Imperative need to link shipping with the social fiber


The “rule” that a big rise is followed by a correction and crisis has been confirmed once again. In the case of shipping, the excessive rise in the charter market in recent years was followed by a dizzying decline.

Everyone involved in this branch have ‘tasted’ the traditional cyclicality of the charter market and, in that sense, the crisis that is currently plaguing shipping should not have taken them by surprise. However, the intensity with which shipping was hit, due also to the global financial crisis, appears to have surprised even the most experienced. Others visibly and others inwardly, giddy from the uncontrolled course of the charter market and the affluence of the past years, believed that the upward course would continue for a long time.

The surprise suffered by the shipping world by the magnitude of the crisis, and also the ways of managing the present situation, were referred to by three of the biggest Greek shipowners, Captain Ioannis E. Karastamatis (Eletson), Pericles Panagopoulos (Magna Carriers) and Captain Panagiotis Tsakos (founder of Tsakos Group of Companies) during a day event at the University of Piraeus.

Also highlighted at the event were the new challenges faced by Greek shipping, while the need was stressed to further link shipping with the social fiber, but also the threat of its losing its Greek identity was underlined.

Need for creating professionals

Throughout his long involvement in shipping affairs, Cpt Ioannis E. Karastamatis has seen shipping face many crises. He notes, however, that the present crisis is much larger, due to the many newbuildings, the large number of orders on the books, but also the lack of withdrawal of older ships. As he stressed, the crisis will be a very tough one because the obligations that have been undertaken by the offices are immense with respect to newbuildings, the ships are working without even earning their crew expenses, while the values of the ships have fallen significantly.

Noting that a lot of money was concentrated in the years that passed, Mr. Karastamatis placed particular importance to ‘where the money went, where it was placed”. He believes that: “If the money, the cash, is in the banks, the crisis can be overcome. If, however, the money has been placed in other investments, it has been lost or, if it hasn’t been entirely lost, a very large part of it has.”

Focusing on the fact that “the ships are moving, and to date we do not have tied up ships”, Mr. Karastamatis noted that “without having a high market, this does not mean, nowever, that transports are not being carried out”. He feels, however, that “what is lacking from the market is that x percent that will bring about balance,” which, as he hopes, “will start coming as of the summer and autumn”.

He appeared quite worried about the fact that the crisis coincides with “an era in which the people, the children, had started to have confidence in the sea and to want to come to the sea”, stressing that “sooner, or later, shipping will need them”.

It is Mr. Karastamatis’ conviction that “the family shipping companies will not be able to be maintained for long. Consequently, we must create professionals in the shipping companies, people who will work in the companies”. In that framework, he underlined the importance of industriousness, which is what “creates the momentum, which will do that ‘little bit more’.”

Quality a component of success

With the words of a wise man that “if you love your work, you will never work”, Mr. Pericles Panagopoulos explaind the importance of industriousness, not only for a person’s successful course, but also for his mental balance.

Adding at the same time another important element, that of quality, which he was taught by the great Eugenides, Mr. Panagopoulos presented a different dimension.

Referring to the crisis being faced by shipping, Mr. Panagopoulos clearly descrived the up to recently prevailing atmosphere of excessive optimism. As he noted, the shipping world manifested “great faith in the high profitability, to the fact that everything was going up and nothing was declining, disregarding the adage that ‘what goes up must come down’.

Even with his own great experience, and while he was expecting the appearance of the crisis and, in fact, six months before it actually broke out, he nevertheless, as he confided to us, bought expensive ships, and had his own losses.

But given that in a professional career successes co-exist with failures, what was important for satisfactory performance in times of crisis is “how we will confront the crises”. Wishing to convey his own experience to the audience and at the same time give food for thought for reaching conclusions, Mr. Panagopoulos referred to his own professional course, and also his change from one professional cycle to another, which he did at the right time. As he stressed, of decisive importance is not only the right choice one makes in his career, but also his change of direction when the needs demand it.

At the same time, he urged the young people to have confidence in what they have chosen to occupy themselves with and to support it by giving their best self.

Shipping wealth is not class-oriented

“We should not have been taken by surprise with the crisis that broke out, but we were. After 5-6 years of such affluence, which we hade not seen in all the years in our line of work, we should have expected it and be did expect it, but not with such an intensity, not so painfully, so suddenly,” Captain Panagiotis Tsakos said.

Focusing on the role that the University of Piraeus could play in Greek shipping, he stressed the need to link shipping with the port and what goes on there, and also with the work places, such as the offices and on the ships, stating the full support of the people of shipping in that direction.

Captain Panagiotis Tsakors expressed hope that there will be greater social consensus and acceptance of shipping, the seafarers and the seamen, in the Greek society, stressing that seafaring is a national asset, together with our cultural and national heritage.

As he stressed, “it is a shame that shipping is isolated by the Greek society with the argument that it belongs only to the shipowners. It does not gelong to the shipowners. Besides, the shipping wealth is not a class-oriented wealth. It is a wealth is concentrated in this corner of the world from all the seas and from every part of the world”.

He noted that money entering the country from shipping was estimated at 18 billion euros, similar to that which comes in from tourism, and explained that for every incoming tourist dollar at least 50 cents have already been spent on infrastructure projects and imported supplies, whereas conversely, “foreign exchange coming from shipping is clear and solid”.

According to Mr. Tsakos, in order for this link with the national economy to exist and yield, two conditions are necessary. The first concerns the existence of a sufficient number of Greek officers in order to meet the staffing needs of the Greek and Greek-owned ships. The second concerns the creation of the institutional and material-technical infrastructure based on modern models of organization and operation.

Sounding the warning bell, he noted that “so long as Greek officers, staff are not coming to the ships, the management of the ships will no longer be able to be conducted from Piraeus, from Greece”. He added that “when they leave Greece, when the ships leave the hands of the Greeks, we will be left with nothing. We have not created the infrastructures that will be able to maintain at least some of the operations, the shipping-related services”.

Calling for a “crusade to attract the young people to the sea”, Mr. Tsakos noted the misinterpretation and disdain of the seafaring profession, and accused the Mass Meadia for the picture they create in instances of maritime pollution due to shipping accidents. It was unallowable that they defame the country’s biggest product, the most robust, the best, the first maritime in the world, unfairly, he said.

He called on everyone to avoid the introversion, defamation, disdain, the social isolation of shipping and asked them to embrace the sea “with all its hardships and difficulties, but also its beauties and greatness”.

Mr. Tsakos proposed that the doors of the Greek universities, the ministries, the state machine open up to the worthy people of the sea – in the form of a visiting professor or consultants (unpaid) – given that the magnitude of the experience and degree of adaptation some of them have was exceptional.

Noting that Greece cannot become great once again if it does not remain linked to its unique shipping tradition, Mr. Tsakos stressed that “only in this way will shipping be able to be linked with our national fiber in order to bring our economy and our other national performances to our own sizes and heights”.

cover story economic outlook May 2009

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