The risk of their further de-Hellenization is obvious. coastal transport in Adriatic Sea as the European Union approved a $500 million plan by the Italian government to subsidize Italian private ferry companies in late 2022.

This program will finance the modernization of the Italian coastal fleet in order to drastically reduce carbon emissions and possibly bring them to zero. At the same time, in Greece, the only relevant provision is the inclusion of loans to the Greek shipping industry totaling 100-150 million, interest financing, which, according to estimates, cannot cover the needs of the Greek fleet and which will de facto be put at a disadvantage in the Adriatic because of the disproportionately higher financial burden, both equity and loans, that it will be forced to take on.

OUR European Commission endorsed the measure, exempting it from the ban on government subsidies, citing its contribution to achieving the goals of the European Green Deal and the Commission’s 55-year-old Ready package. The development of a similar Greek program, subject to the allocation of the necessary funds, could not only balance the competition with Italy, but also give impetus to the restructuring of the Greek shipbuilding industry, in particular, the shipyards of Scaramangas and Elefsina, as well as the shipyards of Chalkis, Salamina. Shipyards and others.

According to XRTC Business Consultants, a Greek maritime finance consultancy, it is estimated that around 3 billion euros will be needed to renew the Greek coastal fleet by the end of this decade. And that’s because 50% of Greek coastal ships currently sailing will be over 40 years old in 2035, according to the Passenger Shipping Companies Association (SEEN). Thus, renewal of the coastal fleet is one of the biggest challenges the industry has to face. In addition, although the deadlines for achieving reductions in pollutant emissions have been set, technologically sustainable solutions to replace them with renewable sources such as electricity, biofuels, ammonia, hydrogen, methanol, etc. have not yet been achieved.

Investments in the order of 3 billion euros to renew the Greek coastal fleet are considered necessary both because of the prospect of aging the existing fleet and the need to comply with new regulations on emissions of exhaust gases and other pollutants. It is estimated that part of the necessary funds may come from European funds, and the other from state support, but companies will bear a greater burden at their own expense, relying, in turn, on loans from banks and investors. However, the approval of a $500 million subsidy program in Italy, where there are coastal shipping companies that directly compete with Greek ones in the Adriatic, is estimated to put significant pressure on Greek companies.

“Funding for fleet renewal investments with low and zero emission vessels should be in the form of subsidies for the green part of the investment with access to affordable financial instruments through the Recovery and Resilience Fund, NSRF and the New Development Act, but also possibly with the creation of a special fund under the European Emissions Trading Scheme (ETS) to reinvest ETS revenues directly into the industry,” suggests XRTC Business Consultants. At the same time, he adds, “companies are hoping that multi-year public service contracts can be used as a tool to help bank financing in combination with the aforementioned financing tools.”