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Greece targets Chinese investors for sale of state assets

  • Staff Reporter
  • 2012-12-13
  • 11:28 (GMT+8)
Protesters in Athens. (Photo/Xinhua)

Protesters in Athens. (Photo/Xinhua)

Chinese investors are optimistic but wary of investing in Greece as the struggling country redoubles its efforts to cut debt and stoke its economy through the sale of state assets and privatization, reports the Guangzhou-based Southern Weekly.

"It's the appropriate time for international investors to consider investing in Greece," said Panos Protopsaltis, corporate planning manager and investment program general coordinator of the Hellenic Republic Assets Development Fund (HRADF), at a promotional event for a €50-billion (US$65.4 billion) privatization program in Shanghai on Nov. 30.

The Greek debt crisis has been festering for the last three years after the country's credit rating was downgraded, putting Greece on the verge of bankruptcy and making it reliant on debt relief provided by the EU, the European Central Bank and the International Monetary Fund under certain conditions.

To meet the conditions and raise funds to avoid defaulting on its national debt, the Greek government announced on Sept. 20 that it will sell some of its state assets.

The HRADF is responsible for the sale of the assets and for promoting national development. The 26-member HRADF taskforce has visited Europe, the Middle East, Russia, the Untied States, Canada, South Korea and China since its establishment in July 2011.

The Greek government has high expectations of Chinese investors more so than any other region around the world, a Chinese official in charge of Greek economic affairs told Southern Weekly.

Chinese private investors already began visiting Greece to seek opportunities for investment in hotels, olive orchards and wine villages in the first half of the year.

To remain in the eurozone, Greece promised in 2011 to reduce the nation's debt to GDP ratio to 124% from the current 170.6%, mainly by selling its state-owned assets. The country set a target of selling state assets totaling €50 billion, of which 55% will come from property sales, 35% from the sales of infrastructure-construction facilities and 10% from the sales of large companies.

The Southern Weekly noted that the plan was considered the world's largest privatization promotion program since the Second World War.

On the other hand, Chinese investors targeting Greece have attempted to buy these assets at bargain prices.

Over the past five years, the total output of Greece's economy has shrunk by 30%, while the unemployment rate reached 24.5% and labor costs dropped by 25%. It is undeniable that the value of all assets in Greece has been falling.

Greece is said to believe that asset privatization will not only increase government revenue and jobs but will also be conducive to the operation of these entities and to overall economic development.

Who's Who

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    Hu Huaibang (胡懷邦)

    Hu Huaibang is commissioner of disciplinary inspection at the China Banking Regulatory Commission. He was educated at Jilin University and in 1999 ...