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Small increase in shipping revenue despite geopolitical tensions

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For the whole year, ship management revenues amounted to €1.26 billion, corresponding to 4.23% of the country's annual GDP

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<p>The second half of the year showed a small increase in revenue from ship management, despite the challenges facing the shipping industry, such as rising transport costs and geopolitical tensions and obstacles to navigation, such as the Houthi attacks in the Red Sea.< /p> </p>
<p>According to the Ship Management Survey conducted by the Central Bank of Cyprus (CBC), revenue from ship management (in terms of turnover) in the second half of 2023, increased by 2.4% to €638 million. from €623 million in the first half and constituted 4.1% of the six-monthly GDP of Cyprus. For the whole year, ship management revenues amounted to €1.26 billion, corresponding to 4.23% of the country's annual GDP.</p>
<p>“Despite the many challenges facing the shipping sector worldwide, such as rising transport costs, the ship management industry remains a strong player in the Cypriot economy”, reports the CBC.</p>
<p>In terms of sector revenue by country of residence, Germany remains consistently the main trading partner with the country's contribution holding steady at 40% of total revenue. Greece followed with 17%, Switzerland with 10% and Malta with 5%. Small decreases in contributions were noted by the US and Norway, as reported.</p>
<p>At the same time, 31% of ship management companies generated revenues between €2 and €30 million, while 27% of companies managed to generate revenues in excess of €30 million each. Also, 18% of the companies generated revenues between €30 million and €100 million and 15% presented revenues up to €300,000. A percentage of 8% of the companies presented revenues in excess of €100 million.</p>
<p>According to the survey, the revenue structure remained more or less stable from the first half of 2022, while compared to the previous period, the share of crew management services increased to 51.1% of the total amount of ship management revenue in the second half of 2023.</p>
<p>In contrast, fully managed services declined from 48.6% in the first half of 2023 to 46% of total revenue in the second half of 2023.</p>
<h3 class=Reduction in costs

According to the CBC, ship management expenses further decreased to €546 million in the second half of 2023, in contrast to the increase in expenses, which occurred in the second half of 2022 (€629 million), with the industry historically showing a relatively fixed cost structure.

The majority of these concern crew costs, which made up 65% of the total amount in the second half of 2023.

Most of these payments, in 45%, related to wages of non-EU seafarers. Administration costs increased to 7%, while ship management costs (e.g. spare parts, oil, ship docking, etc.) increased to 28% of the total amount during the second half of 2023.

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Source: www.kathimerini.com.cy

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