Since establishing diplomatic relations in 1972, China and Greece have deepened their partnership in terms of trade, investment, and cultural exchanges. Greece has emerged as an important European gateway for Chinese investment, particularly through its key role in China’s Belt and Road Initiative (BRI). China’s investment in the port of Piraeus, led by COSCO, has transformed the port into a major transport hub in the Mediterranean. Container capacity has increased from 1.5 million TEU to 6.2 million TEU, and this investment has brought significant economic benefits to Greece, including job creation and increased income. Greece’s exports to China in 2023 were led by sectors such as salt, sulfur and machinery, although China remains Greece’s largest trading partner. The two countries continue to explore opportunities for cooperation in energy, shipping and renewable technologies.
Since establishing diplomatic relations in 1972, China and Greece have fostered a dynamic and multifaceted partnership, especially in the areas of trade, investment and cultural exchanges. Over the past two decades, this relationship has deepened significantly, with Greece playing a pivotal role in China’s Belt and Road Initiative (BRI) and emerging as a key European gateway for Chinese investment, particularly in infrastructure and shipping. China’s investment in the Greek port of Piraeus is one of Europe’s largest port investments and represents the growing economic interdependence between the two countries.
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Economically, China is one of Greece’s most important trading partners, and the two countries have benefited from a strategic partnership in areas such as energy, communications and shipping. Chinese state-owned enterprises, including COSCO, have led innovative projects.
Meanwhile, Greek shipping companies play an important role in China’s maritime trade, transporting a significant portion of its energy imports. Meanwhile, Greece has used these relationships to attract foreign direct investment (FDI) and recover from the economic downturn experienced during the 2008 financial crisis.
This article delves into the evolving economic relationship between China and Greece, analyzing major investments, strategic cooperation, and the broader political implications of the growing relationship between the two countries within the Belt and Road framework.
Opportunities for Greek companies in China
Greek companies have promising opportunities in China, especially in areas that respond to China’s growing consumer demands and industrial transformation. China’s expanding middle class has created an important market for Greek products, particularly in the food and beverage industry, with Greek olive oil, wine, and dairy products such as feta cheese becoming increasingly popular. Tourism is another key area, as the increase in Chinese outbound tourists provides opportunities for Greek travel companies to attract Chinese tourists to Greece and provide travel services in China.
Moreover, shipping and logistics offer opportunities for Greek companies, given Greece’s strong maritime industry and China’s need for efficient transport solutions, especially within the framework of the Belt and Road Initiative. Furthermore, the renewable energy sector is a growth area, and as China seeks global partnerships in green technology, Greek companies could offer expertise in solar and wind energy.
Finally, technology and innovation partnerships, especially in areas such as clean technology, smart cities and agritech, will further strengthen cooperation between Greek companies and Chinese industry, leveraging China’s focus on modernization and sustainability. There is a possibility.
Bilateral trade between China and Greece
Overall, trade between China and Greece will expand, with China remaining Greece’s third largest trading partner. However, Greek exports to China still represent only a small portion of the country’s total imports, revealing great potential to expand the presence of Greek products in the Chinese market.
According to the UN COMTRADE database, Greece’s main exports to China in 2023 were salt, sulfur, earth, stone and cement worth US$113.2 million, followed by ore, slag and ash worth US$70.76 million. Machinery and nuclear reactors accounted for US$41.19 million, and pharmaceuticals accounted for US$40.5 million. Additionally, mineral fuels and oil accounted for US$30.33 million, reflecting Greece’s main export sector to China.
Main exports from Greece to China (2023) Product category Amount (US$) Millions of dollars Salt, sulfur, earth, stone, gypsum, lime, cement 113.20 Ore slag and ash 70.76 Machinery, reactors, boilers 41.19 Pharmaceuticals 40.50 Mineral fuels, oils and distilled products 30.33 Source: COMTRADE, 2024
In terms of imports, in 2023, electrical and electronic equipment accounted for the largest amount of imports from China at US$1.79 billion, followed by machinery and nuclear reactors at US$1.63 billion. Furniture, illuminated signage and prefabricated buildings accounted for US$350 million, and paper and paperboard products accounted for US$340 million. Additionally, toys, games and sports essentials accounted for US$310 million, reflecting Greece’s diverse import portfolio from China.
Main imported products from China to Greece, 2023 Product category Amount (US$) Millions of dollars Electrical and electronic equipment 1.79 Machinery, nuclear reactors, boilers 1.63 Furniture, lighting signs, prefabricated buildings 0.35 Paper and board, pulp products, paper and paperboard 0.34 Toys, games and sports requirements 0.31 Source: COMTRADE, 2024
Focus on Chinese investment in Greece: Port of Piraeus
China’s investments in Greece, particularly through COSCO Shipping’s involvement in the port of Piraeus, have transformed the once struggling port into a major transport hub connecting Asia, Europe and Africa.
Since COSCO acquired a stake in the port in 2010, Piraeus’ container capacity has increased from 1.5 million TEU to 6.2 million TEU, ranking it among the top 40 largest ports in the world. This investment not only revitalized Piraeus, but also attracted multinational companies such as ZTE and Hewlett-Packard, further boosting Greece’s logistics and trade sector.
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The financial impact was significant, with the Piraeus Port Authority recording record revenues of €194.6 million in 2022, an increase of 26.2% year-on-year. COSCO’s €600 million investment has created thousands of jobs and supported local education and cultural initiatives. As a flagship project under China’s Belt and Road Initiative, the port has become a symbol of successful cooperation.
trade and investment agreements
China-Greece Bilateral Investment Agreement
In 1992, China and Greece signed a Bilateral Investment Treaty (BIT) to promote and protect mutual investment between the two countries. The agreement aims to strengthen economic cooperation by establishing favorable conditions for investors and ensuring a stable and transparent investment environment.
The main provisions of the China-Greece BIT include:
Investment protection: BITs guarantee protection against expropriation, nationalization, and discriminatory practices and ensure fair treatment of investments. In the case of expropriation, compensation must reflect the fair market value of the investment at the time of expropriation and must be paid promptly in a freely convertible currency. Fair and equal treatment: Both Chinese and Greek investors are guaranteed the same preferential treatment as domestic investors and third-country investors. This provision guarantees non-discriminatory treatment in the establishment, management, maintenance and enjoyment of investments. Dispute Settlement Mechanisms: The Convention provides multiple mechanisms for resolving investment-related disputes, including negotiation, mediation, and international arbitration. Investor-State Dispute Settlement (ISDS) provisions allow investors to bring disputes with international organizations such as the International Center for Settlement of Investment Disputes (ICSID) or under the rules of the United Nations Commission on International Trade Law (UNCITRAL). Masu.
The agreement also facilitates the free transfer of investment-related funds, including earnings, profits and fees, in freely convertible currencies without undue delay.
Double taxation avoidance agreement between China and Greece
The Double Taxation Agreement (DTA) between China and Greece was signed on April 24, 2015 and entered into force on January 1, 2016. The agreement aims to eliminate double taxation on income and capital and promote trade and investment between the two countries. .
The DTA covers the various income and capital taxes imposed by both countries. In China, this involves:
China Individual Income Tax (IIT). China Corporate Income Tax (CIT).
In Greece, this agreement applies to:
Income tax on natural persons in Greece. Greek corporate income tax. and other taxes on income and capital imposed by Greece.
One notable feature of the DTA is the introduction of reduced withholding tax rates on passive income. in particular:
Dividends: Generally a reduced tax rate of 5% applies if the unitholder holds at least 25% of the capital of the paying company. Interest: Generally taxed at a reduced rate of 10%, but certain government-related entities are exempt. Royalties: Typically subject to a reduced tax rate of 10 percent.
The agreement also refers to capital gains taxation, meaning that if a Greek investor holds a significant interest in a Chinese tax resident enterprise (TRE), Greece will tax the profits from the sale of the shares. It stipulates that it is possible.
Additionally, the DTA includes provisions to prevent tax avoidance through measures such as the exchange of information between tax authorities and the definition of a “permanent establishment” (PE), which reduces the tax liability of companies operating in both countries. helps clarify.
Overall, the DTA will strengthen China-Greece economic relations and provide a more stable tax environment for investors and companies engaged in cross-border activities.
multilateral treaty
Both China and Greece are members of the WTO and are signatories to various multilateral treaties on trade and investment. These include:
TRIPS requires WTO members to extend intellectual property rights to owners in member states. It incorporates a Most Favored Nation (MFN) clause, which guarantees equal treatment for intellectual property rights protection in all member states. It also provides dispute resolution and compensation mechanisms. The Agreement on Trade-Related Investment Measures (TRIM) prohibits the implementation of investment measures that restrict trade between member countries. This includes measures such as local content requirements that require companies operating in the market to use locally produced goods and services. GATS provides most-favored-nation status to service providers in WTO member countries, excluding government services such as social security, public health, education, and certain services related to air transport.
