Cyprus aspires to enhance its leading role in world shipping to a higher level in order to be a step ahead of the competition, both as an international registry and as a base for international shipping operations, Transport Minister Erato Kozakou-Marcoullis said on Friday.
“Cyprus’ strategic location and a series of other factors, such as an efficient civil service, an high level of legal and accounting professionals, an excellent and reliable banking system, state of the art telecoms and air links, constitute firm foundations for the influential role that Cyprus enjoys in the shipping industry”, she told the 22nd AGM of the Cyprus Shipping Chamber in Limassol.
Merchant shipping, she said, “is probably one of the most important sectors of our economy that has been instrumental to the achievement of Cyprus’ economic miracle after the Turkish invasion of 1974, to the point that today Cyprus’ merchant fleet ranks tenth globally and third in the European Union.”
The Cyprus Registry has a high reputation worldwide as a “Flag of Progress and Quality”, the minister said.
“This is the consequence of a well planned policy of maintaining a high standard and high quality fleet and simultaneously of effectively and scrupulously implementing the internationally applicable safety, security and environmental protection standards,” she added.
Referring to the new Tonnage Tax system, she said that the response of the shipping industry has been very encouraging so far.
“A significant number of foreign shipping companies, of mainly European interests, contemplate to establish offices in Cyprus, to take advantage of the new system,” she declared.
Kozakou-Marcoullis also referred to Turkey’s restrictive measures against Cyprus shipping, saying that lifting these measures would certainly have a positive economic and political impact.
“This issue adversely affects European interests and our intention is to seek a solution in line with the European acquis,” she said.
PIRACY CONCERNS
In his address, the Secretary General of the International Chamber of Shipping and International Shipping Federation, Peter Hinchliffe, said that piracy is one of the biggest problems faced by the international shipping community today and called on the International Maritime Organisation and governments in general to push for a comprehensive international legal framework to combat piracy.
Hinchliffe said that since 2005 more than 198 ships and 3790 seafarers were hijacked by pirates, of which, he added, 28 ships and 587 seafarers are still being held captive today.
Shipowners, he noted, have an obligation against the safety of their ships and most importantly their seafarers, adding that in the absence of necessary legal procedures and a complete international legal framework they are forced to take alternative measures, such as employing armed guards onboard ships trading in known pirate areas.
SHIPPING 6% OF GDP
In his address, CSC President Capt. Eugen Adami said that the recent approval of the new taxation system ensures the viability of the Cyprus Register and the island’s shipping industry in general.
He added that the new taxation system also ensures the unhindered continuation of the substantial contribution of the shipping industry to the Cyprus economy which as, he said, is according to latest data around 6% of the country’s GDP.
The Turkish embargo and piracy are two of the main problems both Cyprus and international shipping are faced with, he said, calling on the government to intensify efforts to resolve these issues soon, offering at the same time the Chamber’s full co-operation in the attempts to tackle them.
In April 1987 Turkey imposed restrictions on Cyprus-flagged vessels and in May 1997 Ankara issued new orders to extend the restrictions to include ships under a foreign flag which had any relation with the Republic of Cyprus, accounting for 16% all EU-registered ships.
These restrictions disrupt shipping and air traffic, in addition to causing huge financial and other problems. Annual losses for the Cyprus economy because of the restrictions amounted to 138.5 mln euros in 2008, accounting for 1.3 % of GDP, while the losses attributed specifically to the shipping sector amount to 100 mln euros a year.
GLOBAL POWER
The establishment of Cyprus as a global maritime power and a quality registry is now an undisputable fact, President Demetris Christofias said in a written speech read out at the CSC AGM.
In his address, Christofias pointed out that 2010 was marked by a significant success, namely the approval of Cyprus tax framework on shipping, which yields additional competitiveness and attractiveness to the Cypriot maritime.
The president also pointed out that the Cypriot registry would rank even higher among international fleets if Turkey did not impose restrictive measures.
He also expressed satisfaction that the Cypriot shipping industry, following timely and well-planned actions, has mitigated the adverse consequences from the global financial crisis.
“The Cypriot shipping has absorbed the negative results of the crisis and it is on a recovery course,” he added.
Describing the shipping sector as “an important pillar of the Cypriot economy,” Christofias added that the government aims to provide all necessary incentives that are eligible under EU rules in a bid to preserve and improve Cyprus' position in global maritime even further.
