For more than 2,300 years, the Port of Thessaloniki in northern Greece has been connecting different peoples and cultures through trade and transit. From the years of the Macedonian ruler Alexander the Great, through the Roman, Byzantine and Ottoman Empires, to the present day, the port has remained one of the most important naval centres in Southeastern Europe — with few periods when it was not in use. Today, the port expands its mission of interconnectedness — with a privatisation that has brought together foreign investors and employees along with a rejuvenation plan that aims to create the greatest transit hub in the Aegean Sea.
“I really believe in this port,” enthused Executive Chairman and CEO of the Thessaloniki Port Authority, Sotiris Theofanis. “That’s why I’m here.” Theofanis recently returned to the head of the port after 16 years — he was previously CEO from 1999-2002. Coming back is “something that emotionally has [had] an effect on me on a personal basis,” Theofanis commented, “but on the other side it has a business effect,” he confided with a smile, explaining that he knows the business well — in fact, he was CEO of the Piraeus Port between 2002 and 2004, currently Greece’s largest port — and is ready to manage the port with new and international shareholders, together with a diverse management team.
“My deputy is a Portuguese guy coming from Terminal Link, our technical partner of the consortium, and the Chief Operating Officer and director of the terminal is a French person,” said Theofanis.
The consortium that purchased a 67 percent stake in the port in March is led by a German company, Deutsche Invest, and also consists of France’s Terminal Link SAS and Cyprus-based Belterra Investments. The companies have agreed to spend 650 million euros on upgrading the port’s facilities over the 34-year concession. The facilities have not had a major upgrade since the 1990s.
The near-term business plan foresees 180 million euros invested over seven years — but Theofanis thinks that time period can be cut back to four-and-a-half years — to develop a number of projects. Notably, this includes the extension of the container terminal by 440 meters and dredging works that will increase the port’s depth to 16.5 meters, explained Theofanis, which is strategic as it will provide a berthing place to accommodate so-called New Panamax vessels. “The important thing behind that is that we will be in a position to serve mainliner services” said Theofanis, referring to services coming into the Port all the way from East Asia. An additional 28 million euros will be invested in replacing obsolete equipment.
The port also plans to develop a freight centre — to be tendered by Greek state-owned railway property management and development company GAIAOSE — and its cruise tourism sector.
“[The] Privatisation of the airport of Thessaloniki, through Fraport, along with the privatisation of the Port of Thessaloniki makes a better environment [for cruise tourism],” said Theofanis, adding that the new metro in Thessaloniki will also be “very effective” in building up the city and attracting tourists.
In this sense, the revamping of the Port of Thessaloniki goes far beyond upgrading a port to touch most parts of the city’s infrastructure and economy. These “spin off” activities, as Theofanis calls them, from the port’s development, include processing and logistics and have the potential to turn Thessaloniki — and Greece — into the region’s top transit and logistics hub.
Indeed, the port has traditionally been the main hub for Southeast Europe and the Balkans, especially the landlocked Former Yugoslav Republic Of Macedonia, Bulgaria and Serbia. With the World Bank estimating that the Western Balkans’ GDP will increase by 3.5 percent in 2018, and by a further 3.8 percent in 2020, this places the Port of Thessaloniki in an advantageous position to become a driver of trade within the region. But now, the port has the potential to expand farther — to other European countries and even Asia, being that the port lies along China’s Belt and Road Initiative, Theofanis explained.
Greece’s other major port, the Port of Piraeus in the south, also lies along the Belt and Road path and has a big Chinese presence. China’s COSCO has invested nearly 550 million euros in the development of Piraeus (although France’s Terminal Link, which now partly owns the Thessaloniki Port, is 49 percent owned by China Merchant Ports). But Theofanis is not worried about competition. Actually, he said “the two ports are complementary”.
“First of all, it [Piraeus] serves mainly the greater Athens Metropolitan area through imports,” clarified Theofanis, with a smile “whilst the Port of Thessaloniki has a different structure of its market…it’s a port that serves northern Greece — and particularly the exports of the country through northern Greece. This is the biggest export port in the country. … And at the same time, it is a transit port for the Southeastern Europe and Balkan countries, which gives it a different identity.”
That identity is one that has been a part of the Port of Thessaloniki since the beginning: connector of peoples, cultures and products from around the world. It is an identity that has turned the port from being just a port, to a cultural centre. “The port of Thessaloniki is a port that is fully embedded in terms of location [in] the city…It’s the old French design of having the port along the seaside and it’s quite similar to…the old port of Marseille” explained Theofanis.
Back in 1999, the first time that Theofanis was leading the Port of Thessaloniki, the port gave old restored warehouses to the city’s cultural entities. This “initiative of giving,” according to Theofanis, is embedded in the port and the city, and “became a successful example all over Europe” of how ports can be connected to their local communities — and the world.