5 October 2025 - CUS Dinner with H.E the President of the Republic of Cyprus, Mr. Nikos Christodoulides - Presidential Palace, Nicosia

ADDRESS BY THE PRESIDENT OF THE CYPRUS UNION OF SHIPOWNERS, MR. ANDREAS HADJIYIANNIS

Your Excellency, President of the Republic of Cyprus,

We warmly thank you for dedicating this evening to host, at the Presidential Palace:

• His Excellency, the Secretary-General of the International Maritime Organization, Mr. Arsenio Dominguez,
• The Honourable European Commissioner for Sustainable Transport and Tourism, Mr. Apostolos Tzitzikostas,
• Our dear former President of the Republic of Cyprus, Mr. Nicos Anastasiades,
• The Honourable Minister of Shipping and Island Policy of Greece, Mr. Vassilis Kikilias,
• His Excellency, the Minister of Transport of Qatar, Sheikh Mohammed Bin Abdullah Bin Mohammed Al Thani,
• His Excellency, the Minister of Transportation and Telecommunications of the Kingdom of Bahrain, Dr. Shaikh Abdullah Bin Ahmed Al Khalifa,
• The Members of Parliament, Ministers, and officials of the Republic of Cyprus, the European Parliament, the European Union, as well as representatives of states from the international community,
• Along with the distinguished figures of the international shipping industry.

We sincerely thank each and every one of you for being here this evening, on this night dedicated to shipping and to the 2025 Shipping Conference. Your presence is an honor. A message of prestige and strength, which elevates our conference into an event of broader significance.

After the end of the Second World War, the world was divided:

• On the one side, the democracies with market economies and internal competition,
• On the other side, the states with centrally controlled economies, without competition.

The shipyards of the free market economies, through competition, gave rise to technology and innovation. A thousand Greek shipping companies, in fierce competition, transformed shipping, what economists call “almost perfect competition,” driving transport costs dramatically down.

Perfect competition in the free world:

• made transportation nearly costless,
• broke the barrier of distance,
• “abolished” borders and paved the way for commercial integration,
• accelerated international specialization,
• spectacularly increased productivity,
• and unlocked comparative advantage.

This is the miracle of shipping:
the invisible backbone of the global economy,
the catalyst of integration,
the engine of prosperity.

Ricardo had stated it clearly: “Every country prospers, when trade is guided by its comparative advantage.”

The West, the only nuclear power at the time, at the historic turning point of its confrontation with communism, did not need to rely on its strategic superiority. The Soviet Union could not keep pace with this spectacular development; it collapsed bloodlessly, and the peoples of Eastern Europe were liberated.

And yet, the great victory of the West was not utilized. Instead of supporting Russia, so that it could integrate into the free market, it was allowed to return to monarchy. The historic opportunity was lost. At the same time, China was showing its own path.

The West, carried away by the arrogance of its victory over the Soviet Union, did not wait for the social maturity and transition of the country into a free market economy. It opened its markets, thus supporting the very economic system it believed it had defeated.

What the West did not anticipate was:

• that shipping, which had granted its victory over the Soviet Union, would become the connecting bridge of the global economy and the vehicle of China’s rise,
• that it would automatically carry the output of China’s inexhaustible cheap labor force to Western markets,
• that the “cheap labor – cheap transport” dipole would bring not only exports, but also the very factories and technology of the West,
• that once this advantage was unleashed, the West would have no answer: factories, jobs, and know-how would be lost; China would move from imitation to strategic superiority.

Chinese products would flood global markets. Dependence would become a worldwide norm. Thus, the country that had rejected the model of the free market would acquire the means to claim strategic superiority.

Peter Drucker said: “Productivity is not everything; but in the long run, it is almost everything.”

The crucial point was not mere imitation; it was that all of this unfolded without China joining the free market: remaining one State – one industry, without internal competition. As industry shifted to China, trade and shipping expanded. And when you control transportation, shipping becomes a superweapon.

In just 25 years, China acquired the world’s largest fleet and over 70% of shipbuilding production. This is not just economics. It is geostrategy.
He who controls the shipyards controls the ships. He who controls the ships controls trade. And he who controls trade, wields power—without raising a voice.

As Sun Tzu said: “The supreme art of power is to subdue the enemy without fighting.”

Even today, the danger is not immediately visible. The current fleet, still a product of competition, remains fragmented and in near-perfect competition. While China builds its future, Europe rests on:

• excessive debt,
• cheap imports,
• the illusion that services and tourism are enough.

Instead of strengthening the competitiveness of its industry, it traps itself in extreme measures of “decarbonizing” shipping.

We all worry about carbon dioxide: the 400 parts per million in the atmosphere. But we must not overlook that almost 90% of these 400 parts are beyond human influence. Of the remainder, roughly 10% comes from human activity, and only one-fiftieth of that is attributable to shipping. That is, it corresponds to just one to two millionths of the atmosphere.

For this nearly negligible environmental benefit, Europe is imposing levies worth billions, which harm the competitiveness of European shipping companies, characterized by low concentration. At the same time China appears as one State – one industry, one shipping sector with unified power.

We reacted and took the lead in establishing the “commercial operator” of the vessel and transferring the majority of the fees to them. A critical breath of logical consistency. A brake on the risk.

Today? Europe, together with China, is promoting the ‘Net-Zero Framework’ (NZF). A framework with enormous levies for shipowners until 2050. A system that does not reduce emissions but merely taxes. A system that burdens without remedying, since alternative fuels are not yet available for use and technological improvements cannot deliver meaningful environmental benefits to the atmosphere.

China supports it, because it serves its dominance in shipbuilding. It knows that today’s ships, under this taxation, will be prematurely scrapped, and that China itself will replace them.

China is building its future. Europe has nothing to gain from the early dismantling of its fleet. Instead of first securing its own foundation, Europe creates a market distortion, feeding Chinese supremacy.

Years before it gained global traction, we warned of the geopolitical risk of overconcentration in shipbuilding. Today we are paying the price for delay: economic vulnerability, political silence, lack of strategy.

The goal remains clear: Progress. Industrial continuity. Shipbuilding capability.

With the foundation of self-sufficiency:

• no complacency,
• no imported promises,
• no borrowed prosperity.

After years of silence, strategic awareness returns to public discourse.

Cyprus is assuming the Presidency of the European Union. An opportunity to bring shipping and competitiveness back to the forefront. To unite the European Union in a common strategy of self-sufficiency. Cyprus has proven that when it speaks about shipping, Europe cannot ignore it.

And today we are not alone. The concern is global. Voices are multiplying. The United States is already taking the lead:

• shipbuilding within America itself,
• investments to revive the industry,
• massive tariffs to protect domestic production.

But the competition is uneven: autonomous, low-concentration units versus one State – one industry – one shipping sector. This cannot be corrected by tariffs alone.

History has shown: shipyards in the US and Europe are not sustainable. The problem is international. The solution is too.

The solution lies in strategic self-sufficiency and international cooperation. A network of shipyards in free-market countries:

• with a competitive workforce,
• with cutting-edge innovation and technology,
• with cooperation from Japan, Korea, and other nations,
• and political support from the US, EU, and free-market countries.

Without production, there is no sovereignty. Without self-sufficiency, there is no strategy. No taxes on shipping. But a collective, effective, sustainable solution that guarantees the continuation of competitive shipbuilding.

Otherwise, the West risks handing over the keys to shipping, and then the hope of regaining our competitiveness will be lost forever. Then the historic West – of the Enlightenment, the Industrial Revolution, Technology, and Innovation – will become merely a service provider.

Montesquieu said: “Commerce is the natural cure for prejudice and the foundation of peace.”

And Churchill added: “The open sea is the symbol of freedom. Whoever controls the seas holds the key to History.”

Ladies and Gentlemen,
The West won the Cold War. It cannot lose Peace. It still has the power. It still has shipping.
The future will be written by the free economy.
And it will be written upon the sea.

Your Excellency, Mr. President,
with our warmest thanks for your hospitality and with gratitude to all of you for your presence,
we wish you health and prosperity.