Greeks’ Role in Shipping Seen Unscathed Regardless of EU Destiny

BY Naomi Christie

(Bloomberg) — Greek shipowners dominant’ function in world commerce faces little risk from the monetary turmoil that’s roiling the Mediterranean nation, in response to analysts who monitor the nation’s maritime business.

The Greek authorities shut banks and imposed capital controls in an in a single day announcement aimed toward stopping the collapse of its monetary system. There’s an 85 % probability Greece will likely be compelled to cease utilizing the euro foreign money, in response to Mohamed El-Erian, chief financial adviser at Allianz SE.

Greeks personal nearly a fifth of the world fleet’s transportation capability, greater than the residents of every other nation, in response to the United Nations. While the Greece’s destiny in Europe might have an effect on foreign money markets and harm financial development, Morgan Stanley anticipates the direct impression on its homeowners will likely be restricted. Most already moved their deposits elsewhere, mentioned Fotis Giannakoulis, a New York-based analyst on the financial institution.

“Operations of international shipping companies are unlikely to be affected,” Giannakoulis mentioned in a report despatched by e-mail Monday. “From our extensive discussions with several management teams during the last few years, we understand that all shipping companies keep their cash deposits in international banks, facing effectively no risk from the capital controls announced.”

Owned Elsewhere

While Greek ships have lengthy dominated the world’s commerce lanes, a smaller proportion are registered within the nation for possession functions.

Greeks beneficially owned 17 % of the worldwide fleet’s transportation capability in the beginning of final 12 months, in response to the latest examine by the United Nations. Japanese homeowners ranked second with 14 %.

By distinction, lower than 5 % of the worldwide fleet measured by capability flies the southern European nation’s flag, with ships usually registered in so-called flag states like Panama, Liberia and the Marshall Islands, the UN’s knowledge present.

“It’s hard to see how the Greek shipowners should be affected or how world trade should be affected,” Nigel Prentis, the London-based head of analysis at Hartland Shipping Ltd. who has greater than three a long time expertise working with Greek shipowners, mentioned by cellphone. “They’re operating offshore assets in tax-free environments.”