In spite of the recent financial and economic fallout, BMI’s Infrastructure Team maintains the view that Greece’s infrastructure sector is one of the most attractive in Europe. The combination of opportunities for large greenfield (i.e. new projects and developments) and brownfield (i.e. existing assets) deals, coupled with a positive track record on public private partnerships (PPPs), supports the house view.

First on the list is the divestment of stakes in state-owned infrastructure assets. Parts of state owned railway group, OSE are expected to be on the list, as well as non-controlling stakes in utilities such as: EYDAP, owner and operator of water and wastewater systems in Athens; EYATH, owner and operator of water and wastewater systems in Thessaloniki; and, DEPA, the owner and operator or natural gas infrastructure in Greece. In total, the government is hoping to raise close to EUR1.5bn from this venture.

Staunch opposition from workers’ unions, backed by groups like PAME – the nucleus of the communist party KKE – is the greatest challenge the government will face in trying to divest stakes in state-owned infrastructure. However, timing is everything and BMI’s Infrastructure Team believes that Greece’s government now has a crucial window of opportunity to press ahead with the privatisation (or unbundling) of part-owned or state-owned assets, as the urgency to ‘trim the fat’ of the public balance sheet gives the government a strong mandate to do so.

Secondly, the dire condition of Greek public finances has prompted the government to seek investments that can jump-start growth and therefore there is upside potential for the PPP and concession sector. The newly established Infrastructure Ministry is preparing to launch tenders for airports, motorways, metros and trams within the year. The EUR1bn concession for the construction, operation and maintenance of the airport of Casteli in Crete is going to be the flagship PPP venture and a litmus test of the attractiveness of the market and BMI’s view.