Cyprus charts course for sustainable maritime growth

An exclusive SMI interview with Marina Hadjimanolis, Shipping Deputy Minister

Cyprus is entering its next phase of maritime development from a position of confidence, with rising registry tonnage, strong ship management revenues and a broader cluster strategy aimed at deepening the island’s role as one of Europe’s most established shipping centres.

Speaking to Ship Management International, Marina Hadjimanolis, Cyprus Shipping Deputy Minister, set out a picture of a maritime jurisdiction that is not only growing, but also seeking to strengthen its appeal across the full range of shipping services, from ship management and flag administration to legal, insurance, technology and cruise activity.

At the heart of that message is the view that Cyprus has already built a strong platform for further expansion.

“Cyprus enters this period from a position of genuine strength. Shipping now contributes more than 7% of GDP, and over the past two years the Cyprus Registry has grown by 23% in gross tonnage, reaching its highest level in two decades. Ship management revenues exceeded €978 million in 2025, and the number of companies within our tonnage tax system has increased by around 17%. Growth in the months and year ahead will come from three principal directions,” said the Shipping Deputy Minister.

For Cyprus, the first of those growth pillars remains the continued expansion of its ship management base, an area in which the country has long held a distinctive position within the European Union.

“The first is the continuing consolidation of Cyprus as the European Union’s leading third-party ship management centre. Fleet renewal programmes under way are being technically and commercially managed from here, and that work expands employment, expertise and supplier activity on the island,” she said.

But Cyprus is also looking well beyond traditional ship management. Shipping Deputy Minister Hadjimanolis stressed that the cluster is widening in depth and sophistication, with growth being recorded in a series of complementary maritime services that help reinforce the island’s credentials as a full-service hub.

“The second is the broadening of the cluster beyond traditional ship management. We are seeing measurable growth in maritime technology, bunker trading, chartering, classification, legal services, communication and insurance. Cyprus’s integration of ship-owning, ship management and chartering within a single tonnage tax framework remains unique within the EU and continues to attract companies that want the three activities under the regime,” she said.

Cruise is also becoming a more visible part of the Cyprus maritime story.

“The third is cruise tourism, where 2025 delivered an approximately 30% increase in ship arrivals, 139 confirmed calls at Limassol and 26 home-porting itineraries,” she added.

Already Limassol hosts more than 250 companies providing shipping services, continued Shipping Deputy Minister Hadjimanolis, and the areas now receiving particular attention are those most likely to shape the future competitiveness of the Cyprus luster.

“The growth areas we are paying particular attention apart from the registry and shipmanagement are maritime technology, communications and digitalisation, cruise operations and cruise-related infrastructure, and the continuing increase of supporting professions including legal, arbitration, insurance, accounting and compliance. The employment data illustrates the footprint: the sector provides approximately 9,000 onshore jobs, with more than 55,000 seafarers employed on Cyprus-flagged vessels,” she said.

Government strategy is closely tied to that wider ambition. Rather than pursuing growth for its own sake, Cyprus is placing emphasis on sustainable, higher-value development, particularly in areas linked to regulatory compliance, green transition and skills.

“Cyprus’ strategy is centred on sustainable and high-value growth. Key priorities include supporting the green transition of the shipping industry, deepening the maritime cluster by attracting a wider range of services, maintaining a stable and competitive regulatory framework, and investing in human capital.

“The government is focusing particularly on facilitating compliance with EU and IMO environmental regulations, enhancing the attractiveness of the tonnage tax system, and strengthening maritime education and skills.”

“Progress is broadly on track, especially in terms of regulatory alignment and cluster development. However, continued efforts are needed to accelerate innovation, digital transformation, and the attraction of specialised talent,” she added.

That focus on human capital is now being pushed at both national and European level. Cyprus has introduced measures aimed at seafarer education, retraining and upskilling, while also trying to improve the overall attractiveness of maritime careers, especially for young people and women. The issue has been given added prominence during the Cyprus Presidency of the Council of the European Union in the first half of 2026 and was expected to be formalised through the Lefkosia Declaration at the Informal Meeting of EU Ministers responsible for Maritime Affairs on 29 April. A high-level ministerial and stakeholders conference hosted on 28 April has also been dedicated to those priorities.

Environmental performance is another area where Cyprus believes it can combine policy and competitiveness. Since January 2024, shipowners of Cyprus and Community ships have been eligible for up to a 30% reduction in annual tonnage tax for each vessel demonstrating proactive environmental measures, a move intended to reward early action rather than simple compliance.

Cyprus also sees itself as having made solid progress in attracting shipowners and associated maritime services, including from Greece, while acknowledging that competition between maritime centres remains intense.

“Cyprus has been successful in maintaining and strengthening its position as a preferred jurisdiction for many Greek shipowners, who value its EU status, competitive tax framework, and strong shipmanagement ecosystem,” said the Shipping Deputy Minister.

“At the same time, there has been tangible progress in attracting and developing supporting services. Maritime firms have expanded their presence, arbitration and dispute resolution services are growing, and insurance and P&I representation is strengthening.”

Cyprus sees geopolitical developments as a challenge, but also as a moment in which its own strengths may become more visible. “Dubai has experienced significant growth as a maritime hub in recent years. However, regional tensions inevitably introduce a degree of uncertainty, which can influence investment decisions and increase operational and insurance costs. In this context, Cyprus is positioning itself as a stable and predictable EU-based alternative. The focus is on offering regulatory certainty, safety, and reliability, combined with proximity to key international shipping routes. As a result, we may see increased interest in European and Eastern Mediterranean hubs, where Cyprus is well placed to benefit,” the Deputy Minister added.

“Looking ahead, while short-term uncertainty is likely to persist due to geopolitical factors, the medium- to long-term outlook remains positive,” she concluded. “Global demand for shipping services continues to be resilient, and Cyprus’ strengths, stability, EU alignment, and a well-established maritime ecosystem, provide a solid foundation for continued growth and development. Cyprus is an EU flag of progress and quality and has a predictable regulatory framework, a full-service cluster and a government that works closely with the industry. The resilience of the sector that has navigated the industry before, will navigate the industry successfully once more.”