Second stage of tender for expansion of Thessaloniki port Pier 6 completed

Thessaloniki, Greece (PortSEurope) February 8, 2021 - The submission of binding financial and technical offers for the second stage - Call for bids for the selection of the contractor for the project 'Expansion of the marine works infrastructure of Pier 6 of Thessaloniki port - was completed, Thessaloniki Port Authority (ThPA) said. This project is the most important part of the mandatory enhancements undertaken by ThPA SA in the context of its concession agreement with the Greek state. The extension project has a budget of €130 million ($156.6 million). According to ThPA, this project enhances the position of the Port of Thessaloniki in the global port industry and the supply chain sector while offering strong exponential benefits to the economy and society, at local and national level. Binding financial and technical offers were submitted by five tenderers: Archirodon Group NV (Greece); consortium Intrakat Constructions SA (Greece), Intercantieri Vittadello SPA (Italy), Sales SPA (Italy); joint venture Mytilinaios SA (Greece), Rover Maritime SL (Spain), HDK SA (Greece); joint venture Avax SA (Greece), Etermar SA (Portugal), NV Besix SA (Belgium); joint venture Acciona Construccion SA (Spain), Dredging International NV (Belgium). A Terna-Vinci consortium decided not to submit an offer. ThPA was privatised in March 2018 and was operated by South Europe Gateway Thessaloniki (SEGT) Ltd., a consortium, in turn, owned by Germany’s Deutsche Invest Equity Partners (DIEP) with 47%; France’s CMA CGM (Terminal Link) with 33% and Savvidis Group (Cyprus-registered Belterra Investments) with 20%. Terminal Link is 49% owned by China Merchants Port Holding, which is controlled by the Chinese state. Russian billionaire of Caucasus Greek origin, born in Georgia, Ivan Savvidis acquired in January the 47% stake in Thessaloniki port owned by Germany’s DIEP. Savvidis, "the Russian tsar of Thessaloniki", according to local media, already owns 20% and now will control 67% of Greece’s second largest port. Greek Competition Commission has yet to approve the deal. CMA CGM (Terminal Link) retains its 33% in South Europe Gateway Thessaloniki, a consortium that operates ThPA. Savvidis (Savidi, Savidis) was embroiled in numerous scandals and controversial situations in recent years. The owner of the Greek PAOK football team, hotels and a former member of the Russian State Duma (lower house of parliament), according to an investigation, has transferred hundreds of thousands of euros to structures working against the change of the name of neighbouring Northern Macedonia. He also participates in the manufacture of cigarettes and sugar and is seen as one of the most powerful investors in Northern Greece. Savvidis name appeared in publications about the coup attempt against Montenegro then-Prime Minister Milo Djukanovic in 2016. In March 2018, he went to the football field with a gun during a match of his own football team. Russian President Vladimir Putin, with whom he has cordial relations, awarded him in 2019 for "many years of conscientious work" and "achievements in labour". Thessaloniki Port Authority has started in November 2020 a hinterland expansion with its first intermodal terminal (dry port) in the capital of neighbouring Bulgaria (in Iliyantsi/Ilianci, Sofia). The dry port, to controlled by the subsidiary ThPA Sofia, is part of the port’s strategy to become a gateway to the Balkan region. It is located 230 km north of the port and will be linked by train directly to the Port ssaloniki, providing competitive transit times and costs. The new dry port aims to become an important trade hub and a modern development centre, which will be linked by train with a range of dry ports in South-Eastern, Eastern and Central Europe, playing a decisive role in strengthening the export activities of a wide range of businesses, according to a Port of Thessaloniki statement. In the first half of 2020, the total revenues of ThPA were €34.29 million compared to €32.95 million, an increase of 5.3%. The increase is due to additional revenues from the container terminal of €2.9 million (+14.3%) and the reduction of revenues from the conventional cargo terminal by €1.2 million (-10.3%). Total operating cost increased by 12.3% due to compensation paid to executives who resigned in accordance with the decisions of the Ordinary General Meeting in June. For more information about the controversial Russian and Chinese involvement in the Port of Thessaloniki, read our analysis Thessaloniki port seeks exit from Piraeus shadow; Chinese and Russian interests. The consortium of new owners of the port South Europe Gateway Thessaloniki (SEGT) are advancing their investment program aiming to build a transport hub linking the Mediterranean with the Balkan countries. Indirectly, both Russia and China have stakes and interests in the port, which has raised concerns in the European Union (EU) and the United States, and the port has become the subject of wide geo-political interest. The Chinese government continues to invest in port facilities as part of its new Silk Road policy, and the Brussels and Washington have been highly supportive of the newly-named Republic of North Macedonia and its entry into the North Atlantic Treaty Organization (NATO). At the same time, Russia has been trying to develop its political and business links to the Balkan and central European countries which were under the hegemony of the former Soviet Union. SEGT paid €232 million ($287 million) for Thessaloniki port, but the full benefit of the deal for ThPA will be €1.1 billion ($1.36 billion) as it also includes the consortium’s commitment to invest €180 million in the next seven years, capitalising on the port’s location as an export gate for the wider Balkan area (especially for the landlocked Serbia, Northern Macedonia and Kosovo). The SEGT consortium members have agreed to spend €650 million on upgrading the port’s facilities over the 34-year concession. The facilities have not had a major upgrade since the 1990s. The focus of attention in Greek’s ports privatisation is on the port of Piraeus, taken over by China’s state owned COSCO, which has invested €550 million in its development, while Thessaloniki operates under the radar, but quietly builds portfolio of clients in Bulgaria and in the former Yugoslav republics and aims to become the greatest transit hub in the Aegean Sea. Executive Chairman and CEO of the Thessaloniki Port Authority is Sotiris Theofanis, who was previously its CEO from 1999-2002. From 2002 to 2004, he was a CEO of Piraeus Port Authority SA. ThPA SA announced on January 25 the resignation for personal reasons, from the Board of Directors (BoD) of Boris Wenzel, Deputy Chairman of the BoD, non-executive member. Wenzel is Managing Director at Terminal Link SAS. The main focus of the €180 million investment in the port of Thessaloniki, expected to be completed ahead of schedule for under five years, is the extension of the container terminal by 440 metres and dredging works that will increase the port’s depth to 16.5 metres, which is strategic in providing a berthing place to accommodate the so-called New Panamax vessels especially the ships coming from East Asia. The port also plans to develop a freight centre, to be tendered by Greek state-owned railway property management and development company GAIAOSE, and the cruise tourism sector. It has already been announced that a new area of 26,000 m² will be available for the temporary storage of containers to be exported, which is part of the gradual redesign of the overall operation of the container terminal and of the new investment program. Of the investment, €130 million has been allocated to 6th Pier projects, €30 million to equipment for the container station and the dry cargo facility and €20 million for static reinforcement at the old customs office, as well as other port development projects. Improved facilities will enable the port to handle larger vessels and thus increase container volumes. The agreement does not include the sale of port infrastructure, which has been leased to the Thessaloniki Port Authority via a concession until 2051. The port of Thessaloniki is of prime strategic importance for the North Atlantic Treaty Organisation (NATO), as well as for the Russians and the EU. It is the connecting link between Asia and Europe, by-passing the Turkish Straits (Bosphorus). Not much attention was paid even by the specialised media on Chinese involvement in the privatisation of both Piraeus and Thessaloniki ports. But even less information was published about the Russian link in the privatisation of the Port of Thessaloniki – Belterra Investments, owned by Savvidis. He is considered to be from the inner circle of Russian President Vladimir Putin, alleged to have tried to influence government policy and is said to have the ear of the former Greek Prime Minister and radical left SYRIZA leader Alexis Tsipras. Savvidis, 62, who made his fortune in agriculture and tobacco in southern Russia, has had an arrest warrant (but has never been detained) issued against him for bringing a gun onto the field to protest a referee’s decision. He is among the top 50 richest Russians with estimated wealth of $1.6 billion. Over the past decade, Savvidis has invested in northern Greek businesses, some on the brink of collapse, as well as in media – television stations and newspapers – that are generally supportive of SYRIZA. Allegedly, he has been using his wealth and connections, despite not being fluent in Greek, to carry out what critics describe as double-dealing for Russia. Media publications, that cannot be independently verified, claim that Savvidis seems to have a lot of influence in Thessaloniki, and that U.S. and Greek officials believe he’s a straw man for Russian President Putin’s interest in the country and the Balkans. The New York Times newspaper said that U.S. officials in June intercepted communications showing Savvidis was working as Russia’s agent to undermine the name deal with the Former Yugoslav Republic of Macedonia (FYROM), which the West strongly backed to gain entry for what would become North Macedonia into NATO as a bulwark against growing Russian interests in the Balkans. A senior U.S. official told the New York Times that U.S. agencies were able to easily collect financial data that put Savvidis behind payments to citizens and soccer fans to incite violence against the FYROM referendum for the country’s name change. According to the Organized Crime and Corruption Reporting Project, an investigative reporting organisation, Savvidis paid opponents of the campaign to rename FYROM at least €300,000. Savvidis strongly denied all charges. He was a member of Putin’s party, United Russia, when he was in the Duma, the lower House of Russia’s Parliament. Copyright (C) PortSEurope. All Rights Reserved. 2021.

Second stage of tender for expansion of Thessaloniki port Pier 6 completed

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Second stage of tender for expansion of Thessaloniki port Pier 6 completed

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