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Wednesday, February 7, 2018

The Miraculous Greek Merchant Fleet!

This article from the Ekathimerini reports what most people assume to be a fact, anyway. Namely, that Greek shipowners are the Number One in the world's merchant fleet. Specifically:

* over 4.500 ships are valued at 100 BEUR
* Japan ranks in second place with 89 BEUR
* China ranks third with 84 BEUR

I have said this in a previous posting: The fact that entrepreneurs from a relatively small country of 11 million people, a country which really doesn't have a track record of successful economic and/or business performance, would reach such a position is quite mind-boggling to me. True, Greece - surrounded by water - has a history of seafaring but so have other countries. Spain or Portugal have similar histories and the UK used to rule the waves. And, by the way, where are the Americans?

What puzzles me about Greek shipowners is the following: they obviously know what it takes to be successful and they obviously understand why their country is not successful. They must see that every day. Why in the world do they not take a role in making their country successful???

28 comments:

  1. Yes, you have pondered this puzzle before, and I think I have indirectly answered it before.
    Could the Greek ship owner's receipt for success be that they:
    -Finance their vessels in Chinese or Korean banks.
    -Build their vessels in China or Korea.
    -Man their vessels with Philippine crew and officers.
    -Classify their vessels in Norwegian classification societies.
    -Insure their vessels with British underwriters.
    -Repair their vessels at Chinese or Turkish shipyards.
    -Transport their gods for international companies.
    -Operate outside Greek jurisdiction.
    In short, have no interface with Greeks or the Greek nation, that success model cannot be transferred to "running Greece".
    Lennard.

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    Replies
    1. I might add
      -Take up residence in Switzerland

      Urs

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    2. You want Greek shipowners to pay Berlin taxes? They are not that stupid you know.

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    3. "Running Greece" according to the German plan? I think you are a bit late in the game. Some Greek think tanks are on to you already:

      https://slpress.gr/diethni/germaniki-yponomefsi-me-anakalypsi-ethnotiton-sta-valkania/

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    4. Exactly, the only "greek" in the Greek shipping business are the greek surnames of the major shareholders. Nothing else.

      You could actually make the hypothesis that they are successful, BECAUSE they have NOTHING to do with Greek business or the Greek state!

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    5. Why on earth should I (based in Zug and Zurich) want Greek shipowners to pay Berlin taxes? The more interesting question is why you don’t want them to pay Greek taxes.

      Urs

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    6. Urs:

      Because Berlin taxes and Greek taxes are one and the same.

      Btw, how would you justify for an enterprise whose business is to move global merchandise by sea to pay taxes in a land location? Is the sea part of land? How do you make the connection of where taxes needed to be paid when the very nature of the business is to be everywhere but in the specific land registry location?

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    7. Urs:

      What if I told you that Greece is sitting on $7 Trillion (yes, you heard right $7 Big effing Trillion) of hydrocarbon deposits? Would you then stop concerning yourself with the Greek shipowners, who by the way have to transport the stuff to global markets for use?

      https://slpress.gr/oikonomia/endeixeis-yparxis-gigantiaion-koitasmaton-stin-ellada/

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    8. International Capitalism: it's all Greece's fault.

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    9. To Urs at February 7, 2018 at 7:01 PM

      And why do you think this is?

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    10. @ Anonymous February 8, 2018 at 2:16 PM

      So shipping companies have no bank accounts, headquarters, management, owners? So why on earth are we talking about the "Greek Merchant Fleet"? Your claim, that shipping companies can not be taxed because of the nature of their business is absurd.

      Urs

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    11. @ Anonymous February 8, 2018 at 2:32 PM:

      I would be amused that the greek oil and gas delusion is still alive. But I understand that it is easier to dream up hidden riches than to get your elites to pay their taxes.

      Urs

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    12. @Anonymous February 8, 2018 at 8:27 PM
      1. Low taxes
      2. Political stability
      3. First class infrastructure

      Urs

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    13. To Urs February 10, 2018 at 3:04 PM

      And...

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  2. Mr. Kastner,

    Your question is a bit naïve?

    Granted, most Greeks outside of Greece are quite successful. Everyday you hear about Greeks abroad successes. While Greeks in Greece fight 10 times as hard to make their achievements. Why are they successful outside of Greece? For me it is quite simple. After being suppressed in Greece, followed by healthy economical social exposure, Greeks are free to do what they want without headaches. Create.

    When you look at shipping magnets, these are families and owners of the past which hold ties to Greece but they know well as to shuffle their influence to many countries. (Old Greek Saying. Don't keep your eggs in one basket.) It is simply good business. Their interests of course always in the best of their companies. And their pockets. Meanwhile they rub elbows with the most influential people of the world. Why give a crap of their roots? Some do but only on a minor extent. Only To save face at home. Their goal is to grow, compete between each other and obliterate the competition. They are doing it. I am proud of them.

    I am originally from a Greek Island where we have the 2nd largest Greek shipping families. Donations locally are common and you see schools roads infrastructure erected. But up to there. Some have offices in Piraeus but they are not the central offices.

    My thought is they do not want to deal with the local government which is volatile to changes from year to year. But they do maintain a certain amount of flags under Greece. Tax reasons. And this should remain as is.

    Unless, specific sectors like ports, port foundries and transport networks are not privatized and worker unions eased, ship owners will maintain a distance to Greece. If the above change and local mentality changes, it will then be in their interests to further invest on a large business scale in Greece.

    I believe this too will come.

    Sincerely,
    V

    Short story to follow:

    ReplyDelete
  3. Short Story,

    The growth period of 2000 till the crash of 2008, we saw a large growth of (non Greek) ship owners and companies buying contracting and building newer and bigger ships. In all sectors of shipment. The Greeks on the most part withheld from large purchases, only lean management supplies.

    When the crash came in 2008 and you all remember the thousands of ships anchored in the bays of asia.

    Half of those growing companies went belly up. The other half fire-saled half of their fleets. Greeks then went to those companies and contractors and purchased the completion of the existing and new ships at a fraction of the original cost. Contractors accepted as to reduce their losses. In the period of bottom barrel Greeks bought up everything and maintained till growth came back. Now they dwarf the competition.

    (Insider Information and i can not detail.)

    V

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  4. Klaus:

    The Greeks are people of the sea. In contrast, the Germans and Austrians are people of the land.

    The big difference between people of the sea and people of the land is that you have to be smart to survive in the sea. Not so, if you have to survive on land. Fools could easily survive on land by sticking together like the proverbial "school of fish" (pun intended), adopting the same opinions, punishing differentiation and demand obedience.

    Therefore, I have to assume that you are not aware of such key difference when you ask seafaring people to become bureaucrats and administrators of land matters. No seafaring person worth his/her salt (pun intended again) would ever deal with land nonsense.

    Btw, the new economy minister of Germany is Mr. Olaf. What do we know about him?

    https://en.wikipedia.org/wiki/Olaf_Scholz

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    Replies
    1. As regards Greece, I expect Olaf Scholz to be a much more pleasant via-à-vis than Schäuble was. He does, however, have the reputation of being a disciplined politician so don't expect freebees. If Schäuble was seen by many as destructive, Scholz will probably be seen as constructive.

      BTW, the Finance Ministry seems to have been Merkel's price for being able to continue her career. There is no objective reason why a coalition partner who has become significantly weaker than in the previous coalition should get more power in the new coalition. The SPD must have put the screws on Merkel: "either give us the Finance Ministry or there won't be a coalition and if there is no coalition, there will not be a government, there will be new elections and you won't be the CDU's candidate in those elections". Some (few) people think that Merkel made the sacrifice for God and Fatherland at the expense of her party but those are the believers.

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    2. Obviously Olaf is the product of horse trading. But he comes at a time that it makes little difference for Greece who the German FM is.

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  5. Tough times for the New Democracy idiots. These guys will never see power again:

    http://www.tornosnews.gr/en/greek-news/economy/29922-european-commission-greek-economy-to-grow-by-2-5-in-2018-and-2019.html

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  6. @ URS.
    Yes that as well, and they are in good company, even MSC's owners, the Italian Aponte family, have pitched their tent in Geneva.
    Lennard.

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    Replies
    1. Please be careful....

      http://www.gazzetta.gr/plus/diethni/article/1195837/o-aynanismos-skotonei-80-100-germanoys-ton-hrono

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  7. Let's forget for a second the "miraculous Greek merchant fleet" and let's talk logistics instead.

    According to this article the new logistics market in Greece has the potential of 30% to GDP, in other words, 3 times the GDP impact of the Greek heavy industry we know as tourism.

    http://www.ypodomes.com/index.php/metafores/odikes-logistics/item/45270-nees-megales-ependyseis-allazoun-to-topio-sta-logistics

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  8. @ KK.
    On the basis of facts you would make that assumption, but mentioning facts would then seem obnoxious.
    Lennard.

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  9. That Greece has USD 7 trillion worth of goods in their backyard, and the world fleet to transport them, do change the power balance in the negotiations with Europe. In fact it makes a good case for leaving the EU and EZ, I wonder if I could tempt you to let Europe sail it's own sea and keep it all for yourself?

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    Replies
    1. What negotiations with Europe? What sort of nonsense is this that Greece is in negotiation or has to negotiate with a geographical destination?

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    2. No problem! First we are going to make you pay for all the feasibility studies of the EuroAsia and EuroAfrica cable interconnectors through Cyprus, then fund their construction along with the EastMed gas pipeline so we can transport the stuff for free and then we will give you a glorious kick in the pants. I have zero problems with this excellent idea.

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  10. Yet another paradox. Greeks abhor capitalism, globalism, big business and foreign influence, but they adore their ship owners. Success by proxy?

    ReplyDelete