US Congress Approves Funding for Greek Shipyards

The US Congress approved last week a $125 million financing plan for the Greek shipyards at Elefsis, south of Athens in a major boost for the future of shipbuilding in Greece.

The US International Development Finance Corporation (DFC), America’s development bank, will provide the loan to ONEX company which owns the Elefsis shipyards.

The shipyards are attempting to be restructured through bankruptcy law after they couldn’t sustain themselves, falling 423.3 million euros ($462.16 million) into debt.

The history of the shipyard dates back to 1962, when its construction started and its operation commenced in October 1969. It is located in Elefsis Bay approximately 10 nautical miles from the anchorage of Piraeus, Greece’s biggest port.

It covers an area of 250 thousand square meters offering construction, repair and modification facilities.

Greece remains the top shipping nation in the world, as Greek shipowners with 5,514 ships currently control approximately 21 percent of the global fleet, in terms of capacity, the Union of Greek Shipowners (USG) recently announced.

While Greek shipping tycoons rule the world’s waves, shipbuilding in the country lagged for years, with ships being bought elsewhere to build the fleet, seeing Elefsis fall into decline.

Funding will upgrade Greek shipyards

The funding, which was approved by Congress, will be used to restore and upgrade the shipyards, increasing the service capacity to up to 200 ships per year and getting Greece back into the sector.

When fully operational, ONEX Elefsis Shipyards, owned by businessman Panos Xenokostas, plans to become the largest shipyard in the country that will serve the Greek Navy and commercial fleets.

In another major development last week, ONEX announced an agreement for the expansion of cooperation with Italian shipbuilding company Fincantieri which is the largest shipbuilder in Europe.

According to a statement by ONEX the agreement provides significant competitive advantages and benefits to the Greek shipbuilding and defense industries, as well as the Hellenic Navy.

The new partnership includes a new world-class ship production line, including the construction of corvettes, and advanced surface ships, especially frigates.

“It offers the HN modern, cross-functional, and high-tech solutions to significantly upgrade its operational capabilities in the Eastern Mediterranean,” the statement said.

Already Onex, have signed a memorandum for the production and maintenance of two corvettes, with an option for a third.

The project is expected to open 2,500 new jobs in the shipbuilding sector. A collaboration with multiplier-effect benefits for the Greek economy and defense will be launched.

“We are utilizing a unique feature of the Italian defense industry, where a network of small and medium-sized companies collaborates with global ones: this is exactly what we want to apply in Greece to make Elefsis Shipyards a point of reference,” Fincantieri CEO Pierroberto Folgiero commented.