Ship Management Revenues in Cyprus Rise Slightly in 2023
Germany Remained the Primary Commercial Partner
Ship management revenues in Cyprus saw a slight increase in the second half of the year, despite challenges in the shipping sector such as rising transportation costs and geopolitical tensions, including Houthi attacks in the Red Sea.
According to the Ship Management Survey conducted by the Central Bank of Cyprus (CBC), ship management revenues (in terms of turnover) increased by 2.4% to €638 million in the second half of 2023 from €623 million in the first half, accounting for 4.1% of Cyprus's semi-annual GDP. For the entire year, ship management revenues totaled €1.26 billion, representing 4.23% of the country's annual GDP.
“Despite numerous global challenges faced by the shipping sector, such as rising transportation costs, the ship management industry remains a strong contributor to the Cypriot economy,” the CBC reported.
Regarding revenue by country of origin, Germany remained the primary commercial partner, consistently contributing 40% of total revenues. Greece followed with 17%, Switzerland with 10%, and Malta with 5%. The contributions from the USA and Norway saw slight decreases.
Additionally, 31% of ship management companies generated revenues between €2 million and €30 million, while 27% of companies generated revenues exceeding €30 million each. Moreover, 18% of companies reported revenues between €30 million and €100 million, and 15% had revenues up to €300,000. A further 8% of companies reported revenues exceeding €100 million.
The survey indicated that the revenue structure remained relatively stable compared to the first half of 2022. However, the share of crew management services increased to 51.1% of total ship management revenues in the second half of 2023, while full management services decreased from 48.6% in the first half to 46% in the second half of 2023.
According to the CBC, ship management expenditures decreased further to €546 million in the second half of 2023, in contrast to the increase in expenditures observed in the second half of 2022 (€629 million), with the sector historically showing a relatively stable expenditure structure.
The majority of these expenses pertained to crew costs, which constituted 65% of the total amount in the second half of 2023. Most of these payments (45%) were for the wages of seafarers from non-EU countries. Administrative expenses increased to 7%, while ship management expenses (e.g., spare parts, lubricants, ship dry-docking, etc.) rose to 28% of the total amount in the second half of 2023.