China and Southern Europe On the Front Line—The Role of Spain, Greece, and Italy in International

Zsófia Gulyás–Noémi Szőke–Norbert Miklós

China’s rising role in international politics has become a problematic issue for many Western nations during the last decade: the emergence of an Asian nation to become the second-largest country by nominal GDP has certainly caused the US leadership to feel uncomfortable. This unease has also manifested itself in US foreign policies since the beginning of the 2010s, when President Barack Obama launched the “Pivot and Rebalance” (or “Pivot to Asia”) strategy, later to be abandoned by President Donald Trump, who, in turn, introduced his concept called “A Free and Open Indo-Pacific.”1 The new president, Joe Biden, has so far seemed to keep a close eye on China, just as his predecessors, as the global race for supremacy has already begun and the divide between Washington and Beijing has been widening. The clash of rhetoric and the fight for political and economic influence keeps on surfacing almost all around the world from the East Asian theatre to the Indian and the Pacific Oceans. A key piece of this jigsaw puzzle is, of course, Europe. As the Central and Eastern European bloc began its closer cooperation with China in the last decade and the Belt and Road Initiative’s construction works broke ground, Europe now finds itself between two superpowers, which are both vying for influence in the continent.

One of the most important regions in this competition for influence in Europe is the Mediterranean Sea, as it could play a substantial part during the new era of strategic competition. That is why this article aims to take into account some of the most significant regional nations and how Chinese influence is growing over these countries, traditionally allied to the US. It focusses on three different parts of the Mediterranean: The Iberian Peninsula, Italy, and Greece and shows how Chinese political and economic capital set foot and grew in importance in the region.

According to historical records, the first diplomatic exchanges between China and Italy took place in ancient times, when the Han Empire and the Roman Empire laid the foundation for what later became known as Sino-Roman relations. In the following centuries and, after the fall of the Roman Empire, Italian merchants, travellers, and missionaries, such as Marco Polo, Giovanni da Montecorvino, and Matteo Ricci, deepened relations through the ancient Silk Road. In modern times, the legal predecessors of contemporary Italy and China gradually developed their political and economic ties, and the Italian Republic and the People’s Republic of China (PRC) finally established formal diplomatic relations on 6 November 1970, almost five years before the European Community recognised the latter.

As Italy is one of the founding members of the European Union (EU) and a member of the Group of Seven, which comprises the world’s most advanced economies, the Mediterranean state has been of paramount importance to China over the past fifty-plus years. Until the early 1990s, bilateral relations between the two countries developed dynamically, with Italy and the Italian Communist Party (Partito Comunista Italiano, PCI) serving as China’s gateway to the Western world. Although economic ties continued to develop in the following years, diplomatic relations came to a halt when the PCI, which maintained good relations with the Communist Party of China (CPC), split after the fall of the Soviet Union.2

After more than a decade of no significant progress in the development of bilateral ties, the governments of Italy and China issued a joint communiqué in 2004 to improve Chinese–Italian diplomatic relations. The document underscored the importance of close dialogue on antiterrorism and human

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rights and of cooperation between international organisations. Silvio Berlusconi and Wen Jiabao, the then prime ministers of the two countries, agreed to establish a comprehensive strategic partnership for long-term and sustainable relations.3 This mutual understanding provided a solid basis for renewing the two country’s bilateral relations, especially at the beginning of the 21st century, when disappointments marred the initially promising political and security ties between China and the EU due to excessive expectations of each other. Within the strategic partnership framework, the heads of the two governments decided to set up an inter-ministerial committee, led by the Italian and Chinese ministers of foreign affairs, to boost specific types of cooperation between their states. As this high-level coordination body was the first that China established with a foreign country, it represents a milestone in Sino-European relations, too.4

One of the most significant ordeals of the last almost one and a half decades was the global financial and economic crisis that erupted in 2008, the negative consequences of which were felt for years to come. The Italian economy was hit extremely hard by this downturn. The European sovereign debt crisis, which began in 2009, when several eurozone member states failed to get their sovereign debt under control, plunged the country into severe political turmoil in the early 2010s. Italian economic indicators deteriorated sharply, and the country officially re-entered recession in 2011, despite measures taken to address the crisis. In addition to its long-standing structural weaknesses, Italy’s declining competitiveness and lack of growth became increasingly serious.5 The economic crisis was exacerbated by intensifying mass immigration as a result of the Libyan civil war. To interpret the Italian–Chinese rapprochement of the 2010s, it is essential to take these circumstances into account.6

After the economic crisis, the first important step in developing bilateral relations was Premier Li Keqiang’s official visit to Italy in the fall of 2014. At the time, two-way trade between the two countries exceeded EUR 60 billion, and the East Asian global power was Italy’s third most important commercial partner ahead of the United States. Italy, however, already had a massive trade deficit with China. The main objective of the diplomatic visit was, above all, to promote mutual investment and to establish trade balance by signing several trade agreements. While in Italy, Li Keqiang also attended the 10th biennial summit of the Asia–Europe Meeting, held that year in Milan,

where then Italian prime minister Matteo Renzi expressed support for negotiations on a possible future free-trade agreement between Italy and China. The growing Chinese presence in the Mediterranean country is well illustrated by strategic investment in the Italian energy sector realised by companies such as the Shanghai Electric Group and the State Grid Corporation of China realised. One of the key investors in the eight most prominent Italian companies, including Fiat Chrysler Automobiles, is the People’s Bank of China. Italy initiated a business forum in 2015 to smooth the cooperation between Chinese and Italian small and medium-sized enterprises and attract more Chinese foreign direct investment.7 As maritime transport is of the greatest importance for trade between China and the EU, the Chinese COSCO Shipping’s takeover of 67% of the Port of Piraeus was strategic loss from Italy’s point of view. As a result, the trade share of Italy’s largest port, Gioia Tauro, fell by 30% between 2008 and 2015.8 Italians realised that the challenging economic situation of that time was only exacerbated by the underutilisation of their ports and railroads to ship to Central and Eastern Europe, since the country could, thus, not serve as a central hub for trade from China via the so-called 21st-Century Maritime Silkroad.9 The Trump administration’s 2016 withdrawal from the proposed EU–US trade agreement, the Transatlantic Trade and Investment Partnership,10 also steered Italy towards the Belt and Road Initiative, the only global trade and infrastructure initiative connecting Europe and Asia.

Moreover, Italian–Chinese trade indicators became increasingly unfavourable to the Mediterranean country in the 2010s. Compared to the period from the early 2000s to 2008— when the volume of trade between the two economies increased by about five times—data for 2009 showed a significant decline in trade figures. Although trade volumes exceeded pre-crisis levels at the beginning of the next decade, the following years were characterised by stagnation.11

These factors made Italy the only major European economy so far to sign a bilateral memorandum of understanding with China on the BRI, which happened during President Xi Jinping’s official visit to Italy in March 2019. However, Italy’s engagement with the East Asian global power has created distrust among its traditional Western allies. As a result of subsequent US efforts to prevent China from further expanding its influence, joint projects between the two country’s agencies, such as the Italian Space Agency and the China National Space Administration, failed, and Huawei was barred from participating in the deployment of Italy’s 5G network.

As far as bilateral relations between Rome and Beijing are concerned, health and economic cooperation during the coronavirus pandemic— and its possible international repercussions—is of historic importance. The spring of last year was a critical time for Italians. Daily new cases and mortality were strikingly high in the country, and the pandemic hit some regions and provinces particularly hard. The most notorious example is probably the province of Bergamo, with more than one million inhabitants, where there were almost 6,000 deaths in March 2020 alone.12 For China, a contender for the position of the world’s leading superpower, it was an excellent opportunity to demonstrate its crisismanagement skills and reliability. The East Asian country was one of the first to send medical aid to Italy, mainly in the form of doctors, experts, and medical supplies.

Italian prime minister Matteo Renzi and Chinese premier

Li Kequian in 2014

However, a significant part of the international community and the Italian inhabitants saw this assistance as a means of Chinese propaganda disguised as an instrument of solidarity. The term “mask diplomacy” took on a negative connotation after official Chinese government aid was mixed up with poor quality medical equipment offered by Chinese companies in exchange for high profits. However, the proChina narrative about the outbreak, spread, and global management of the pandemic, enforced globally by the CPC through all existing official and informal channels, also played a crucial role in the fact that the term has become widely known in this pejorative sense.

Italy and the Italian public have obviously turned into an excellent target for Beijing’s communication efforts to replace the term “Chinese virus” with “Chinese aid.” One of Italy’s biggest news agencies, the state-run ANSA, came to be the main outlet in Italy to diffuse information from the Chinese Xinhua news service thanks to a collaboration agreement signed in 2019.13 Xinhua, which is taking responsibility for its content referenced by ANSA, is close to the Chinese government and it is considered one of the main tools of propaganda of China in the country.

Under these circumstances, Italy is a weak link for the EU because of its deepening economic and diplomatic relations with the East Asian country. The EU interprets China’s growing presence in the Mediterranean country as a serious threat to the unity of its member states. For China, Italy is a strategic base in Europe with a long history and significant cultural heritage in a geostrategically advantageous location. Besides, it represents a sizeable market and welcomes Chinese foreign direct investment, while it is also an excellent promotional tool for the “benevolent superpower” to underline its competence and credibility internationally. Italy, therefore, plays a significant role in China’s efforts to expand its economic and political influence. Although China is a key partner for the Italians, indispensable for their country’s economic development—especially during recessions and crises—it must also be stressed that this relationship is at least as beneficial for China as for Italy, if not more so.

Portuguese−Chinese relations have a long and eventful history, which started during the Age of Discovery in the 16th century and continues to impact the varied cooperation between the two states even today. Modern-day connections between them began in 1979, when Portugal established diplomatic relations with the People’s Republic of China. In the 1980s and 1990s, their ties were mostly determined by the question of the former Portuguese colony Macau’s status and the process of reuniting the island with China. This period, which concluded in 1999, lacked any major tensions, and the Chinese leadership, to this day, sees it as an example to settle the country’s other, still unresolved, territorial issues.

Portuguese–Chinese bilateral economic relations started to develop in the 2000s: in 2005, the two countries signed a treaty on global strategic partnership, which was developed further into a comprehensive strategic partnership in 2010. Their trade relations have also been increasing since the early 2000s. In this framework, decisions were made to sign several cooperation agreements on issues such as culture, tourism, technology, finance, telecommunications, or electric power. The 2007–2009 Great Recession and the ensuing financial crisis had a decisive role in the development of economic relations between Beijing and Lisbon, as it impacted the economy of the Mediterranean states, Portugal among them, particularly heavily and the Portuguese government was happy to welcome Chinese investors who showed increased interest in the country thanks to the decades-long good and balanced political relations between the two states.

Consequently, Chinese investment in Portugal has started to increase dynamically from 2010. It mostly consisted of acquisitions during a privatisation process which gained great momentum in the Iberian country

The container port in Sines

following the economic crisis. Until the mid2010s, most purchases were made by Chinese state enterprises, and the proportion of greenfield investments was very low. One of the most ambitious buys was the EUR 2.7 billion acquisition of the state electricity supplier Energias de Portugal, which was followed by other deals in Portuguese strategic sectors, e.g., energy, finance and insurance, and infrastructure. Portugal continues to be an important target for Chinese money in Europe: the country netted EUR 6 billion Chinese investment by 2019, the eighth-biggest sum within the EU. These figures are particularly noteworthy, considering that Portugal’s population is not very large. However, there was a remarkable change in the last two or three years, as, in keeping with wider European trends, Chinese investment increasingly started to come from private rather than state enterprises.

China devotes special attention to Portugal for several reasons. One of them is their abovementioned traditionally well-functioning political relations, while another one is the fact that Portugal is a member of the EU, which creates good opportunities for Chinese investors and entrepreneurs to enter the EU market through the Iberian state. This advantage is very much furthered by a programme called Golden Residence Permit for Investment Activity, launched in 2012, as it enabled foreign nationals, among them many Chinese, to apply for residence permits in exchange for a set amount of capital and/or investment with an abbreviated procedure, allowing them to move freely within Schengen borders.

However, China considers Portugal an important partner owing to not only its European connections but also its global ones: through its former colonies, Brazil, Angola, and Mozambique, Portugal plays a middleman-like role in South America and Africa. Even though Portuguese leadership is criticised for both its home and foreign policy allowing too much room for Chinese investors to buy into the country’s strategic and other sensitive sectors by Brussels and Washington alike, it seems that this criticism has not yet succeeded in undermining Portuguese− Chinese relations, and the small Iberian state intends to carry on with the cooperation. This intention is also clear from a memorandum of understanding between the two parties,

signed at the end of 2018, in which Portugal expressed its desire to cooperate with China in the latter’s Belt and Road Initiative (BRI). The Portuguese government has an actual plan for this: they have already started to negotiate the large-scale project of enlarging the Southern Portuguese freight container port of Sines with the Chinese. Besides, Portugal was the first eurozone country to announce that it would also issue the so-called “panda bonds,” denominated in renminbi. Therefore, it seems today that Portuguese−Chinese relations still have a lot of potential.

Relations between Spain and China, like those between China and Portugal, have a long history and date back to the Age of Discovery. Spain established diplomatic relations with the People’s Republic of China in 1973, and the two countries’ political relations have since been developing in a balanced way, just as they have done in the case of Portugal. No matter what party has ruled the county, Spanish governments have always aimed for good relations with China and have stood behind Chinese interests in European politics, too. After the 1989 events on Tienanmen Square, Spain was the first EU member state whose foreign minister visited China, and the Spanish government has always refrained from taking a stance on political questions sensitive for China, such as the question of Taiwan or Tibet, also suggesting that the EU should lift the embargo on arms trading against China in 2010. The Chinese leadership appreciated the Spanish commitment to maintaining good relations, and, at the beginning of the 2000s, referred to Spain as “China’s greatest European friend. country’s”

While their political ties are balanced and good, the two countries’ economic relations are more controversial. Similarly to other EU member states, trade relations between Spain and China have developed dynamically since the early 2000s. The financial crisis, which heavily impacted the Spanish economy, opened the way for Chinese capital. China bought up a significant part of the Spanish national debt and became the country’s second-largest foreign creditor.

Chinese investment in Spain started to increase after 2012, but, in keeping with the trend elsewhere in Europe, it mostly consisted of acquisitions instead of greenfield investments. In Spain, the most important target sectors for Chinese investment are real estate, telecommunications, renewable energy (wind and solar), and leisure and tourism—a good example of the latter is when Chinese investors bought a share in the football club Atlético Madrid. Although Chinese investment reached a total of around EUR 4.6 billion by 2019 (which is the ninth-highest amount among the EU member states), it still fell short of Spanish expectations (by comparison, Portugal, whose population is only one-quarter of that of Spain, received EUR 1.4 billion more of Chinese investment). Spain also launched

an investor-visa programme in autumn 2013, which became equally popular among Chinese nationals.

Yet another similarity between the two countries is that Spain not only provides access to European markets, but acts as an intermediary through its former colonies, most importantly in Latin America. A remarkable investment was when Sinopec purchased a 40% share in Repsol Brazil, an earlier Spanishowned oil exploration and extraction company, which operates in the biggest Latin American country. Similarly to Portugal, China is also interested in Spain itself because of its excellent location for sea trade. A Chinese shipping company, COSCO Shipping, acquired a 51% share in the freight container ports of Bilbao and Valencia in 2017.

The Spanish public often voices strong criticism over Chinese economic activity, and— unlike in Portugal—the Spanish government has in recent years adopted a somewhat more cautious stance towards it because of the imbalances in Chinese−Spanish economic relations. Spain has been considerably more active than its Iberian neighbour in EU negotiations on regulating Chinese investment and trade, as it wanted to create a more advantageous investment and trade climate for the country in its relations with China. Spain did not sign any BRI memorandum of understanding either, since the government claimed it was not clear whether the country’s economy could profit from this cooperation. Finally, the Spanish prime minister also actively supported the European Commission’s new China strategy in 2019, which identified the Far Eastern country as a challenger to the EU for cutting-edge technology and a systemic rival, promoting an alternative governmental model. Yet, all this meant no sharp turn in Chinese− Spanish relations.

Overall, both Iberian countries maintain excellent political relations with China, and both have been important targets for Chinese capital in the last decade. In Spain, there is, however, a certain shift towards policies that intend to represent the country’s economic interests better and put Chinese economic activity in a more critical light.

The Chinese–Greek bilateral relations have been on a steady rise since 2006, when the two nations upgraded their multilevel cooperation to a strategic partnership. This led to strengthened bilateral cooperation and a series of high-level visits by both countries’ top officials.14 Fitting into this pattern, Greece has in recent years joined the 17 + 1 framework and the Belt and Road Initiative after the Port of Piraeus became a major target for Chinese investment during the last decade. With deepened cooperation, both sides hope for successful synergy that extends into the future. Although the constant enhancement of bilateral ties has certainly produced remarkable results, the increased Chinese presence in the Mediterranean country

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led to retaliation from the US and the EU (albeit only in recent years) and, in some cases, to harsher rhetoric on Greece’s political and economic closeness to the Asian country. But how did improving ties become a problem for the West, and in what ways was the economic cooperation enhanced?

To put these questions into perspective, one must first look at the aftermath of the 2007–2009 global financial crisis, which pushed Greece into a sovereign debt crisis in late 2009. For these reasons, the government had to take certain steps to overcome its EUR 300 billion debt (reaching a debt-to-GDP ratio of 179%, the highest among countries in the eurozone) to survive financially.15 The European Union (EU), the International Monetary Fund, and the European Central Bank, a trio at the time referred to as the “troika” by the media, persuaded the Greek government to start to privatise certain assets. This kind of revenue generation began by selling shares of companies and rights of operation in certain sectors. One of the most important sectors in question was the Greek shipping and container industry.

That is why the Port of Piraeus has become so important in recent years, and that is how the Chinese economic presence in Greece started to increase. With tightening economic and political ties between the two countries, Piraeus has become the most important container hub in the Mediterranean region, creating more than a thousand new workplaces, after COSCO—a Chinese government-owned shipping and logistics services supplier company, which became COSCO Shipping following a merger in 2016—acquired the rights of operation for one of the container terminals in Piraeus in 2009.16 Its quadruped container, throughput in less than five years, shows that the terminal could see an almost immediate boost in competitiveness.17

However, the Greek government needed much more liquidity in order to limit the damage caused by falling GDP figures.18 For this reason, China established itself as one of the most important trading partners for Greece in the following years, and, as it usually happens, the more capital Beijing invested, the more influence it started to gain over the country. The question about China’s possible long-time strategy in the region started to be viewed with some scepticism as early as the first years of the 2010s, but, in 2013, many experts concluded that the growing Chinese economic presence in Greece did not represent a “major concern with regards to Greece’s international

Talks between Prime Minister Kyriakos Mitsotakis and

President Xi Jinping in 2019

position”.19 Therefore, the possible reason for enhancing ties could be that Athens hoped for mutually beneficial economic cooperation and the continuation of the steady rise of bilateral trade that started at the beginning of the 2010s.

In 2013, Chinese president Xi Jinping announced the Belt and Road Initiative, which would serve as the New Silk Road (and New Maritime Silk Road) running along the lines of the ancient Silk Road and connecting Europe with Asia and Africa in an ambitious framework. In the meantime, Greece became a major hub for Chinese economic relations in the Mediterranean region. Until 2013, COSCO invested approximately EUR 570 million in the Port of Piraeus with the promise of additional investments in the future. As the EU’s bailout package was not sufficient to overcome the downward spiral that the Greek economy got itself into, the continuous waves of privatisation led China to capitalise on the situation by increasing the role of COSCO in the port.

Because of COSCO’s increased involvement, Piraeus soon became the world’s fastestgrowing container port, and its increased relevance led some analysts to conclude that Chinese investment in Southeastern European transport infrastructure could lessen the trade flow facilitated by Western Europe between Central Europe and Asia.20 The investment, of course, was more than welcomed by the Greek government at the time, which was still struggling and was in desperate need of foreign capital. While some certainly hoped that the new investment would help the Greek economy overcome instability, others continued to fear the increasing Chinese foothold in Southern Europe.

The new maritime-infrastructure construction led by China also made the EU start taking into account the consequences of a more visible Chinese presence at its doorstep. Some even feared that China might gain too much leverage over trade with the EU, which adopted a more cautious stance as the enormous BRI projects were announced.21 The geopolitical implications of the Chinese–Greek relations still lingered, and the need for increased investment and the promise of further development plans made the risks associated with growing Chinese influence much less important for the Greek government. This did not mean that there were immediate risks stemming from the improvement of economic and political relations with Beijing—some experts even stated that “this development should not cause serious concerns at a European or transatlantic level” as long as the foreign or security policy dimensions of the Southern European nation are not harmed.22

Positive views on this new wave of Chinese investment included the redefinition of the Mediterranean region as an important strategic area for China, which not only helped boost the Greek GDP but also played a crucial role in facilitating and redefining geopolitical relations in Europe. This meant that the increasing attention of China might also arouse the interest of regional, continental, and even global actors, which could lead to some sort of competition in certain areas. This might ultimately result in increased investments and enhanced relationships with other nations in the long term. The people who saw the growing Chinese presence as a negative phenomenon when the investments started flowing into Greece did so because they feared that the Chinese strategy would exploit “European weakness” and “hinder the process of integration.”23

China not only signed another investment deal worth roughly EUR 216.8 million in 2013 but also invested almost USD 8 billion (i.e., more than EUR 6.6 billion) in upgrading the Athens

airport and constructing the Crete airport.24 This spending helped build up Geeks’ trust in China, which ultimately led to an additional EUR 368.5 million investment from COSCO Shipping in the port of Piraeus in April 2016. The same investment deal entailed the arrival of the second wave of capital worth more than EUR 280 million, by which the company could acquire 51% ownership in the Greek port. The Chinese company also promised an additional EUR 88 million investment, which would mean acquiring a further 16% of the port’s shares in a five-year period.25 By taking the majority ownership of the port, China officially entered the doorstep of Europe. Soon after the investment had been signed, Greece officially joined the Belt and Road Initiative during the summer of 2018, when Greek foreign minister Nikos Kotzais, signed a memorandum with China. This document included the further deepening of the two country’s relations by highlighting that the Chinese initiatives were aimed at promoting investment in infrastructure, connectivity, and economic cooperation in general.26

At the same time, Chinese investment did not stop in Greece but also arrived at the most important European ports. Chinese companies managed to exert control over one-tenth of the total European container traffic: their position was made even stronger after acquiring Zeebrugge, the second-largest Belgian port, 51% of the Port of Valencia, and some smaller Northern European ports, too, until 2017.27 With these investments, China acquired some stakes in twelve European ports until 2019, including Dunkirk, Istanbul, Rotterdam, Marseilles, and Bilbao.28

Following the increasing Chinese presence and ownership in the above-mentioned European ports, and Italy joining the BRI at around the same time, French president Emmanuel Macron said in 2019 that “the period of European naiv[i]t[y] is over,” while German chancellor Angela Merkel highlighted that “although China is a partner, it is also a competitor with a different political system.” All this happened just after the 17 + 1 cooperation and Greece’s participation in BRI had been strengthened again, with the Port of Piraeus being gradually expanded by an additional wave of investments in November 2019, which had been worth EUR 600 million and had been designed to improve the port and its surrounding infrastructure.29 Some experts also warned about the possibility of a debt trap along the lines of the Chinese Belt and Road Initiative, including the port of Piraeus, too.30 A year later, the US also expressed concerns about the possibility that China might use the port for military purposes, and Washington even tried to push Greece to stop acting as

EU member states’

participating in the 17+1 Non-EU member states’

China’s “head of the dragon” in Europe31—and expression coming from Xi Jinping, who called the port so during his visit to Greece.32

Criticism from the Western nations did not hinder the Greek government’s cooperation with China. This was made clear in the summer of 2020, when Adonis Georgiadis, the Greek development and investment minister, said during an online investment forum that his government was “very happy with the Chinese presence in Greece, very proud of [the] cooperation in Piraeus port” and that Athens “want[ed] to go forward with the master plan of the upgrade of Greece’s largest harbour.”33

Besides the above mentioned factors, the cooperation between Greece and China during the pandemic—especially during its initial phase—is another important reason that explains the Greek government’s increased openness towards Chinese investments. China delivered eighteen tons of medical supplies to the Greek government, which, in turn, decided to strengthen the partnership between the two nations even further and developed a more positive China policy, supported by the new Greek prime minister Kyriakos Mitsotakis, who was elected in July 2019.

Unlike the former government, which adopted a more cautious approach towards China, the Mitsotakis cabinet thinks that inviting more Chinese investment is an entirely positive step. The previous government’s approach towards China, which stopped additional Chinese investments in the Port of Piraeus, was among the reasons why it got fewer votes than Mitsotakis’s party, as the current prime minister voiced his concerns about the slow economic improvement during his campaign.34 The new Greek government approved the investment plans for the next stage of development in Piraeus just a couple of months after taking office, but selling the previously promised further 16% stake to COSCO Shipping has not yet been authorised. Although the port’s promised additional expansion by the Chinese company should have been completed by January 2021, COSCO wanted to acquire further stakes, even before fulfilling the previous agreement, which would mean more money invested in the port. Meanwhile, the Piraeus’s chamber of commerce and the Greek shipping chamber managed to prevent COSCO Shipping from holding operational control over a new electronic portaccess system by joining the protest against the Chinese company, which has been started by the workers at the port.35 These actions made some Greek politicians and a part of the population question the overall success of the investment programme—just as the rest of the EU does, where doubts have also risen about the Chinese company’s real ambitions.36

The EU Chamber of Commerce in China examined the basic premises and business model of COSCO Shipping in Piraeus and found that “the rapid growth of both capacity and actual throughput ha[d] largely been achieved by COSCO using Piraeus as a hub for international relay.”37 Another report stated that, in China, “international relay may only be carried out by Chinese-flagged vessels operated by wholly-owned Chinese companies,”38 which ultimately creates an awkward disparity between the EU and China within the framework of international trade. This disadvantageous situation eventually led the Danish shipping company Maersk, a rival to COSCO Shipping in Europe, to propose that Brussels should consider “blocking nonEU ships from relay services”39 in order to achieve reciprocity with Beijing in the area, even considering the 17% growth of freight throughput in Piraeus in 2019. Since Piraeus is the only port in the EU where a single company has a controlling stake in the overall port and not in just one or more terminals, some experts have set off alarm bells because of the potential dangers of a single company controlling such a strategically important piece of infrastructure.40

All in all, the increased Chinese involvement in the Greek economy, especially in the Port of Piraeus, led to stronger bilateral ties between the two countries, which tightened considerably, in particular after the 2019 election of the Mitsotakis government. With Mitsotakis as the Greek prime minister, a supporter of Chinese investment in the country, it seems that Athens

will continue inching closer to China in hopes of overcoming Greece’s financial difficulties. This intention was also confirmed by the announcement that 2021 would be the China–Greece Year of Culture and Tourism, aimed at restarting the country’s tourism sector, which has, by far, the largest share in the Greek economy.

Following the trends of the latest years, it seems that a real win-win situation is emerging from the cooperation between Beijing and Athens, although Chinese capital comes to Greece in the form of loans and acquisitions in different sectors of the Greek economy. While some Western critics claimed that a debt trap was forming in the Mediterranean country, its overall economy has, so far, seen a great improvement as a result of the increased amount of Chinese investment. From a Greek perspective, the gradually growing amount of investment from China gives hope for a faster recovery, while, from a Chinese perspective, if the New Maritime Silk Road becomes a success, the Port of Piraeus will be a stronghold for exporting Chinese goods to Europe.

With the EU becoming more conscious about the risks associated with Chinese strategies and with the growing confrontation between the West and China, the EU, with France and Germany at its helm, and also the US, will have to provide Greece (as well as the other European countries in the 17 + 1 cooperation) with some viable alternatives to Chinese investment. If such steps were taken, they might help balance the role of the Asian country and the Western nations, and, therefore, prevent the Southern European country from becoming a stronghold of Chinese influence. Strengthening bilateral ties and the medical aid provided by China during the pandemic to those European countries it has closer ties with certainly did not help the Western strategic positions in Greece and, more widely, in Eastern and Southern Europe. In 2021 and the coming years, the greatest task of the EU and the US is to provide Greece with the tools to tackle the pandemic and to restart its economy and to make it more sustainable and resilient in order to finally overcome the spiral of crises from where the Southern European country has not been able to get out of for more than a decade now.

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