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Cyprus Shipping Industry: Proved once again its resilience in times of crisis

As we welcome the beginning of a new year, we will try to review the main developments that took place during 2021, so that we can outline the “Day After” for Cyprus Shipping.

Upon reviewing the outgoing crucial for Cyprus Shipping year, we confirmed, once again, that the Shipping Industry “is resilient in times of crisis”. It remained as one of the most important “blood donors” of the Cyprus Economy and continued to offer, despite the significant difficulties, its services, which are vital to humanity, at a time when most industries were forced to cease their operations due to the Covid-19 Pandemic restrictions.

In the paragraphs that follow, we try to illustrate the current state of Cyprus Shipping and thereafter to present both the coming challenges and prospects for its sustainability and further development in the year ahead.

Before we refer though, to the prospects and challenges of Shipping, let us point out the main and ongoing characteristics of Cyprus Shipping, which reconfirmed its resilience during the Covid-19 Pandemic.

  1. Continued to have the 11th largest merchant fleet globally and the 3rd largest fleet in the European Union, as well as the largest third-party shipmanagement centre in the European Union, and one of the largest in the world.
  2. The recent renewal of its very competitive and EU approved Shipping Tonnage Taxation System, allowed to maintain the existing shipping companies and even attract more quality shipowning, shipmanagement and shipping related companies in Cyprus.
  3. The Shipping Industry maintained its contribution to the Cyprus Economy at 7% of GDP (approximately €1.2 billion), which is a vital amount, given the economic instability and disruption of the global supply chain.
  4. Cyprus Shipping continues to have an excellent image at a national and international level. It is characterised as a healthy example of attracting sustainable investments, through the establishment of internationally well-known shipping companies in Cyprus, which for decades, maintain their headquarters in the country and offer numerous and well rewarding job opportunities, with a substantial contribution to the Cyprus economy.
  5. Domestic Shipping continues to employ around 9000 highly qualified personnel and 55000 seafarers, with more than 200 Shipowning, Shipamangement and shipping related companies, operating from Cyprus.

The above-mentioned characteristics clearly indicate that Shipping is a robust industry, with a steady contribution to the Economy and is one of the most productive industries generating foreign exchange revenue in Cyprus.

Hence, which are the factors that could ensure the viability and further development of such important, for the Economy, Industry?

  1. Shipping Deputy Ministry – Strategic Vision Implementation and Enhancement of Corporate Environment

The implementation of the new Shipping Ministry Strategy, “SEA CHANGE 2030”, in close collaboration with the Shipping Industry, which embraces the creation of a “One Stop Shipping Shop”, further upgrading thus the image of Cyprus as a modern, quality and sustainable maritime centre, which offers an attractive business environment with enhanced services.

There are also prospects for further promotion of Shipping abroad through an even more enhanced and planned campaign to attract Shipping companies, thus achieving an increase in the number of ships that in the Cyprus Register.

At the same time, it is important to strengthen even more the representation of Cyprus at the International Maritime Organisation (IMO) and European Commission, in order to safeguard the interests of Cyprus Shipping, especially with regard to the effective implementation of the new environmental regulations in the transport sector.

  1. Shipping “Green Transformation”– With Feasible Measures

The green transformation of the maritime sector is a top priority for the Shipping Industry but also a race against time, to find alternative fuels and energy sources.

Shipping, as a purely globalised industry, must be regulated globally by the International Maritime Organisation. European shipowners, however, also have to deal with EU legislation, which introduces regional requirements and creates additional operational problems and competition issues with shipowners outside Europe. It is therefore necessary, to adopt realistic and feasible measures that will be effective and will enable progress in achieving the levels of ambition established in the original strategy of the International Maritime Organisation for zero emissions from ships.

The Cyprus Shipping Chamber as from January 2022, through the election of its representatives, for the first time in the Cyprus Shipping history, as President of the European Community Shipowners’ Associations (ECSA) and Vice President of the International Chamber of Shipping will be at the forefront in the formulation of Shipping policy on a European and international level respectively, on these main issues, thus promoting Cyprus Shipping worldwide.

  1. Turkish Embargo on Cyprus ships – Immediate Lifting

In addition to the various operational difficulties, the Cyprus Shipping Industry is called upon to face international competition on a daily basis, having the great disadvantage of the Turkish Embargo on Cyprus-flagged ships, or ships related in any way with Cyprus. This long-term issue constitutes a serious problem for the further enhancement of the Cyprus flag / Register, the lifting of which and / or the solution of the Cyprus Problem, will bring a massive growth for the Cyprus Maritime Cluster and Cyprus Ports.

  1. Maritime Education and “Blue Growth”

Shipping is a dynamic source of jobs and has the potential to create additional employment opportunities within the framework of “Blue Growth” and “Integrated Maritime Policy” of the EU, with the development of a full range Maritime Training in Cyprus, thus offering properly trained and qualified staff to the shipping companies that operate in our country, and further increasing the attractiveness of Cyprus as a maritime centre.

Final Thoughts:

Marching into the new year, which will be crucial for the future of the economy, it will require vigilance, flexibility and targeted support in resilient sectors, which present comparative advantages and can stimulate the wider economic and social development of our country.

Taking into consideration the above outline of developments, we firmly believe that Shipping is one of these sectors, which not only contributes to the Economy and Society, but also strengthens the political entity of our country internationally.

The “Day After”, should therefore find us unified, under a coordinated national effort, in order to maintain Shipping achievements of recent years and capitalise the opportunities of the new year ahead for the benefit of the Cyprus Economy and Society.

Cyprus Shipping 2022: Despite “storms and pandemics”, once the operational problems are properly addressed, it will continue to Proudly Navigate Cyprus Worldwide.

By Thomas A. Kazakos, Director General, Cyprus Shipping Chamber

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