GSCC Chairman H. Fafalios - New Year's Speech
This is the second time in history that I am delivering my January address online due to the COVID-19 pandemic but I hope and pray that we will soon return to our old normality.
During the year that passed, the world shipping industry has valiantly and successfully managed to perform its task of moving the worlds bulk and unitized cargoes from A to B, and of anticipating smoothly the increased demand for all cargoes.
We are also trying to pre-empt the ambitious targets of COP 26 and prepare shipping for an even lower carbon world than that which already exists.
It must not be forgotten that world shipping has been swiftly and silently decarbonizing for the last 70 years successfully, finding technological solutions in order to reduce the carrying cost and decrease the carbon footprint of each ton of cargo. No other industry globally has had such a successful result and done so in such a cost-effective manner.
The over-riding conclusion of COP 26 was governments salivating at the revenues they would collect from an assortment of green levies, but not a word was mentioned about coming up with any technological solutions whatsoever, or indeed guaranteeing the worldwide availability of safe, sustainable, low or zero carbon fuels.
Should such levies take place, it is imperative that charterers shoulder the burden as they alone define the voyage of every ship vis-a-vis size of cargo, itinerary and transport speed and it is encouraging to note that the EU is making noises in that direction.
Ιn our industry various organizations and companies are touting their green credentials with the choice of fuels that will power their newbuildings. However, none of them are really carbon free and they just kick the can down the road.
LNG is an interim fuel but still carbon intensive. Green or e-methanol is currently unavailable worldwide in the quantities our industry needs. Ammonia is quite dangerous to the crew if not properly contained. Combustion of ammonia in an internal combustion engine also produces nitrogen compounds far more pollutant than CO2! The major issue with all these is the significant amount of pilot fossil fuel required for their combustion. Yet again, both engine and ship builders are only just now starting to address any technical solutions. These are still at an embryonic stage.
No real effort has been made to invest the revenue derived from any carbon taxes into a Research and Development fund for the maritime sector. Such a R&D centre should be created and based in Greece, which is the global centre of the maritime industry.
Whilst the E.U. has been trying to hijack the debate on green taxes, cut off dates and other maritime issues, one should caution them that only the I.M.O. itself has the knowledge and experience to come up with global, short, medium and long-term solutions.
Criticizing the I.M.O. is the most counterproductive way to move forward. Seasoned debate and well thought out practical and detailed solutions for every sector in shipping are the only way to a carbon free future.
Looking at the world economic situation one sees that inflation yet again is rearing its head prominently.
Governments, in an effort to counteract the global pandemic, have pumped huge amounts of money into their economies in order to breathe life into them.
The U.S.A. is in a full employment mode and a roaring stock market but with an anti-fossil fuel agenda. The U.K. has still not decided whether it wants to become a great trading nation or not, post Brexit.
The E.U. has still too many lame duck economies and not enough pro-business governments to move forward.
The Far East, and China in particular is still steaming head in order to reach a fully developed world status. Whether hiccups like Evergrande slow them is another matter.
The dry bulk market started last year acceptably and continued to improve significantly until the end of the year when it started to subside.
Yet again, volatility is more important than the fundamentals and over the last year FFA volumes have broken all records. The tanker market has spent the last year in the doldrums and seems to not yet have been positively affected by the rise in global economic activity.
The container market has stood out over the last 12 months as the most bullish shipping sector, with freight rates achieved being at historic highs. Whilst this year has started positively, one must not forget the colossal order book which have been racked up and whether it will soon come to affect this sector.
The LNG/LPG sectors had some spectacular moments, especially the LNG carriers. However, this has dissipated but may return due to political instabilities regarding some of the pipelines that supply gas from Russia to the west.
The main issue of the year was and is all our crew members at sea and the superintendents that have to travel around the world visiting ships. The repatriation and vaccination issue is as difficult as ever and many countries, especially in Asia, are not helping to facilitate this issue.
This in turn has naturally brought about many physical and mental health issues as crews do not have the ability to embark or disembark from ships when they need to.
The G.S.C.C. has always considered the human element of our industry as paramount and will continue to lobby governments and the I.M.O. to show greater consideration for seafarers and facilitate crew travel and vaccination to a much greater degree.
In Greece we urge the government to improve the maritime education system through concentrated investment and private sector involvement. It must also be stressed that the Greek flag itself, although broadly competitive at first glance, needs a significant reduction in bureaucracy if it is ever to flourish again.
From an international perspective, we continue to stress the need for longer serving individuals at both the I.M.O. and the E.U.
It remains disappointing that Greece does not have a more prominent voice in E.U. maritime affairs, considering that it represents over 50 per cent of the E.U. fleet.
The Hellenic Coast Guard is still a very important part of the Greek shipping system and must continue to remain so in Greece and abroad.
On a sadder note, I would like to mention the sad passing away of our most prominent Council Member, John A. Angelicoussis. Over the course of his life, he created Greece's largest shipping company with a fleet of newbuilding tankers, bulk carriers and LNG carriers with the large majority flying the Greek flag. His belief in Greek personnel at sea and ashore was unique as was his love for his country. He will be greatly missed by those who were fortunate enough to know him.
We cannot overstress the gratitude that is felt towards all our people onboard and ashore for their magnificent efforts at keeping world trade flowing smoothly and silently with so little disruption in such an uncertain global environment.
Finally, I would like to thank all of my G.S.C.C. colleagues for their dedication and hard work and in particular to Kostas Amarantidis and Maria Syllignaki for running this organization so smoothly in these challenging times.