ECONOMY

Niarchos shipping saga draws to an end, but with little effect on the Greek fleet

The international shipping scene is losing one of its legendary names: the heirs to Greek tycoon Stavros S. Niarchos said yesterday they are pulling out of shipping because it is too risky following the Prestige tanker sinking. «The complex geopolitical environment in the 21st century led us to the judgment that it is not appropriate for the estate’s heirs… to assume the risk of active involvement in a shipping enterprise,» the heirs said in a statement read to AFP by the foundation’s legal adviser. «The ships are certainly going to be sold now,» the president of Niarchos foundation, Costas Drakopoulos, told AFP. The Prestige, which was run by Greek interests, sank off the northwest coast of Spain on November 19 last year spreading oil pollution along the Atlantic coast and increasing pressures on European authorities to tighten up shipping legislation. Niarchos, alongside his archrival Aristotle Onassis, built up the reputation of the Greeks as the biggest players in international shipping after World War II. Born into a merchant family in 1909, Niarchos entered shipping in the 1920s. By his death in 1996 he had amassed a fortune estimated at more than than $5 billion (4.37 billion euros). He was briefly married to Charlotte Ford of the Ford US auto dynasty. Niarchos himself had begun to limit his shipping interests, investing in property, refining, banking and finance instead. The Niarchos group currently runs five tankers under the Greek flag, the oldest built in 1993, and has another two bulk carriers on order. The decision to pull out of shipping had to be taken even despite the fact that «efforts were made in the last 10 years to assemble a small, efficient and safe fleet,» the Niarchos adviser said. Senior Greek shipping officials regretted the heirs’ decision. They said it reflected the high risks associated with oil transport after «uncontrolled» compensation claims. Another factor was a legislative onslaught at European Union level in the aftermath of tanker disasters and oil spillages involving the ships Erika, Prestige and Tasman Spirit. The president of the Greek Shipowners Union, Nikos Efthymiou, told AFP: «It’s a regrettable fact which unfortunately confirms what we have repeatedly said… the threatened criminalization of shipowners and managers for actions or omissions, as well as many other things, have led to the withdrawal of the most historic name in Greek shipping.» «It’s not a surprise that after what is happening the family decided against risking 95 percent of their assets, should an element just representing 5.0 percent be involved in a pollution,» said shipping analyst David Glass. Greek Merchant Marine Minister George Paschalidis said he hoped that the ships would remain in Greek hands. Despite the personal wealth accumulated by its most prominent members, Greek shipping views itself as a midsized industry, by international corporate standards, which is beleaguered by a range of recent measures against tanker accidents causing heavy pollution in Europe and Asia. «Are we heading toward the creation of conglomerates? The shipping business is not suited for them,» Efthymiou said. «It is equal to an appropriation of assets,» he said commenting on recent European Union legislation, enacted after the sinking of Greek-run tanker Prestige to speed up the phase-out of single-hull tankers. «We had barely agreed on a timetable after the Erika accident and the European Union overturned its own legislation within two years. Many people had made investment decisions in the meantime,» he said. Efthymiou also dispelled notions that the second generation of Greek shipowners was losing the taste for risk that made their fathers big. «The appetite to do business is there,» he said, pointing to the rejuvenation of the Greek-run fleet in recent years. «They deal more with their bankers than with their engineers now,» a Piraeus source said. According to figures from the London-based Greek Shipping Cooperation Committee (GSCC), Greek companies control 9.3 percent of the world’s ships in service and on order, 18.3 percent of deadweight tonnage and 15.9 percent of gross tonnage against 9.2, 17.8 and 15.5 respectively in 2002.