What are the main challenges currently facing the Cyprus Shipping Industry?
Undoubtedly the main challenge we are currently facing is the crew changes issue, which although Cyprus has allowed at an early stage thus supporting our Industry, in many countries travel and port restrictions are still ongoing, leaving thousands of seafarers stranded on board or unable to join ships. Our seafarers and the shipowners have gone the extra mile by applying all health protocols and extending contracts and duration on board putting safety at first. However, the matter now stands to government bureaucracy, although various global industry associations have suggested a framework of health protocols for crew changes, placing both seafarers and the shipowners at a great distress.
In addition to the operational issues which are a causing a major disruption, the Cyprus Shipping Industry is being challenged with the serious economic impact of the pandemic, after witnessing a drop in demand globally, with reduced manufacturing activity, which has slowed down the Shipping sector’s volume of work and activities.
As stated above, the pandemic has brought a series of financial and operational challenges to the Shipping Industry. What is the way forward in order for Cyprus Shipping to maintain its leading role internationally?
Similar to most sectors in Cyprus, Shipping is trying to recover from the economic impact caused by the coronavirus pandemic and continue contributing to the Cyprus economy (7% GDP). Besides the economic measures taken by the Cyprus government to address the impact of the COVID-19 pandemic, Cyprus Shipping requires concrete financial support measures within the framework of the EU Recovery Package to be put in place, taking into account the complexity of our Industry. Long-term measures by the EU can also support the Industry’s efforts to achieve decarbonisation, following the ambitious targets of the International Maritime Organisation (IMO). The Cyprus Shipping Industry is determined to address the environmental impacts of shipping so that we can continue to drive global trade sustainably.
Do you identify any new trends that have emerged from the pandemic?
The coronavirus pandemic is calling for the Shipping Industry to adapt to new realities in order to secure public health and safety, whilst continuing its important role in transferring world trade. In this respect, social distancing and health protocols have made digitalisation and the use of new technologies to automate operations extremely necessary, placing these fields high on the agendas of shipping companies.
As already known, the industry is having an enormous challenge to reduce its greenhouse gas emissions by at least 50% by 2050 compared to 2008. The EU may allocate funds from the recovery plan for the development of alternative fuels and technologies which will contribute in achieving this goal. This can be the driving force for the recovery from the pandemic since it will create new jobs and redirect European economies towards a “greener” future and growth.
Further to the recent appointment of the new Shipping Deputy Minister, what are the Industry’s expectations?
The Shipping Chamber aims to establish an even closer cooperation and communication with the Shipping Ministry by continuing to provide support and expert advice on the Ministry’s related matters affecting the Cyprus Shipping Industry.
The Shipping Industry anticipates that the longstanding administrative issues of the Shipping Ministry, with regard to its structure, as well as the further upgrade of the services will be resolved the soonest, so that the Cyprus Maritime Administration maintains its leadership in a highly competitive international environment.
In view of the coronavirus pandemic, the Shipping Chamber also sees the need for the Shipping Ministry’s digitalisation and automation process to move in a much faster pace as it has become more crucial than ever to the efficiency and safety of shipping operations. We are certain that the Minister will continue and enhance further the important work that has been done since the establishment of the Shipping Ministry in March 2018, which will further upgrade the image of Cyprus as one of the most important and fully structured Shipping Centres worldwide.
What are the main shipping issues Cyprus is lobbying at an EU level and especially through your influence as the Vice-President of the European Shipowners’ Community Associations (ECSA)?
The Chamber actively represents Cyprus at the Board of the European Community Shipowners’ Associations (ECSA) since 2004, but also in its various Committees, contributing significantly to the policy-making of the European Shipping Community. The main issue Cyprus is currently lobbying is the need for Cyprus Shipping to receive financial assistance from the EU Recovery Plan in order to overcome the economic challenges, it is facing from the pandemic.
Furthermore, the Chamber is actively involved and lobbying on various new or revised regulations proposed by the EU based on the EU Commission “Green Deal”. Among the issues we are currently lobbying is the proper implementation of the relevant recent EU decision to include Shipping in the EU Emissions Trading Scheme (ETS), which could have many legal, technical, practical and political implications for the EU and its Member States as well as jeopardize the competitiveness and efficiency of European Shipping. In this connection, we are closely working with ECSA to examine how the EU ETS could implicate the progress at IMO with respect to implementing measures for further reduction of the total greenhouse gas (GHG) emissions. The Chamber is also actively involved in the ongoing discussions for the revision of EU MRV Regulation aiming for a more practical revision to avoid jeopardizing efforts of global actions taken by the IMO to reduce GHG emissions, remove administrative burden from EU shipping companies and avoid the publication of commercial sensitive data. On the other hand, following the outbreak of COVID-19 pandemic and as a consequence to the worldwide lock-down and travel restrictions many owners encounter difficulties to meet EU Ship Recycling Regulation (SRR) deadline of 31 December 2020. The Chamber has initiated a discussion at EU level for a possible grace period of 12 months on the enforcement of the regulation providing owners sufficient time to complete certification of their ships that has been delay due to COVID-19 restrictions and interruptions.
In general, it is the Chamber’s view that EU should take a leading and constructive role at the IMO to ensure that the reduction targets agreed at an international level are met.
In addition to the EU related matters, the Chamber is actively lobbying on an ongoing international issue such as the rising piracy attacks at the Gulf of Guinea. This is a matter of great concern for the industry. Attacks on seafarers have risen in the first half of 2020, with 77 seafarers taken hostage or kidnapped for ransom since January 2020. We have called for appropriate initiatives at the European Union to draw on all available resources to address the problem. Every effort must be exercised to eliminate this unacceptable behaviour and protect our crews.
Can you refer to the future plans of the Cyprus Shipping Chamber?
The Chamber is committed to continuing its important work, ensuring that the Shipping Industry remains sustainable and competitive, for the benefit of its Member-companies and the Cyprus economy. In this respect, in an effort to further strengthen our voice when representing the Cyprus Shipping Industry in Cyprus and internationally on important policy matters, the Cyprus Shipping Chamber together with the Cyprus Union of Shipowners (CUS) have taken the decision end of last year to create a new unified association, with the Board of Directors of both Associations approving a Merger Agreement Outline. The Shipping Chamber continues its efforts towards that goal, and we remain confident – with the recent pandemic “lessons” reconfirming our belief, that “together we can do better” and move forward to a prosperous and sustainable future.