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Greek Prime Minister Kyriakos Mitsotakis is riding a wave of success in just under five months in office, the cherry on the cake is the dozen or so bilateral trade deals signed with China’s president this week, mostly in the energy and transport sectors.
Greece is enjoying fresh momentum, with the economy recovering, and growth very near on the horizon.
The biggest driver in the new-found optimism is the revival of Chinese interest to boost shipping giant Cosco’s plans to invest more in the port of Piraeus, which fits hand-in-glove with Beijing’s ambitious trade push under the One Belt, One Road strategy, which incorporates vertical with horizontal integration.
The plan is to control the mode of transport and the infrastructure with which to flush the European market with Chinese goods, and if cash is the problem, then Chinese banks are willing to extend favourable loans, at a cost, both financial and political.
Also joining Xi Jin Ping’s delegation to Athens this week were major financial institutions expressing interest to enter the Greek market, primarily looking to provide funding for the booming shipping sector, as Greek owners have placed the bulk of their vessel orders with the biggest shipyards in China.
The country is also the first and final destination of almost all Greek-owned shipping companies, transporting raw material, finished goods and sources of energy to and from anywhere in the world.
At the same time, Chinese diplomacy is pushing its influence in Africa, widely believed as the underutilised and resource-rich continent, where protective regulations, such as those imposed by the European Union on foreign trade partners, are almost non-existent.
Mitsotakis saw an opportunity and grabbed it, away from the spotlight of the US-China trade wars, and is now moving on to the next step of economic revival which includes fast-tracking privatisation programmes, large-scale property development, making the ‘Invest in Greece’ brand far more attractive than it has been for over a decade.
In its effort to catch up, Greece will undoubtedly compete with the Cyprus services sector, dogged by a tarnished image problem and the head-in-the-sand approach adopted by the administration in Nicosia.
Already, advisory firms are trying to lure clients away from Cyprus and encourage them to set up shop in Greece, where incentives are being devised to make Athens an attractive business centre.
Shipping is next, where due to the unresolved political division, the Cyprus flag keeps stumbling on obstacles, such as the Turkish embargo, forcing shipping companies to seek registration elsewhere.
As a result, Cyprus companies are shifting away from ownership and seeking a key role in management, a niche sector, as Greece embarks on enhancing its fleet further.
With many more sectors where cooperation should have been warmer and closer (tourism, exports), it is clear that a commercial clash is inevitable.
What Cyprus needs to do now is to decide if it wants to remain a second-tier regional trade partner of Greece with national sentiment shared by the two, or will it be at the forefront, seeking equal exposure and promoting Cyprus’ interests first.
