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New global shipping hubs to threaten Piraeus

Photo: EY - Greece Giannis Pierros-EY Greece.jpg
Traditional shipping centres such as Piraeus will face increasing competition with the rise of new hubs over the next 20 years.

Shipping is the most extroverted sector of the Greek economy being a source of income, wealth and prestige for the country. Further, as home of the world’s biggest ship operating community the Greek cluster ranks the country among the most important shipping centers in the world.

However, “as competition between major shipping centres is expected to intensify, it is very likely we will see the rise of new major shipping hubs within the next 20 years, which may threaten the traditional world shipping centres, including Piraeus,” warns Ernst & Young (EY) Greece.

This was the stark warning Giannis Pierros, a senior partner of EY Greece delivered when addressing the 7th Analyst & Investor Capital Link Shipping Forum, last week as part of the Posidonia ‘Time to Talk’ forum.

Pierros said four key factors contribute to the attractiveness of a city or region as a global shipping hub: The presence of significant local ship ownership or ship management activity; Strong financial, legal and other specialised business services; The existence of significant port and supply chain infrastructure; and A tradition of marine technology, related to innovation, R&D, training and human resource availability.

Greece, despite its shipowning and ship management sectors “has not made significant progress in the other three sectors” said Pierros.

 "The existence of important port infrastructure and logistics infrastructure, able to serve the growing volume of cargo arriving from Asia enroute to Central Europe, along with the strong presence of Greek-owned shipping and the geographical location of the country, is the key for Greece to be able to improve its performance and claim a place among the strongest global shipping centres,” said Pierros.

He said for Greece to make the most of the potential of its strong shipping industry, it will have to develop and further strengthen the transport and logistics sectors, which can have a multiplier benefit for the Greek economy.

He said the country’s geographical location, along with the more than 25 ports operating around the country, along with the most developed motorway network in Southeastern Europe and the five Free Trade Zones, give Greece a comparative advantage as a regional and international transit centre.

He said that indicative of the country's potential is the remarkable progress it has made in terms of its connectivity with international shipping networks. According to shipping’s Liner Shipping Connectivity Index, Greece, ranked 69 in 2011, but in just eight years has managed to improve its performance and in 2019 ranked 20th worldwide ahead of competing countries of the region.

Referring to an EY survey in 2019, among business executives who extensively use of the ports and infrastructure and logistics services of Greece, over 40% rated the port of Piraeus as excellent, in terms of the quality of infrastructure and services offered, its availability / capacity, as well as the effectiveness of the cooperation.

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