Greece Could Become Global Maritime Capital, Says New Report

The Greek shipping industry is adapting to become a leading global maritime hub says a report by auditors Ernst & Young (E&Y), which outlines the steps that should be taken to achieve this goal.

The Greek-owned fleet, with over than 5,272 vessels and a value approaching 86 billion USD, remains the largest in the world, in terms of tonnage Capacity, says the report.

The inflows from shipping activities account for approximately 6.5% of Greek GDP and also have a substantial indirect multiplier effect on the Greek economy.

E&Y say that the privatization of the port of Piraeus with the involvement of COSCO, as well as the recent privatization of the port of Thessaloniki, raise hopes that the country’s role as a gateway for Southeast Europe may be strengthened in the coming years.

It notes however, that the shipping industry needs to adapt to the changing market that is becoming more integrated and globalized.

Nationals of Greece and Japan continue to own just below 30% of the global fleet. However, more than 40% of vessels are registered in Panama, Liberia and the Marshall Islands. Korea and China account for approximately 70% of shipbuilding, while more than 90% of scrapping takes place in India, Bangladesh, China and Pakistan.

It comes as no surprise, therefore, the report argues, that countries and individual cities are competing to attract shipping companies and emerge as the leading maritime clusters of the world. As companies are becoming more mobile and increasingly prepared to split up their value chains and move activities to the most attractive locations, this competition is intensifying.

In this race to secure a place among the leading maritime clusters of the world, it is increasingly cities, rather than states that are competing, it says.

According to the E&Y report, the winners of the future will be the ones that will be able to attract science and education, owners and headquarters, R&D and leading maritime finance and law services.

In addition to these four largely objective and measurable sets of criteria, the attractiveness of maritime clusters is greatly influenced by their overall business environment, the stability of the regulatory framework, the tax regime and political institutions, the transparency of the legal system and the willingness of local government to support the industry. These are areas on which governments will need increasingly to focus and are likely to determine the winners among today’s leading maritime clusters.

Asked to predict which would be the leading maritime centers within the next ten years, ship-owners, managing directors and top executives of Greek shipping companies, responded that Singapore was by far their port of choice (73%), followed by Piraeus (49%), Shanghai (33%), Dubai, London and Hong Kong.

The full report here