeting with Xu after the agreement signing. 'I hope this deal is just the beginning for many more investments to come to Greece,' Pavlopoulos told Xu while noting the importance of the deal for both sides.

Under the deal, Cosco will pay $314m (€280.5m) to buy 51% of the PPA and around $99m for another 16% after five years, on the condition it makes investments of $392m in the next decade.

In the meantime, the government and Piraeus port officials are struggling with 4,100 refugees and migrants camped inside the Piraeus port¹s boundary fence, breaking ISPS regulations.

Pictures have appeared in local media of hundreds of refugees calling and waving to passengers in cruise ships calling at Piraeus.

Though there have been no reports of disruption to the handling of cruise ship and passengers, ferry services are causing concern on the opposite side of the port to the two cruise terminals.

The situation is causing the local cruise industry mounting concern, not only in Piraeus but the wider Greek cruise destinations.

The deteriorating situation in Turkey saw some cruise ships diverting to Greek destinations and while originally this was bringing benefits it is no longer.

Theodore Kontes president of Greece's Union of Cruise Ship Owners and Associate Members (EEKFN) told Seatrade Cruise News the situation is having a negative impact. He said after a busy period leading up to Christmas, the cancellations are now coming in.

Already it looks like ship calls to Greece this year will be down 7% and passenger numbers close to 10%,  said Kontes. He said Greece needs to take measures in order to minimise losses to the cruise industry including increased security measures at ports, airports, attractions visited, and generally in cities and crowded places. 'This should be organised, implemented and communicated directly to interested parties internationally,' he remarked.

Kontes called for proper management of the refugee problem, particularly in the major ports and islands with high tourist traffic.

He also suggested an immediate solution to the issue of intra-EU cruising under the current extraordinary adverse conditions referring not only to refugees, but also the cancelling of some Turkey calls. 'Because of this, round trip cruises are only calling within EU countries thus VAT is imposed on all supplies and services adding to the overall cost and forcing cruise lines to look for alternative deployments.'