Greek Shipping and economy 2020: The Strategic And Economic Role Of Greek Shipping

Global Shipping Outlook
The pace of global economic activity remained weak throughout 2019, with declining momentum in manufacturing activity and rising trade and geopolitical tensions, especially between the United States of America (U.S.) and China. Uncertainty about the future of global trading system and international co-operation more generally has had an impact on business confidence, investment decisions and global trade1, with trade volumes increasing by a marginal 0.3% in 20192. Projections for trade volume growth in 2020, prior to the new coronavirus (COVID-19) outbreak, hovered around 2.7%3, denoting a fragile recovery anyway. The unprecedented global crisis that was brought about by the coronavirus pandemic has made the outlook for the global economy and international seaborne trade for 2020 even more precarious and gloomy. For example, the World Trade Organization (WTO) forecasts4 that the world trade is expected to fall by between 13% and 32% in 2020.

Financially, many shipping sectors have been faced with a sudden and steep drop in demand, which in turn has considerably affected freight rates and earnings. In the dry bulk segment, for example, average daily earnings between January and April 2020, compared to 2019, were more than 85% lower for capesizes, 40% lower for Panamaxes and 35% lower for Supramaxes5. Though these rates could recover somewhat as Chinese factories come back online, the looming global recession and accompanying drop in global demand resulting from the lockdowns in Europe and North America have severely impacted on demand for shipping services.

The lockdown in Europe and North America will have considerable knock-on effects on employment rates, too. The International Monetary Fund (IMF) has declared that the COVID-19 pandemic will likely push the global economy into its worst recession since the Great Depression6, warning that prospects over a global rebound are highly uncertain. The recession in shipping is projected to last more than a year and shipping activity is not expected to improve in the following few months. This is also because, with shipping being a global industry, much of its activity takes place in the southern hemisphere, where major exporting countries of raw materials, such as Brazil, have only recently started being hit by COVID-19 as hard, if not harder.

The Greek-Owned Fleet
The top five shipowning nations include Greece, Japan, China, Singapore and Hong Kong. These five countries account for more than 50% of the world’s tonnage. In recent years Germany, Japan and the Republic of Korea have been losing ground, while Greece, Singapore, China and Hong Kong have increased the size of their fleet7.
Greece remains the world’s largest shipowning nation. Though the country accounts for only 0.16% of the world’s population, Greek shipowners own 20.67% of global tonnage8 and 54.28% of the European Union (EU)-controlled tonnage (Figure 1)9. Between 2007 and 2019, Greek shipowners have more than doubled the carrying capacity of their fleet (Figure 2)10, while they control (Figure 3)11:
• 32.64% of the world tanker fleet, 15.14% of the world chemical and products tankers and 16.33% of the global LNG / LPG fleet,
• 21.7% of the world bulk carriers, and
• 8.92% of the world container vessels.