Free Trade Agreement Between China and Greece

China and Greece have built a strong and growing trade relationship in recent years, reflecting their mutual interests and shared aspirations for economic growth. As of recent trade data, China has become one of Greece’s largest trading partners, with bilateral trade volumes growing exponentially over the last decade. In 2023, the trade between the two nations was valued at over €11 billion, with China exporting electronics, machinery, and textiles, while Greece primarily exports agricultural products, pharmaceuticals, and machinery. For China, Greece acts as a strategic gateway to Europe through the Mediterranean, while Greece sees China as an essential partner in expanding its export markets. China’s investments in Greek infrastructure, especially in the Port of Piraeus, have further deepened the ties between the two nations.

Although there is no formal Free Trade Agreement (FTA) between China and Greece as of 2024, their trade relations are bolstered by numerous other economic cooperation agreements and frameworks, some of which involve other countries or multilateral bodies. These agreements have facilitated the removal of various trade barriers, promoted foreign direct investment (FDI), and increased collaboration in sectors like infrastructure, tourism, and energy.

Bilateral Economic Cooperation Agreements Between China and Greece

1. Comprehensive Strategic Partnership (Signed 2006)

The Comprehensive Strategic Partnership between China and Greece, signed in 2006, marked a turning point in their economic relations. While not a free trade agreement per se, this framework significantly broadened the scope of their collaboration across a range of sectors.

Signed Date: June 2006

Effective Date: July 2006

Scope

The partnership was aimed at promoting cooperation in areas like trade, investment, tourism, and culture. Its most significant component was its focus on boosting bilateral trade and investment, particularly through infrastructure projects and maritime cooperation.

Key Provisions

• Trade Expansion: Both parties agreed to strengthen trade relations by facilitating easier access to each other’s markets, with a focus on eliminating non-tariff barriers.
• Investment Facilitation: Encouraged reciprocal investments, notably in the sectors of energy, telecommunications, and logistics.
• Infrastructure Development: A commitment to enhance maritime collaboration, particularly the development of ports, shipping routes, and logistics hubs. The centerpiece of this was China’s investment in the Port of Piraeus, which became a hub for Chinese goods entering Europe.
• Cultural and Tourism Exchange: The agreement also promoted cultural exchange and collaboration in tourism, with both sides encouraging travel between their countries.

Other Members

This is a bilateral agreement between China and Greece only.

2. Belt and Road Initiative (Signed 2013)

Greece officially joined China’s Belt and Road Initiative (BRI) in 2013, an ambitious global infrastructure and economic development strategy spearheaded by China. Greece’s participation has elevated its role as a critical hub in the broader Eurasian supply chain network.

Signed Date: September 2013

Effective Date: October 2013

Scope

The Belt and Road Initiative focuses on enhancing connectivity through infrastructure investments. Greece’s strategic location in the Mediterranean makes it a natural participant, primarily through projects that aim to improve transport logistics and maritime routes.

Key Provisions

• Infrastructure Investment: The BRI has led to significant Chinese investment in Greek infrastructure, particularly through the China Ocean Shipping Company’s (COSCO) acquisition of a majority stake in the Port of Piraeus.
• Maritime Trade: Greece’s strategic location was leveraged to enhance maritime trade routes between Asia and Europe, with Piraeus becoming a vital transshipment hub for Chinese exports into Europe.
• Energy Cooperation: The initiative also seeks to boost energy collaboration, including renewable energy projects such as wind and solar, and potentially linking Greece with China’s growing green energy technologies.

Other Members

The Belt and Road Initiative is a multilateral agreement involving over 140 countries. However, Greece plays a pivotal role in the European section of this initiative due to its port infrastructure.

3. Memorandum of Understanding on Economic Cooperation (Signed 2019)

In 2019, China and Greece signed a Memorandum of Understanding (MoU) to further strengthen their economic cooperation. While not legally binding like a free trade agreement, the MoU reinforced their commitment to economic collaboration, particularly in sectors like shipping, finance, and energy.

Signed Date: November 2019

Effective Date: December 2019

Scope

The MoU aimed to strengthen Greece’s integration into China’s Belt and Road Initiative while also enhancing bilateral cooperation in areas such as energy, technology, and trade finance.

Key Provisions

• Energy Collaboration: Greece and China agreed to pursue joint ventures in renewable energy, such as solar and wind power, as part of Greece’s effort to transition to greener energy sources.
• Financial Cooperation: The agreement outlined cooperation in banking and finance, including easier access for Greek firms to the Chinese market and vice versa.
• Shipping and Maritime Investment: As one of the world’s largest shipping nations, Greece’s role in the maritime industry was highlighted, with provisions encouraging joint investments in port development and shipbuilding.

Other Members

The MoU is a bilateral agreement between China and Greece.

4. Strategic Cooperation Agreement on Shipping (Signed 2016)

Given Greece’s long-standing position as a leader in the global shipping industry, China and Greece signed a strategic agreement focusing on shipping and maritime cooperation in 2016. This agreement solidified China’s interest in Greece as a maritime partner and further deepened Greece’s role in China’s Belt and Road Initiative.

Signed Date: July 2016

Effective Date: August 2016

Scope

This agreement focuses on shipping, port infrastructure, and logistics. It highlights Greece’s potential as a major European entry point for Chinese goods and aims to improve shipping routes between Asia and Europe.

Key Provisions

• Port Development: Further investment in the expansion of the Port of Piraeus to increase its capacity and efficiency.
• Shipping Collaboration: Encouraging Greek shipping companies to increase their presence in Chinese markets, and vice versa.
• Logistics Networks: The agreement facilitates smoother logistics and transport networks, making it easier for goods to move between the two regions.

Other Members

This agreement is bilateral and specific to China and Greece, although it indirectly ties into broader international shipping networks.

Other Forms of Economic Cooperation

1. China-Greece Investment Forum (Initiated 2017)

The China-Greece Investment Forum, initiated in 2017, serves as a platform for businesses from both countries to explore investment opportunities. The forum focuses on sectors like shipping, energy, real estate, and technology, and is held annually, alternating between the two countries.

Scope

The forum encourages dialogue between Chinese and Greek investors, creating opportunities for direct investments in sectors like shipping, tourism, energy, and infrastructure.

Key Provisions

• Facilitating Direct Investment: Both governments have committed to reducing bureaucratic obstacles for businesses and encouraging FDI.
• Real Estate and Tourism: Greek real estate is seen as an attractive investment for Chinese investors, with several projects, particularly in tourism, receiving significant Chinese backing.

2. Energy Cooperation Agreements

Greece and China have signed various agreements focusing on renewable energy cooperation, particularly in solar and wind power. These agreements are part of Greece’s broader energy transition goals, aiming to reduce its reliance on fossil fuels.

Scope

The focus is on joint investment in renewable energy technologies, knowledge exchange, and the promotion of Greek renewable energy exports to China.

Key Provisions

• Joint Ventures: Encouragement of partnerships between Greek and Chinese firms in energy projects.
• Technology Transfer: Greece benefits from Chinese expertise in solar panel manufacturing and wind energy technologies.

Economic Impact of These Agreements

1. Growth in Bilateral Trade

China-Greece trade has grown significantly over the last decade, largely as a result of their numerous economic cooperation agreements. The value of trade between the two nations has more than doubled since 2013. China’s demand for Greek products, especially agricultural and pharmaceutical goods, has grown, while Greece has become a crucial link in China’s supply chain to Europe, especially via the Port of Piraeus.

• Export Growth: Greek exports to China have seen steady growth, especially in agricultural products like olive oil, wine, and pharmaceuticals.
• Investment Inflows: Chinese investment in Greece, especially in shipping and logistics, has led to significant infrastructure upgrades, boosting the overall Greek economy.

2. Infrastructure and Shipping Industry

The most visible impact of Sino-Greek cooperation is in the shipping industry. The investment in the Port of Piraeus has made it one of the largest and most efficient ports in Europe. This has boosted Greece’s profile as a logistics hub for European trade, with goods from China flowing efficiently into the European market.

• Job Creation: Investments in the port have led to the creation of thousands of jobs, both directly in port operations and indirectly through related sectors like logistics and transport.
• Increase in Shipping Traffic: The volume of goods moving through the Port of Piraeus has increased significantly, making it one of the top three busiest ports in Europe.

3. Renewable Energy Sector

China’s expertise in renewable energy has benefitted Greece as it seeks to expand its renewable energy capacity. Joint ventures in wind and solar power projects have not only improved Greece’s energy output but have also attracted further foreign investment in its growing green energy sector.

• Green Energy Jobs: The expansion of renewable energy projects has also created jobs in construction, engineering, and energy production.

4. Boost to Tourism

Chinese tourism to Greece has grown, aided by the two nations’ cultural exchange initiatives. Greece’s promotion of its islands and historical sites in the Chinese market has led to a significant uptick in Chinese tourist arrivals, contributing to the overall growth of Greece’s tourism industry.

5. Real Estate Investment

Chinese investment in Greek real estate, especially through Greece’s Golden Visa program, has increased. Chinese buyers account for a significant portion of the foreign demand for Greek properties, which has driven growth in Greece’s real estate market.

• Golden Visa Program: The program allows non-EU nationals to gain residency by investing in Greek real estate. This has been particularly attractive to Chinese investors.