How Greece’s Busiest Port Reveals the Perils of Privatization

How Greece’s Busiest Port Reveals the Perils of Privatization

How Greece’s Busiest Port Reveals the Perils of Privatization

Dockworkers say the same “harsh neoliberal experiment” that reduced their wages will spread to the rest of Europe.

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Around 7 am at the Port of Piraeus near Athens, deckhands dressed in white began to unmoor the cruise liners and yachts filled with thousands of sleepy travelers ready to cross the Aegean Sea. But as the tourist trade picked up in the passenger and cruise terminals, some of the hundreds of dockworkers in the port’s northern cargo terminals were just ending their shift. All through the night, fleets of ships with colossal logos—MAERSK LINE or MSC SHIPPING—slice through the wine-dark waters of the Saronic Gulf toward Piraeus, with loading gangs and cranes always ready to offload their mass-produced cargo.

Being a longshoreman can be difficult at any time, but working when it’s still dark is especially demanding, explained Nikos Kleonakos, a 46-year-old who has been moving containers on and off of cargo ships for over a decade: “At Piraeus, the better shift is the morning shift, as there is light and you can see everything. The tops of the cargo containers are often quite slippery from the sea salt, and the light helps when you unscrew the rusty twist-locks that bind the containers together.”

The 40-foot straddle-carrier cranes that help Kleonakos and others move shipping containers are barely 10 years old, but Piraeus’s development stretches back to at least the 5th century BC, when the Athenians fortified the port after fending off Persian forces under the leadership of Xerxes.

These days no one in Greece is worried about an invading army, but a new Asian power is trying to use Piraeus as its entryway into Europe: COSCO Shipping, a Chinese state-owned enterprise and the world’s largest shipping company. In 2016, COSCO took over the management of Piraeus, which it calls the “dragon head” of its European operations. To live up to its motto—“Bridging the East with West”—the company relies on the port as a crucial node in what’s perhaps the world’s most sophisticated supply chain.

Though the Greek government and Piraeus Port Authority say they are excited about the quadrupled increase in cargo volume since 2010, Piraeus workers told me COSCO’s push for cheap, subcontracted labor is a threat to their livelihoods—which generations of workers fought to obtain. More generally, they said the ongoing privatization of publicly owned companies in Greece is prioritizing the rich over the poor. “Since privatization, people at the docks feel that our livelihoods and basic labor rights are under threat.… We’re dealing with COSCO and the private sector, and our welfare simply isn’t as important as it was to the government,” said Thanos Khanatios, a 53-year-old dockworker from Piraeus who has been working at the port over the past 30 years.

In 2015, as a condition of the $100 billion European Union bailout that followed the 2008 financial crisis, the Greek government agreed to privatize a number of state-held assets including the Piraeus Port Authority, which manages the port’s container and passenger terminals. The Greek state sold a majority stake for $330 million to COSCO. For the Chinese company, the purchase had a clear financial logic. About 80 percent of China’s imports and exports to and from Europe are transported by sea, and by avoiding the need to sail to busy Northern European ports like Rotterdam or Hamburg, COSCO could offload containers in Piraeus, reducing the time it takes cargo to get to Europe by nearly a week. Plus, by owning the port authority, COSCO could help determine how much its own ships would have to pay itself in port fees.

As part of the deal, COSCO pledged to participate in financing $410 million worth of investment in the port, including a repair of port equipment and the dredging of Piraeus’s central port. Supporters of privatization argue these improvements signal a coming maritime renaissance at Piraeus—already the busiest port in the eastern Mediterranean. Nektarios Demenopolous, the deputy manager for investor relations at Piraeus Port Authority, told me, “There are 300 million euros [$350 million] of investment to come in the next five years, followed by another 50 million. Privatization has made the port much more dynamic and will reboot activities at the port like ship repair that have been in recession. It will be remembered as a success story.”

But a “success story” for whom? The dockworkers of Piraeus say they and their families have seen little of the alleged gains brought by COSCO. As Piraeus Port Authority boasts of widening profit margins and increasing maritime traffic, wages for dockworkers haven’t budged since they were slashed from 1500 euros ($1,750) per month to 600 euros after the financial crisis. Beyond that, COSCO now hires few dockworkers as full-time employees, and tends to enlist unskilled laborers for complex container unloading. COSCO also primarily remunerates people on an ad hoc basis as subcontractors, leaving dockworkers and their families entirely dependent on the ebb and flow of traffic into Piraeus. It also means their traditional retirement benefits have disappeared.

“There’s a lot to be worried about. Health and safety conditions have gotten worse for us. Wages are stagnant. The complex system of subcontractors is a wound for labor relations, as the company brings in unskilled workers but then says it is not liable for safety risks,” Khanatios told me.

The long list of Greek public assets in the privatization pipeline includes Athens International Airport, the oil refiner Hellenic Petroleum, and the electric-grid operator. To date, some roughly $5 billion in Greek state assets, including the Port of Piraeus and Greece’s regional airport network, have been sold, and it is expected that the Greek government will sell nearly $55 billion worth of state assets within the next decade.

There is no conclusive evidence that privatized state assets are more efficiently managed than their state-owned predecessors, but privatization is undoubtedly an effective means for a cash-strapped government to raise funds when its creditors are getting impatient.

“Piraeus was always a profitable port. However, it is clear there were strong interests to see Greece’s public wealth turned over into other peoples’ hands,” said Giorgos Gogos, head of the Piraeus dockworkers’ union.

Last year, the Greek economy grew by 1.4 percent after a nearly decade-long recession, but the country’s recovery hardly marks “a new chapter of growth ahead,” as some of the European Union’s chief economists would like to suggest. An estimated 15,000–20,000 young Greeks are still leaving the country every month to search for work elsewhere in Europe. More than one in five Greeks could not afford to cover their basic needs in 2017. Unemployment has been well above 20 percent for seven consecutive years. Despite the fire sale of public assets, the Greek government’s outstanding debt still totals almost twice the size of the country’s gross domestic product.

Meanwhile, the proliferation of low-paid, flexible employment in Greece, like at Piraeus, has likely hampered the pace of economic growth by throttling private consumption.

“No matter what the government and Greek mass media say about development, I doubt that COSCO’s ownership of the port will revive the local economy. The situation right now and over the past years simply could not lead anyone to think so,” said Kleonakos.

Instead, they see COSCO’s intervention as a convenient way for a powerful corporation to cheaply buy Greece’s port and use the legacy of the financial crisis to reduce wages and working standards to levels not seen in Greece for decades.

“In previous years, dockworkers were demanding for more, better conditions. Now, we are just fighting to remain where we are,” Khanatios told me.

Without much support from the Greek government or any of the European institutions, the odds appear to be stacked against the dockworkers at Piraeus, but they say they will fiercely defend their working and living standards as they prepare for a round of collective bargaining with COSCO later this year.

“Our members are tired from fighting against privatization. It’s hard to convince all of our members to keep fighting through all of their working life—it feels like there’s no way out. But it’s our duty and obligation to fight for the rights we already have. That’s not just for us, but also for future generations. We all deserve to be able to retire from this job healthy and safe,” said Gogos.

But several dockworkers shied away from such optimism, and said what’s happening at Piraeus is just the beginning of a regime of precarious employment that is spreading across Europe. Kleonakos told me, “We know that we in Greece are part of a particularly harsh neoliberal experiment, but it is just the beginning. Today in Greece, tomorrow in Europe. The whole labor system is tending to more flexible systems of work. It is an illusion for the rest of Europe to think they can escape from this fate.”

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