Irish-based Shipping Companies Announce Billion Euro Expansion Plans
The Minister State for Transport, Mr. Noel Ahern, TD, today (1st August) welcomed news from the Irish Maritime Development Office (IMDO) of expansion plans totalling over €1 billion by seven Irish-based shipping groups. In the first six months of 2008, 21 new and second hand vessels have already been acquired, with a further 27 vessels confirmed or expected to be delivered over the next two years, most of which will be newly built.
The IMDO are confident that the latest wave of expansion plans by the Irish shipping industry are not only expected to sustain the existing onshore employment of some 300 people but also create further new jobs in office-based commercial and technical services in Ireland.
This investment boost is also likely to create prospects for new jobs in the support services that make up the emerging Irish maritime finance and commerce cluster. Several Irish-based banks, ship managers and brokers are involved in structuring, financing and operating these latest deals.
Commenting on the announcement, Minister Ahern said: “ At a time when we hear so many negative comments on the economy, this investment is extremely welcome and shows the confidence of these investors that the underlying indicators for the world economy into the future are positive.”
The single largest investment of some $700 million is by D’Amico Ireland – a Dublin-based company that will be undertaking a building programme of 14 new vessels in Chinese and Korean shipyards. The company, which is listed on the Italian Stock Exchange, is relocating to new offices on Sir John Rogerson’s Quay to accommodate its Irish expansion plans. In 2008, D’Amico also announced an joint Irish-based venture with Glencore, “Glenda International” which has resulted in a commitment by both groups to build 10 new medium range parcel tankers.
Paolo d’Amico, Chairman of d’Amico International Shipping S.A. commented: The latest expansion plans announced represents a further step by the company to expand its owned fleet and that we are confident that this continued investment and expansion will enable us to sustain our long term plans to also develop our Irish operations”
Global shipping markets are at an all time high principally driven by demand from China, India and Asian sub continent economies for raw materials, grain and energy products. The sector is also most dependent on global GDP which grew by 5% in 2007 resulting in a 7% increase in seaborne trade demand.
The Minister of State was further encouraged by the number of Irish indigenous companies, such as Seabess, Mainport Group and Arklow Shipping Ltd. that were involved in increasing their operations, particularly in the International bulk transport and energy markets. He continued: “While economic conditions in Ireland are certainly going to be tougher in the coming year, this is clearly not a factor constraining those Irish companies that continue to compete successfully in the global market place.”
Arklow Shipping Ltd. recently announced it will build a further four vessels at the Astilleros Murueta shipyard in Spain at a cost of around $54m. This will bring to ten the number of vessels it has recently taken delivery of from this yard. Arklow operates a fleet of 35 ships of 3,000 dwt to 13,000 dwt. It plans to use the mini-bulkers to carry grain, fertiliser, coal and minerals, mainly within north-western Europe.
Capt Dave Hopkins, President of the Irish Chamber of Shipping and also Marine Director with Cork based Company Mainport, welcomed the latest developments and commented that “In the past 5 years our company have gone from owning and operating 6 vessels to more than 30, including 7 recent acquisitions. Irish based ship owners are demonstrating given the right conditions that Irish companies can compete in tough and highly challenging global markets”
A further 12 companies are currently seeking to establish strategic commercial ship owning and management operations in Ireland in 2008, with several others also exploring potential investment opportunities. The IMDO are optimistic that further new investment will follow, creating additional employment opportunities both on shore and at sea for Irish maritime professionals.
IMDO Director, Glenn Murphy commented “The Irish Government have created the commercial and financial conditions that have fostered an environment where both foreign and Irish companies can now expand and develop their business.”
Ireland has already managed to establish itself amongst the top 15 international ship finance centres and gain admittance to the prestigious "White List" of top performing shipping states in the world earlier this year. Obtaining 'White List' status from the Paris Memorandum of Understanding is an international recognition that Ireland operates a quality shipping register. Now ships operating under the Irish flag should see reductions in routine inspections, saving operators time and money. All of the current Owners announcing the last expansion are registered with white list flags.