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Privatizations in Greece is back on track

Greece’s all-important privatization program has returned to the forefront in what the center-right government’s hopes will be a dynamic post-pandemic recovery in the country over the coming years.

Privatizations were specified in great detail in three successive bailouts by institutional creditors over the past decade, with the obligations still in force in the post-memoranda era, but with a primary difference being that the Mitsotakis government after July 2019 has vociferously favored greater private sector investment over state management in several “non-crucial” but potentially lucrative sectors – just as marinas, ports and real estate.

However, the Covid-19 pandemic mostly quashed whatever progress in achieving several crucial privatizations.

Revenues from the privatization program for 2020 were forecast to reach 2.44 billion euros, with only 54.48 million euros actually collected, a wholly negative development attributed to the pandemic.

Among others, the country’s privatization agency (HRADF) is still waiting to sell-off 30 percent of the Athens International Airport’s holding company. The 30-stake in the holding company that owns Greece’s biggest and busiest airport was expected to fetch upwards of 1.5 billion euros for state coffers.

Progress towards finally starting construction at the Helleniko property development in coastal southeast Athens appears more advanced, with July 2021 now figuring as probable for the transfer of rights from HRADF – officially known as the Hellenic Republic Asset Development Fund – to the Helleniko SA company, the Lamda

Development subsidiary that will develop the property. Another vote will be necessary in Greece’s Parliament before “money changes hands” in this case.

Also on the privatization “horizon” are several state-owned and managed ports and marinas, with the most mature tender process involving the port authorities of Alexandroupolis, Igoumenitsa and Kavala, along with an invitation for and expression of interest for the port of Irakleio (Heraklion).

A similar call for an expression of interest for the port of Volos is expected.

Long-term concessions for a bevy of marinas around the mainland and islands are also in the works, decades after the Greek state first expressed an interest in privatizing such facilities.

Conversely, a handful of major privatizations are still being held up by legal challenges, such as the tender for the concession of the Egnatia tollway running across the breadth of northern Greece (following a motion for an injunction filed by construction contractor Aktor), as well as another legal battle between DE.PA commercial (a natural gas provider) with the industrial concern Greek Fertilizers and Chemicals (ELFE) SA.

On the real estate front, the transaction to sell-off the Afantou land tract on the holiday island of Rhodes is expected in late September 2021, which would conclude another privatization that was first announced decades ago. Next up is an international tender for the Olympic Equestrian Center at Markopoulo, east of Athens proper, which hosts the country’s only pari-mutuel horse track.