Greece stands at the crossroads. Unable to pay national debts, the country must soon make a choice on whether to default and thereby endanger the whole eurozone, or find another way to raise the money it doesn’t have. And it’s a lot of money we’re talking about – €50bn.
First let’s think about whether Greece could flog anything that foreign investors might want to buy. It does have a few prized assets – its ports and utility companies would be attractive investments. But both are so heavily unionised that they would only be sellable against considerable political and public resistance. Combined they aren’t likely to raise the whole 50 big ones needed, but they could certainly go a long way toward balancing the books.
Let’s say they were put up for sale tomorrow. The question then is – who has that kind of spare cash lying around these days? And more to the point, who has the kind of backbone required to ignore the public backlash that will inevitably result from such an assault on national sovereignty?
Well, I don’t think it takes too long to think who. That’s right, you’ve guessed it – everybody’s favourite cash rich, PR ambivalent, billion dollar bargain hunter – China.
And why not? China threw $8bn Tanzania’s way for a few million acres of farmland a couple of years ago and no-one batted an eye. They paid $5bn for Congo’s tin mines and it barely made news. And they’ve quietly whipped up a few hundred more billions worth of oil and gas reserves from half a dozen other developing countries struggling, like Greece, under the weight of crippling sovereign debt. So why not Greece next? Because it’s Europe? Give me a break.
Flights from Beijing to Athens are reported to be fully booked these days with Chinese investors and politicians flying over to eye up Greece’s crown jewels. Last month, for the first time, Air China began direct flights to Athens to meet increased demand.
Sitting on $3tn of foreign reserves denominated in increasingly less valuable dollars means China is desperate to invest in income generating assets overseas. Give the eurozone debt crisis another few months and China may well be stepping in to buy more than just the Greek ports. How about some Spanish fishing rights, or an Irish phone company or even the odd Portugese golf course or ten?
The Chinese are going out for ‘a European’ this year and as we already know – they often prefer to ‘take-away’.