Greek shipping and economy 2020

The Strategic and Economic Role of Greek Shipping

Newbuilding orders by Greek interests amounted to 128 vessels (over 1,000 gt) or 15.928 million deadweight tonnes (dwt) out of a global total of 2,425 orders of 166.825 million dwt at the beginning of 2020¹² in diverse ship types (Figures 4 & 5)¹³. Greek shipowners have been investing heavily in new, efficient ships, with the average age of the Greek-owned fleet (9.17 years) being lower than the average age of the world fleet (9.61 years)¹⁴.

In fact, 28.61% of the Greek-owned fleet under EU flags was built after 2013 and according to the global standard of the Energy Efficiency Design Index - EEDI (MARPOL, Annex VI, Reg. 21), which guarantees better energy efficiency¹⁵. The corresponding percentage for the EU- flagged fleet is 21% and 23.2% for the world fleet. Additionally, the average size of Greek-owned vessels at 81,118 dwt is almost double than the average vessel size of the world fleet which is 43,766 dwt¹⁶. Economies of scale improve efficiency and environmental gains, thereby reducing even further the carbon footprint of Greek shipping.

Greece remains on the UN IMO “List of confirmed Standards of Training, Certification and Watchkeeping for Seafarers (STCW) Parties” and on the White Lists of the Paris and the Tokyo Memorandum of Understanding, while it is one of the safest fleets worldwide with 0.96% of the Greek merchant fleet (based on number of ships) and 0.37% of the fleet (based on tonnage) being involved in minor accidents17. The Greek Register numbers 706 vessels (over 1,000 gt) amounting to 39.19 million gt. The Greek-flagged fleet ranks 8th internationally (Figure 6) and 2nd in the EU (in terms of dwt) (Figure 7)¹⁸.

Greek shipping is one of the cornerstones of the global economy and a major facilitator of global trade, while constituting a pillar of the Greek economy. Greek shipowners are primarily involved in bulk / tramp shipping (Figure 8), which is an example of a sector with characteristics of perfect competition. Comprising mostly small and medium- sized, privately-owned / family businesses, Greek shipping is very flexible and adaptable to changing economic environments and trade flows. It mainly carries staples that are essential for the EU and global economies, including agricultural and forest products, oil and oil products, gas, chemical products, iron and other ores, coal and fertilizers. Importantly, the Greek-owned fleet is the world’s largest cross-trading fleet, with more than 98% of its trading capacity carrying cargoes between third countries¹⁹.

Greek shipping is also of strategic importance to the EU, as both its economy and the welfare of its citizens rely on access to affordable energy. Importing 88% of its crude oil needs, 74% of its natural gas needs and 44% of its solid fossil fuels needs²⁰, the EU heavily relies on maritime transport. With energy security concerns on the rise, Greek shipping plays a crucial role in securing the EU’s diverse energy imports from remote regions of the world. Its strategic importance is also evidenced by the fact that the EU relies on international shipping for approximately 76% of its external trade²¹.

Greek shipping remains one of the pillars of the Greek economy. The receipts in the country’s Services Balance of Payments from maritime transport amounted to approximately €17,303 million for the fiscal year of 2019, which represents a 4.05% year-on-year growth (Figure 9)²².

Greek shipping is one of the cornerstones of the world economy and an important factor in conducting world trade, while at the same time it is a pillar of the Greek economy. Greek shipowners are primarily active in bulk / tramp shipping (Figure: 8), which is a model sector with characteristics of perfect competition. Greek shipping, which consists mainly of small and medium-sized private / family businesses, shows flexibility and adaptability to changing economic conditions and trade flows. It mainly carries products that are essential for the EU and other global economies, including agricultural and forestry products, oil and oil derivatives, liquefied gases, chemicals, iron and other ores, coal and fertilizers. It is noteworthy that the Greek-owned fleet is the largest merchant fleet in the world, with a percentage of over 98% of its capacity to be active in cross-trading 19.

However, the industry’s contribution to the Greek economy is far broader than its input to the Services Balance of Payments. Greek shipping is at the heart of a thriving maritime cluster that generates investments and employment opportunities in the country. A recent study concludes that the total contribution of the Greek shipping industry in the country, including indirect and induced effects, exceeded € 11 billion in 2019 accounting for 6.6% of the Gross Domestic Product (GDP) ²³. Its total contribution in terms of jobs created or sustained in Greece, including indirect and induced employment, surpasses 3% of total Greek employment. Greek shipping, by its size and characteristics, also sets Greece apart as lynchpin of the multilateral trading system, despite the country’s relatively modest size. It is an essential and strategic partner of major trading nations: approximately 22% and 20% of the fleet’s activity serves the U.S. and European trade respectively, while the largest share, approximately 32%, serves the fast-growing Asian economies²⁴.

In addition to all the above, Greek shipowners have been very actively engaging in social welfare initiatives while the Union of Greek Shipowners (UGS) is the only industry group in Greece that has developed its own social welfare company, i.e. SYN-ENOSIS.

Greek shipping is one of the cornerstones of the global economy and a major facilitator of international trade, while constituting a major pillar of the Greek economy. The Greek-owned fleet is one of the safest, most energy efficient and environmentally-friendly fleets.