As the Greek government and European Union (EU) ministers continue their ongoing game of chicken with the country’s economic future, little has been said or written about the impact on the Greek shipping industry and its relation to the world economy. While Greece accounts for just 0.4% of the world’s economy (source: Bloomberg News), Greek owned shipping, and its handful of billionaire owners (think Aristotle Onassis), move 15% of all the world’s ocean freight. In a world where 95 percent of all freight moves by ocean, you would think that the consequences of a Greek financial meltdown would be catastrophic to shipping, and thus the world economy as a whole. Fortunately, such is not likely to be the case.
Shipping in Greece has long been a source of national pride. Greek shipping tycoons are typically happy to speak with the press and are quick to brag about their expansive wealth, their collection of super-yachts and palatial homes, and the fact that Greek shipowners command the biggest merchant fleet on earth. However, these days, getting Greek shipowners to talk about their wealth — or how they might help solve the the country’s seemingly insurmountable economic problems, the aftershocks from which could threaten the financial stability of the entire European Union — is like trying to interview Blackbeard about where the treasure is hidden.
The question is, will the handful of shipowners, who single handedly comprise the wealthiest segment of the Greek population, make the sort of financial investment at home to create jobs and spur investment that could save their country? The answer is anyone’s guess. For almost two years now the Union of Greek Shipowners has urged its members to avoid talking to the press at all.
As the talks drag on and this weekend’s referendum seems to repudiate the EU’s latest bailout offer, the Greek shipping tycoons remain seemingly indifferent to the chaos at home. As recently reported in the UK’s The Guardian newspaper, shipping may be a source of Greek national pride, but it is also a source of resentment. Greece’s 1967 constitution stipulates that the industry pays no taxes on the international earnings it brings into the country. As such, the owners have little to fear from either the debt crisis or an exit from the euro.
“It’s not really affecting us because we’re not Greek companies: we’re based abroad,” said a tanker owner who requested anonymity in view of the sensitivity of the situation. “The law allows us to have a ship registered in Liberia or Panama and an office in Greece. If everything collapses, we can leave the next day and establish in Cyprus or wherever.
“Our business is done in US dollars and shipping companies don’t just have one account in one country,” he said. So, not even the imposition of capital controls on Monday had any impact on Greece’s ship owners.
What will be the final outcome in the ongoing Greek circus in Europe is anyone’s guess at this point. However, one thing is clear. Whether the coin of the realm in Athens turns out to be Euro’s, drachma or dollars, the billionaire boys club of Greece seems certain to navigate the choppy waters and sail on smoothly as their predecessors have done for thousands of years.