The Essence of China’s Investment in European Ports: A Mutually Beneficial Cooperation

Professor Theodoros Syriopoulos Port Management and Shipping Department 
School of Economics and Political Sciences National and Kapodistrian University of Athens

Following its accession to the World Trade Organization, and over the last four decades, China has been transformed from a peripheral developing economy into a major, highly dynamic economic player in the global system. China’s total exports in 2024 were valued at USD 3.6 trillion, ranking the country as the top exporter worldwide. With regard to EU-China trade relations, China is the second-largest EU trading partner with bilateral trade value reaching at USD 845 (€732) billion in 2024 alone. Over the last twenty years, China has developed a series of overseas investment initiatives, targeting to enhance connectivity and ensure a stable global supply chain, facilitating Chinese trade flows worldwide. To that end, China deploys an array of investment projects, including transportation systems (ports, railways, highways), and logistics parks, inter alia. The Belt and Road Initiative (BRI) is China’s flagship towards globalization with the development of efficient supply chain pathways.

Chinese Port Investments

With a focus on the port industry, the acquisition of share in port terminals and the participation in concession tenders have been proved to be flexible vehicles for Chinese port investments worldwide. Empirical evidence indicates that China’s strategy in Europe is not confined to any specific region but is geographically dispersed to serve different entry routes: from the South (Mediterranean) to build links with the Balkans and Central Europe; from the West (Spain) to access France and the Atlantic; and, from the North (Belgium) to directly connect to Europe’s industrial zones. This dispersion not only maximizes access but also reduces dependence on any single node or route. It is a smart strategy integrating geographic flexibility with operational   efficiency; thus, these port terminals have become important nodes for promoting exchanges between Europe and China. The engagement of Chinese companies in port terminal operations is seen to also have a highly positive impact on port throughput traffic, promoƟng extensive capital investments to develop exisƟng port infrastructures and superstructures, creaƟng additional employment positions, enhancing income mulƟplier effects and consistently promoƟng port connectivity in the global sea transport networks, inter alia.

Key European Port Case Studies

To illustrate the economic analysis, a series of port cases is briefly mentioned. As of the port of Piraeus case, amidst the worst financial crisis hit the Greek economy, a 51% share percentage (plus a percentage share of 16%, a few years later) of Piraeus Port Authority S.A. was acquired by China COSCO Shipping. Since the COSCO’s involvement in 2008, the port’s annual throughput capacity has been raised from the initial 0.68 million TEUs to 4.8 million TEUs in 2024. Between 2016 and 2024, the port of Piraeus experienced an increase in ferry traffic (in passengers) by 12.4% and in cruise traffic (in passengers) by 55.3%. Piraeus port has developed into the fourth largest container port in Europe, the third largest cruise homeport in Europe, and the largest ferry port in Europe. Meanwhile, the Piraeus port has directly created 4,300 jobs and indirectly created 12,000 jobs in Greece, boosting Greece’s GDP by 1.56%. The concession of Pier II and the development of Pier III at the Piraeus Container Terminal (PCT) to COSCO, in 2008, and the share sale in 2016, safeguarded a total of €845.8 million in investments and €418.5 million in upfront payments without considering the annual payments throughout the concession period. As a result, the Piraeus Port Authority S.A. is seen to have more than doubled its revenues between 2016-2024 (+123%) with an EBITDA increase by 425%. In the port of Bilbao case, in 2016, COSCO acquired a 51% percentage share of the company operating Dock 1 and 2 of Bilbao Container Terminal. The agreement foresees an investment of €34.0 million in ports and railway infrastructure. Despite COSCO’s engagement, container traffic is seen to have decreased by 23.1% between 2016-2024. This is partly due to the fact that the port of Piraeus attracts a large number of container ships to dock there. In the port of Valencia case, in 2016, COSCO acquired a 51% share percentage of a container terminal, in a deal valued at €203.5 million with compulsory investments of €88.5 million. Between 2016-2024, the container traffic (in TEUs) at the port of Valencia increased by almost 16%.

Main Empirical Findings

The empirical economic analysis unveils a dynamic, efficient and well-organized investment strategy of Chinese port operators to expand their operations in the port industry worldwide. This has underlined the strategic role of China, aiming at developing and maintaining efficient supply chain networks on a global scale. Most ports that have welcomed Chinese investments are seen to have recorded impressive growth rates in throughput (especially container) traffic, robust financial revenues, solid increases in employment posiƟons and diverse income mulƟplier effects. The association of Chinese port operators to a world top shipping operator (COSCO) creates valuable financial and operational synergies that are highly beneficial to ports. The engagement of Chinese companies is also accompanied by significant capital investments in port infrastructure, superstructures and hinterland connectivity infrastructures. These investments also generate solid income multiplier effects and support the creation of significant employment posiƟons. China is the world’s largest trading nation in goods, and its shipping fleet is second only to Greece’s. COSCO Shipping Group boasts the world’s largest fleet and the world’s fourth-largest container ship fleet. These factors ensure that China can bring stable cargo flows to the ports it invests in. Despite concerns raised in relation to the Chinese investment growth in EU ports, such as potential geopolitical influences, and dependence of a port system and its national trade flows, these concerns are largely based on ideological speculation and lack much factual basis. There is no factual evidence to suggest that Chinese investment in European ports poses any threat. These investments, nevertheless, reveal a rich spectrum of economic and social benefits at local and national level. It remains in the hands of port authorities or policy makers to exploit the advantages suitable in each case more efficiently, selecting an appropriate governance structure model and shareholder ownership allocation  scheme. After all, the essence of business cooperation is mutually beneficial for the partners involved and generates win-win results.