"I expect 2026 to be a mixed but overall positive year for shipping — especially for the dry bulk sector. The industry will still face volatility from geopolitics, decarbonisation costs, and crew shortages, but dry bulk looks relatively strong compared to other segments," Sunil Kapoor, the COO & Partner of OL Shipping Group reveals.
In an interview with CBN as part of the IN Business Forecasting 2026 series, Kapoor also notes that while he believes the Cypriot economy is entering the new year from a good position, "several long-standing issues still need urgent attention."
As the expert continues, "Many of these have remained unchanged since I moved to Cyprus 18 years ago. The delay in Schengen entry, high energy costs, water scarcity, recurring forest fires, the Turkish embargo on Cyprus-flag vessels, weak connectivity to Europe, and inefficiencies in public administration all continue to limit competitiveness. These issues are discussed every day, but what is often missing is consistent intent and execution."
Among other things, Kapoor elaborates on his expectations for the shipping sector in 2026, how the merger and acquasition trend may impact the industry and why, for OL Shipping Group, "2026 is about focused and disciplined growth."
How do you foresee the development of the Cypriot economy in the new year, and what are its prospects? What do you see as the biggest risks, and how might they be addressed?
The Cypriot economy enters the new year from a good position. I believe Cyprus has finally moved past the shadows of the financial crisis and the passport scandal. Recent high-level visits — including Prime Minister Modi’s — have brought positive visibility and confidence.
However, several long-standing issues still need urgent attention. Many of these have remained unchanged since I moved to Cyprus 18 years ago. The delay in Schengen entry, high energy costs, water scarcity, recurring forest fires, the Turkish embargo on Cyprus-flag vessels, weak connectivity to Europe, and inefficiencies in public administration all continue to limit competitiveness. These issues are discussed every day, but what is often missing is consistent intent and execution.
Cyprus has strong fundamentals, but to reach its full potential, we need better infrastructure, a more modern state system, proper environmental preparedness, and clear timelines for reforms. If these steps are taken seriously, 2026 can be a positive year.
How do you expect your company’s sector in particular to perform in 2026? What major trends or changes do you anticipate, and what do you consider the most significant challenges?
I expect 2026 to be a mixed but overall positive year for shipping — especially for the dry bulk sector. The industry will still face volatility from geopolitics, decarbonisation costs, and crew shortages, but dry bulk looks relatively strong compared to other segments.
Cargo demand should grow modestly, while fleet growth remains very low. Stronger minor bulk movements, longer voyage routes, and rerouting around conflict zones will all support freight rates. There is also potential upside if progress is made in Ukraine or the wider region, as reconstruction will create heavy demand for materials.
The IMO decision to delay its Net-Zero Framework by one year is a temporary pause, but it does not change the overall direction. Emissions and ESG expectations will continue to rise. Companies that stay ahead of the transition will be in a stronger position with financiers and charterers. My bigger concern is that local governments may introduce their own taxes, which could complicate things further.
Overall, I remain cautiously optimistic. Dry bulk is well-positioned for 2026, with limited downside and meaningful upside if geopolitics stabilise.
A strong trend taking root in the Cypriot business landscape is mergers and acquisitions. Do you expect this trend to become more pronounced in your sector as well?
I expect to see more alliances, partnerships, and joint ventures, but not a major wave of mergers. Cyprus will consolidate slowly, selectively, and always in a way that respects the culture of its shipping community.
Cyprus is a very different shipping circle compared to Greece, Hong Kong, or Norway. Most companies here are family-run ship managers or owners who prefer to keep everything in-house. Shipping in Cyprus is not only a business — it is a way of life built on trust, personal relationships, and loyal teams.
Because of this, mergers in Cyprus are difficult. Past attempts that did not work well still influence thinking, and in a small community those stories travel fast. Owners value independence and prefer to grow on their own terms.
I do expect more alliances, partnerships, and joint ventures — but not a wave of big mergers. Consolidation in Cyprus will happen slowly and selectively, and always in ways that respect the culture of the shipping community.
What should we expect from your organisation’s plans and strategy for growth and expansion in 2026? What specific actions do you intend to take to support this direction?
For our organisation, 2026 is about focused and disciplined growth. We will continue to expand in the dry bulk sector, especially in the Handy size space, where we see stable long-term demand. But our approach is measured — we do not want to grow just for the sake of growing.
As I’ve said before, we do not want to become the ‘Coca-Cola of shipping’. Our aim is to build a boutique shipping company known for quality, transparency, and consistent performance. Every vessel we add must genuinely strengthen our platform. Growth will come, but on our own terms and with resilience in mind.”
The new year sees the implementation of tax reform, taking place 22 years after the previous tax reform. How do you expect it to affect the Cypriot economy, businesses, and Cyprus’ ability to attract foreign investment?
Any reform that simplifies the system and improves the lives of ordinary people is welcome. The 2026 tax reform is an important step. Modernising a framework after 22 years can improve clarity, transparency, and administrative efficiency — all positive changes.
But I also look at this realistically. Investors today consider far more than tax benefits. They look at infrastructure, talent availability, digital services, environmental readiness, and the overall ease of doing business. Tax reform alone cannot solve deeper structural issues.
Some parts of the reform will help employees and simplify processes, but to truly attract long-term investors Cyprus must combine tax reform with real improvements in competitiveness and service quality. It is a good step — but it needs to be part of a much broader effort.
