Cypriot Shipping Official Gushes at Future of Industry

The Department of Merchant Shipping is taking on a more prominent role in the Cypriot economy thanks to its public private partnerships, its expanding offerings, and its renowned reputation in the region.

Mr. Efstratiou has been serving as Acting Director for the Department of Merchant Shipping since April of 2016. Prior, he served as Head of the Marine Environment Protection Division. He is also a chairman of the National Committee of Seafarers Training and the Committee of Cyprus.

Since Cyprus established the Department of Merchant Shipping (DMS) in 1977, the island nation’s shipping industry has leapt from the 32nd largest commercial shipping fleet to the 10th largest worldwide. Cyprus is one of Europe’s smallest countries, and yet its shipping market is making a big splash in the region, currently ranked 3rd in the continent. DMS alone pulls in an average of 8 million Euros of revenue, which in turn creates more than one billion Euros worth of the total national economy, or 7% of GDP. The company’s steady growth and increasingly diverse offerings have created an attractive environment for both regional and international shipping companies.

But success doesn’t mean Ioannis Efstratiou, current director of the DMS, can remain complacent. In fact, he’s anything but. In addition to the much heralded privatisation of the Limassol Port, the DMS has been involved in establishing three new training facilities on the island in recent years and seeks to attract and nurture both shipbuilding and ship repair companies.

Cyprus already serves as the 5th largest third-party ship management hub around the globe, and it’s being recognised as such. Recently, Cyprus hosted Maritime Cyprus, an international event that welcomed delegates from 35 countries and held more than 1,500 industry members in attendance. “Industries here, if you are comparing them with some other country with a huge fleet, the difference is that Cyprus is a shipping community. In Cyprus there is cooperation between the private and government sides” Efstratiou said. In fact, he maintains that DMS’s close collaboration is the key to its success. “We work hand in hand. We have a very close co-operation because it is a win-win situation. We work together to identify areas for further development and this is our recipe.”

One big draw for ship owners is the company’s streamlined tonnage tax system. “We have a system that not only includes ship owners, but ship managers [as well], and this is the reason that Cyprus is considered to be one of the largest ship management centres in the world,” Efstratiou said. According to industry professionals, the DMS is one of the best praised government entities in the country, known for its efficiency and due process. “In respect to shipping affairs – within the EU we have a strong voice and a very good representation.”

The Cypriot government predicted that revenues from the privatisation of commercial operations at the port of Limassol will increase by more than 50 percent, with projections to make more than €2 billion in the 25 years of the concession. Copyright: Luckyraccoon/Shutterstock

With expansions into the Suez Canal in the works, Efstratiou projects this could triple dockings in Cyprus in the not so distant future. Additionally, several oil companies are conducting exploratory drilling for gas in the Aphrodite offshore gas field. “We have the expectation in respect of using gas as a fuel for ships, which is also an ambition of the EU,” said Efstratiou. “So we are expecting that sooner or later, Cyprus will become a centre for fuel bunkers using gas.”

If there is anything that Efstratiou is excited about, however, it is the government of Cyprus’s determination to create a Deputy Ministry of Shipping. Rather than handle the many policy reforms out of the Ministry of Transportation, the shipping industry will have its own specific ministry. “From the 1st March, 2018, our political supervisor will focus only on shipping, and this means more effort for more and more development,” said Efstratiou.” This is a very strong message to the shipping community. Shipping people – we hear your expectations and we understand that it is a very dynamic source for the Cypriot economy.” He says this next step will take the DMS to an unprecedented global level. “Now we are in the process of the complete restructuring of the Department of Merchant Shipping in order to adapt to the new environment and that includes more representations in shipping centres abroad.”

All in all, Efstratiou and his team at DMS have set their sites high in terms of what’s ahead for the company regionally and internationally. The only other thing that could bring more success to an already flourishing company would be domestic peace. Last month, Cypriot President Nicos Anastasiades voiced his appreciation of his colleagues’ support for the Cyprus problem, as the seven heads of state of the 4th South EU Summit drafted a declaration reiterating the need for a viable comprehensive settlement of the Cyprus problem. “If all of a sudden, we find that we have an acceptable solution for the Cyprus problem, I can then guarantee you that in the next 2-3 years the shipping sector in Cyprus will be doubled” Efstratiou said.

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