The 2nd Annual Capital Link Cyprus Shipping Forum: A Vote of Confidence in Cyprus’s rising role in World Shipping; Dr. Loukas Gr. Glyptis writes on the afternoon sessions:
The annual Capital Link Cyprus Shipping Forum is now firmly established and according to its participants, its organization in Cyprus for a second consecutive year is another testament of the increasing interest that international shipping stakeholders have in the role that Cyprus can play in world shipping today. The Forum took place on 14th February, 2018 at the state-of-the art premises of Columbia Ship Management in the city of Limassol, and it was surely another great success.
The Forum comprised sessions where major shipping stakeholders, including ship owners, ship management companies, banks, insurance companies, state representatives from the Republic of Cyprus, including Mr Marios Demetriades, the minister of Transport, Communications and Works, shared their views on the current state and prospects of world shipping and the role of Cyprus thereto. Participation to the Forum was high and the full assembly until the Forum’s very end was evidence of the high interest on the issues raised. Sessions were centered on the state of the global shipping markets, the opportunities, developments and challenges faced in ship management (including technical matters, crew management and development, cyber-security issues, regulatory developments on the prevention of corruption, trends in insurance), as well as geopolitics, shipping finance, and an overview of the aforementioned issues approached from the ship owners’ perspective.
The key message of the Forum was that world shipping currently finds itself in cross-roads where the major opportunities and challenges presented by a better balance between supply and demand of carrying capacity, combined with slowly-recovering global growth, fast technological development, new regulations affecting vessels’ speed (e.g. sulfur regulations) and limitations to access to external finance, need to be carefully reviewed. The prediction regarding the bulk carriers freight market is that it is likely to offer improved freight rates, but analysts and ship-owners remain cautious as to whether this will ultimately materialize. The dominant question from speakers and audience was: Can we now safely state that world shipping is into its recovery phase? Nobody can say with certainty, and as Polis Hajioannou, CEO of Safe Bulkers said: “Whenever we predict that the market will behave in a particular way, this does not happen”, suggesting that ship-owners’ ordering decisions to maximize returns from a promising market, lead it to behave differently, eventually. Mr. George A. Tsavliris, President of the Tsavliris Salvage Group: “One needs to resort to gut-feeling and be romantic to do well in this uncertain sector”. A related and vigorously raised factor by many speakers and certainly the ship-owners who constituted the summing up panel of the Forum, i.e. Captain Panayiotis N. Tsakos of Tsakos Group, Mr Andreas Hajiyiannis, President of Cyprus Sea Lines, Mr Polys Hajioannou, CEO of Safe Bulkers, and Mr Aristeides Pittas, Chairman and CEO of Euroseas Ltd, and Mrs Nicole Mylona, Transmed Shipping Co. was the fact that the large volume of orders for new buildings of the previous years are probably going to act as a self-restraining mechanism that will prevent new orders and excess capacity, which can keep rates on the low side. Greediness they argued is a key behavioural parameter that pushes freight rates down again, as soon as ship-owners start placing more orders for new-buildings; self-restraint should prevail they argued. Relatedly, Capt. Panayiotis N. Tsakos observed that he is not a buyer currently, even though the purchase cost of vessels is significantly low and he predicted that they will end up competing to buy vessels in ‘bargain’ prices of $70+ million in a few years from now.