Diversification 'key to maritime survival'
Dubai, November 27, 2012
Diversification and risk management are key to survival for companies in the maritime industry in the current challenging environment, a senior official said.
Speaking at the opening plenary session of Seatrade Middle East Maritime in Dubai today (November 27), Sheikh Daij bin Salman Al Khalifa, chairman of Asry, said: “The challenges our industry faces are a matter of concern especially here in the GCC, as we are net importers.
“Unfortunately, changes never come alone they come in groups, especially in the maritime sector. Stagnating volumes, rising fuel prices, declining asset prices, piracy and insurance are challenges, but they’re cyclical,” he said.
Sheikh Daij saw growth in the Ultra Large Vessels sector. “Super vessels are being ordered to take advantage of the economies of scale. Everyone is ordering vessels above 10,000 TEU.
“This is a reflection of the optimism in the industry that we will see another upturn soon – but maybe not in 2013,” he said.
“We must change and evolve as the business environment changes around us. We must take calculated risks to protect ourselves; we must have the bravery to expand and diversify,” said Sheikh Daij.
“Diversification should be a natural evolution; but it should also provide benefits to the core business stream. Asry is subject to the same downturns faced by the shipping industry, but since we have diversified, our new oil and gas division is now earning as much revenue as our core business,” he added.
Chris Hayman, chairman of Seatrade, said there is a definite move towards ultra large vessels.
Hayman said: “While the recently commissioned Marco Polo, at 16,000 TEU is the largest vessel in the world, next year, Maersk will surpass this with its 18,000 TEU capacity vessel. Maersk’s business also underlines the shifting global economic focus, after it has seen a 15 per cent increase in business from emerging markets.”
Jamal Majid Bin Thaniah, vice chairman, DP World & Group CEO, Port & Free Zone World, Dubai, said he saw a “new wave of globalisation” and a totally different world since 2008.
“After a sustained period of growth of around 12-15 per cent per annum – a boom rate until 2008 - we are now seeing growth rates in the industry of 2-3 per cent, which will continue for two reasons – low tariffs and global trade barriers,” he said.
“There is also a shift in the centre of gravity – we are seeing a shift in economic power from West to East,” he said.
He said the industry needs to “move away from the regionalised global system and work together to remove the global trade barriers.”
Held under the patronage of Sheikh Mohammad bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, the three-day exhibition and conference will run until November 29. – TradeArabia News Service