ECONOMY

Lack of incentives turns Greek shipowners away from investment

Cutting red tape and providing investment incentives could attract a large part, if not all, of the available capital in the hands of Greek shipowners, which is estimated at $200 billion. Shipping contributes -12.4 billion to the national economy, about 7 percent of gross domestic product (GDP). It also accounts for 37 percent of the current account inflows. Taxes from shipping also account for 5 percent of the budget’s net revenues. Great potential Most of the shipping companies’ money, however, is not invested in Greece. The country is simply not an attractive place to invest, and this holds true of Greek shippers as well as foreign investors. In 2004, for example, there were inflows of -13.3 billion from the shipping sector, but only -4 billion was invested. Officials at the Shipping Chamber said that there is a widespread view among Greek shipowners there are too many bureaucratic obstacles to be surmounted, making investment in Greece a high-risk one. «Aiding the shipping sector to invest in Greece, by offering support services and cutting red tape, will attract significant direct investment and will contribute to economic growth as well as to export growth,» a Shipping Chamber official told Kathimerini. The General Secretariat for Competitiveness had recently proposed three measures that could attract more shipping-sector investment. First, the creation of a shipping center in Piraeus that would, along with the second measure, the deregulation of the market, convince more Greek-owned (but also foreign-owned) shipping firms to move their headquarters to Greece. Third would be creating a cluster of services that would be internationally competitive and operated by highly specialized personnel. The Shipping Chamber itself has made a few proposals, some of them longstanding demands by shipowners. First of all, it proposes scrapping the regulations regarding the composition of ships’ crews, especially officers. It also asks that the state be responsible for funding the crews’ pension fund. A third proposal is the ability to list a long-haul shipping company more easily, without the current restrictive terms. Training upgrade Shipowners also ask for an upgrade of merchant marine officer training, the subsidizing of unprofitable domestic shipping lines and, from the Greek banks, financing on better terms. They demand that all Greek ports be available as terminals for cruise ships, after upgrading terminal infrastructure, including passenger terminals. They also support the privatization of port services, which port employees vehemently oppose.