Tag: history

The Importance of the Greek Fleet – History, Past and Present

TANKER BLUE LIGHTGreek Shipping roots are as old as the Greek Prehistory. Dating back to the time of the Argonauts, a sorority of legendary heroes in Greek mythology, who in the years before the Trojan War, around 1300 BC, accompanied Jason to Colchis in his mission to find the Golden Fleece. Their name comes from their ship, Argo, named after its designer, Argus. The literal meaning of “Argonauts” is “Argo sailors. Greece, a country surrounded by sea, which according to the World Factbook, is the 11th in rank country based on a coastline length of 13,676 km, made an early statement of dominance in the Mediterranean Sea since the ancient times.

The early Greek sailors, loved the sea for the freedom and for the new opportunities that the sea was giving them. Helped by their adventurous spirit, the Greek climate conditions and geographically being located at the important crossroad of the sea trade routes of the time, the Greeks became masters of the seas by overcoming the competition that was spawned by other Mediterranean ethnic groups. The connection of the sea trade with the development of the Greek civilization and Greek colonies of the ancient times in the Mediterranean region was so strong, that it settled the base for a long and an unparalleled maritime tradition. Until the time Greece was conquered by the Romans, the Greek merchant shipping flourished uninterruptedly since the 11th century BC with Alexander’s the Great ruling times setting the Greek sea trade at its greatest glory.

The centuries that followed, even during the period of the Roman dominance, Greeks continued to be heavily involved in the merchant shipping as Romans were more focused on the building of infrastructure and were not so well versed with the matters of the sea. After the period of the Romans and during the Byzantine era, Greek merchant shipping recovered its power for the next ten centuries. Byzantium formed shipping policies that greatly supported the growth of the Greek merchant marine through the centuries that followed. Again, towards the end of the Byzantine Empire, the Greek merchant marine declined significantly. However, the Greeks still offered their services and knowledge on foreign ships.

During the 400 years of the Ottoman Empire occupation of Greece that followed the Byzantine Era, Greek Shipping faced numerous challenges but even in difficult times, it managed to compete or cooperate with shipping super powers of the West. The historical facts that took place during that period are not linear, and there were periods of volatile interdependencies, alliances, economic privileges or economic barriers, new markets as well as new threats. The only sure thing is that Greek Merchant Shipping which underwent several transformations, played a crucial role in the regional and the European economic life and its value was recognized both inside and outside the Ottoman Empire. As the European landscape was going through great historical changes, the Greek Merchant activity was influenced both in positive and negative ways by these changes, while at the same time, it had a rather beneficial impact on the local and European trade. In the 19th century, reaching towards the decline of the Ottoman Empire, the Greek shipping had strengthened and during the Greek Revolution (1821- 1830), many ship owners financed the Revolutionary Army and used the ships in warfare operations against the Ottoman Navy in the Aegean Sea. After Greece gaining its independence, there were certain technological advances that had taken place in the Western Shipping. Greek ship-owners having lost a great size of

After Greece gaining its independence, there were certain technological advances that had taken place in the Western Shipping. Greek ship-owners having lost a great size of the fleet during the Greek war of independence, in order to survive in such a capital intensive industry had to work really hard, offer specialized services and be more flexible from their European counterparts. They succeeded to expand their activity and manage shipping operations both from Piraeus, London as well as from other global major shipping hubs and with steady steps to build again a good recognition and access in the global shipping network. In the 20th century the Greek shipping faced many setbacks, especially during the two world wars that took place, but after that and in the next 50 years, it managed again to grow and prosper despite the challenges it encountered in the 70’s due to two oil crises and the rise of Japanese yen against the United States dollar. It was after the early 90’s that Greek Shipowners started building again at a tremendous pace.

The Greek fleet today: How and why the Greek-owned fleet is the largest in the world

Screen Shot 2017-01-18 at 9.33.05 AMAs at January 2016, the top five ship owning economies (a ranking based on the percentage controlled by each country out of the total world tonnage) were Greece, Japan, China, Germany, and Singapore.
Today, the Greek-owned fleet isScreen Shot 2017-01-18 at 9.33.28 AM still the largest in the world. Ιn 2016 the Greek shipping, according to the latest annual report of the United Nations trade service, UNCTAD, the share of the Greek-owned fleet is 16.36%, versus 16.1% a year ago and 15.5% in 2014.


A country so small and yet managed to dominate the seas of the planet. When we come to numbers, the Greeks manage 4,600 ships, i.e. 20% of the world fleet (in dwt) and 50% of the European. Greek ship owners control a total of 4136 ships, against 4.017 ships in 2015. Moreover, the contribution to the Greek economy is significant as Greek shipping contributes 7% of Greek GDP, maintains 192,000 jobs and has contributed 140 billion Euros in the balance of payments of Greece in the last decade. The size of the Greek fleet by capacity amounts to 293 million Tons dwt versus 279.4 million Tons last year.

*See the next pages for more statistical facts about the global ownership of the world fleet in the form of graphs.

Total Dead-weight tonnage 2016  Screen Shot 2017-01-18 at 9.33.47 AM

Total Market Share

Screen Shot 2017-01-18 at 9.36.44 AM

Legitimate Uses For Offshore Companies: Past and Present

Offshore financial facilities have evolved remarkably due to economic globalization, political and economic instability, technology advances and evolution in telecommunications. These dimensions have led to a significant increase in the demand for offshore operations. The offshore company industry has developed into a major international business, linking all regions, comprising, in one way or another, roughly half of the world’s international lending and deposits by value. However, despite the fact that we live in a globalized and open economy that offers numerous options for investments and capital mobility, still offshore companies and offshore financial structures are often in the middle of worldwide controversies, attracting considerable attention which eventually harms the reputation of these financial and trade facilities. The undisputable fact is that these low- tax overseas jurisdictions are an important and indispensable part of the global financial system and the reason, of course, is not their illegal use by some entities. Nevertheless, before seeing the real reasons that offshore companies have legitimate and important uses in the global trade and economy we will first take a look on the origins of these tax-efficient economic zones.

Old Map Light Blue

Historically, in order to boost trade, increase capital movement, and secure trade gains, free-tax economic zones were developed, since the 2nd century B.C. in the Mediterranean region and especially in the area of Greece with the Delos island playing the role of the special economic zone. The type of trade that was taking place there, was free of customs duties and it faced no taxes. Important role to this economic regime of that time, played of course the geographical positioning of the island. Throughout the history, the generation of low-tax states always serviced the needs of traders and seamen.  From the medieval period to the industrial revolution, the need for friendlier towards the commerce regimes never stopped. The important fact here is that most of the times these beneficial economic zones existed in islands and ports, the places where the real risk takers, the seamen traders were living and working when they weren’t in the sea. By reaching the 19th century and the 2nd industrial revolution with the respective expansion of capitalism, these tax-friendly jurisdictions also grew. It was after the First World War that European and United States tax rates started rising. This, combined with the increased global uncertainty of that period and the easy methods of incorporation in the offshore jurisdictions, led to the growth of these jurisdictions like for instance the ones in the British overseas. In a post-colonization era, and as the economy was becoming more interconnected and the foreign direct and indirect investments grew, the demand for international financial services increased. The Demand for global offshore financial facilities also grew in the 1970s, partially because of the substantial amount of money that petrostates needed to reutilize after OPEC effectively raised oil prices. Moreover, the downfall of the Bretton-Woods system also increased the risks from the exchange rate fluctuation. The international nature of cross-border businesses led to the increase of cross-currency transactions in all the quarters of the world and the need for international management of cash and tax planning by the companies, made the need for offshore companies and offshore structures and financial services to flourish. Of course, in the course of history, there were entities that misused these business friendly offshore facilities in order to promote illegitimate practices and this is something that can only be regulated with global efforts and cooperation between countries. However, there is a global legitimate use and need for these jurisdictions that make the global trade easier and more efficient, especially in a period where the global economic, political and geopolitical risk is elevated.

There is a variety of reasons for the utilization of offshore companies and structures both for legal and physical entities. The focus of this article is on the corporate users of the offshore companies and facilities.  

From Holding companies to royalty and intellectual property companies, major financial institutions, shipping companies, middle market companies that seek international expansion, multinational corporations, and conglomerates, they may need at some point of their corporate structuring to conduct their operations through offshore entities that will facilitate the specific characteristics of a particular business need. For instance, it is common practice in the shipping industry to use constantly offshore companies in order to facilitate its global trade and banking needs in the most efficient way particularly when there is the need for a ship registration or for a Flag of Convenience. Another example has to do with treasury management operations. The ultimate goal of treasury management is managing the firm’s liquidity and mitigating its operational, financial and status risk by concurrently taking care of the investment and funding activities. The treasurers of corporations often allocate their money market instruments and cash resources between their subsidiaries which as a process, is regularly carried out through offshore facilities and structures. It is also common for International joint ventures to be often structured as offshore companies when the parent entities want to keep the venture as jurisdiction neutral. Other important legitimate uses for offshore companies is that they can be used as asset holding companies where risky assets are held isolated from the main entity, thus reducing any unnecessary risk transition to the rest of the group. In the case of a company having non-risky assets that it wants to protect from a politically unstable environment where the rest of the firm operates, then with the use of an offshore company can accomplish that goal also. Investment companies also use offshore companies at a great extend in order to invest in derivatives and securities trading without facing regulatory limitations for their investment and trading undertaken risk. Finally, companies expedite their capital raising needs both in equity and debt capital markets, by forming offshore companies. This usually happens as in many occasions, a more efficient and simple structure may be needed or the existing legal framework of the main country of operation, may not support or help the company raise capital in a non-conventional way.

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