ATHENS -- Chinese-owned COSCO subsidiary Piraeus Container Terminal (PCT) and Piraeus Port Organisation (OLP) have reached an agreement in principle for an additional investment of 230 million euros (308.9 million U.S. dollars) at Piraeus, Greece's largest port, Greek Shipping Minister Miltiades Varvitsiotis announced on Tuesday.
The deal, which had been under negotiations from June, paves the way for the construction of OLP's West Pier Container Terminal III and upgrade of Pier II by PCT, as well as the construction of a new oil pier on Container Terminal III.
According to the new agreement, PCT will no longer be subjected to the guaranteed minimum payment until the date the Western Part of Pier 3 enters into operation and in any event until Greece's GDP returns to the level of 2008 plus a compounded increase of 2 percent per annum.
"The agreement seals the transition of the port of Piraeus into a new era, as this is the largest investment in crisis-stricken Greece," Varvitsiotis told the media.
He stressed that the new investment will create further 700 new job positions directly and some 1,500 indirectly in the country suffering from high unemployment rates over the past three years and deep recession.
The principle of the new deal has already been ratified by the two companies' boards of directors and the deal needs to be approved by the Greek parliament before coming into force.
With the expansion of PCT's activity the total worth of COSCO's investments to the port will reach 500 million euros and Piraeus will have in coming years the capacity to handle up to 6.2 million TEUs per year, three times the 2.1 million TEUs handled by PCT in 2012, the Greek side noted.
Under a 35-year concession agreement, PCT launched operations in the country at Pier II of Piraeus port in 2009 with a plan to turn it into a leading container terminal in the Mediterranean Sea region and ever since has built Pier III and posted remarkable results.
Statistics from the Containerisation International magazine show that Piraeus was placed first in 2011 and 2012 among the world's 100 major container ports in terms of the traffic increase. Officials from PCT said this is one of the main reasons for the company to increase its investment in Greece.
The company currently employs about 1,000 Greeks in its facilities at Piraeus port.
According to a recent study by the Greek National Bank, the concession of Pier II at Piraeus to COSCO and the steps taken after this will lead to the boost of GDP by 2.5 percent by 2018 and the creation of about 125,000 new job positions in the area.
