Cyprus Shipping is considered a solid and self-sustained pillar of the Cyprus Economy, operating and competing globally with great success. It requires no state investments, yet the Cyprus Government recognizes its contribution which is reflected by its continuous support of the Industry, enabling it to continue its successful course.
In the face of the recent global geopolitical turbulence, the Shipping sector is in front of increased uncertainty at a global level. Cyprus Shipping is inevitably affected by troubled waters on the global scene. At the same time, Shipping is nowadays at a critical point, one of change and potential, as the global transition to a cleaner and greener maritime sector is underway. This ambitious course that the Industry is determined to follow to address climate change requires collaboration across the public and private sectors; while synergies of our Industry and academia should accelerate the required efficient, safe, and technologically proven solutions along with zero-emission fuels that the industry needs to move faster toward the net zero by 2050.
With Shipping being on the pathway to Green Transition, it has shifted the interest of the sector to large-scale “sustainable investments” for low-carbon projects. The element of risk in investment decisions is high as the industry does not have a clear picture yet of future needs and regulatory framework. The risk that the Shipowners are facing, relates to the propulsion technology and the respective fuel availability and the fear of stranded assets if the Industry will follow a different path. It is evident that huge amounts of funds are available to research and innovation, for the development of the necessary technologies and green fuels, but none yet to incentivize the owners who are willing to pursue the path of ordering ships that are driven by zero or near zero alternative fuels. It is though politically correct that the regulations should always be technology neutral, yet the uncertainty and the lack of guidance delay the decision-makers to implement their strategies
Remarkably in the “Decarbonization Pathway”, Cyprus and its Shipping Industry in general play an important role. Several research programs from universities and research institutes, but also from the private sector are focused on new innovative technologies, out of which some successful ones found their way to commercialization.
It will be though an omission if we don’t keep mentioning what distorts the freedom to provide services, such as the freedom of navigation, freedom of transit, freedom of access to ports and harbours, as well as equality of treatment. While the co-coordinated actions by both the Cyprus Government and the Shipping Industry, are continuing, towards the lifting of the illegal restrictive measures by Turkey to Cyprus Shipping, the Turkish Embargo, continues to distort the application of the principle of fair and free competition in Shipping trade with the EU and adversely affecting the merchant fleets of EU Member States, undermining the economic development and operations of Cyprus and EU Shipping as a result. Every effort, therefore, must be made by the EU to resolve this illegal action, using the recently renewed interest of Turkey to “warm up” its commercial/political relations with the EU through perhaps a mutually beneficial trade agreement on the EU/Turkey customs union.
Cyprus Shipping has long established a strong influence in regional and international fora through the public sector’s active involvement at the International Maritime Organization, advocating for Cyprus Shipping policy positions and through the Cyprus Shipping Chamber’s membership at various regional and international Shipping associations and organizations, such as the International Chamber of Shipping (ICS) and Cyprus presidency at the European Community Shipowners’ Associations (ECSA), establishing partnerships and shaping together with other shipowners’ associations a regulatory framework for Shipping aligned with the interests of the industry, always in close consultation with the Cyprus Maritime Administration.
The time has come to capitalize on and boost Cyprus’ leading position, taking further actions on a national level, to safeguard the essential services offered by the Shipping Industry, which is contributing to and supporting the progress of our country and economy (at 7% of the Gross Domestic Product) and are more necessary and worth preserving in times of turbulence. Having in mind Cyprus’ prominent position in International and European Shipping and the tangible prospects of further development with direct benefit to our country’s Economy, the job market, and the attraction of healthy foreign investment, it is beneficial not only to continue but also to strengthen it with several improvement measures proposed by the Industry as mentioned below.
The necessity to establish new structures, such as the specialized “One-Stop-Shipping-Centre” at the Shipping Deputy Ministry, will significantly upgrade the services provided to the Cyprus Shipping Industry, to the extent that they satisfy the constantly changing operational needs of the 11th worldwide and 3rd largest merchant fleet in the European Union.
The competition is relentless and the Cyprus Shipping Industry needs to upgrade its systems and offer a “Fast-Track” all-inclusive 24-hour service to immediately process the needs of “the industry that never sleeps” and demands direct and fast access/priority to all relevant State Authorities/Ministries as well as the opportunity to deal with all issues in a prompt and efficient manner.
These new services go hand in hand with completing the digitization/automation of the Shipping Deputy Ministry’s services offered to Shipping companies. The transformation to a purely digital environment, shaping the “one-stop-service” support framework, will create advanced dynamics for the Cyprus Shipping Registry and its users.
Our Industry also looks forward to the launch of the decision of the House of Representatives to form a Cyprus Shipping Company with Limited Liability, which will improve further the competitiveness of the Cyprus Flag internationally, as well as simplify the procedures and the operating regime of the Cyprus Shipping companies that are owners of Cyprus ships.
With regard now to the Industry’s “Green” Transformation efforts and not only, it is proposed to examine the possibility of establishing a Government endorsed Specialized Financing Institution for the Shipping/Transport Sector, which will focus exclusively on providing competitive finance for the purchase of ships or other modes of transport. Such an institution may have access to capital from regional public and private financing institutions engaged in “object” financing, thus accelerating the industry’s decarbonization path. The existing ship financing provisions by Cyprus Commercial Banks cannot accommodate the ever-increasing capital requirements for the Shipowning companies. This Financing Institution will enable the local shipowning sector to grow faster and greener, supporting both the Cyprus Flag and the local Shipping Industry.
The above measures that have been already taken and those underway have been positively received by the Industry and the feedback is encouraging. Cyprus has set a new course, continuing its leading role, bringing added value to the European as well as to the International Shipping community.
