In an exclusive interview with Akti Miaouli newspaper, Greek ship owner and Intertanko president, Nikos Tsakos discusses the future of Greek shipping and latest developments affecting the industry.
Q: What is the standing of Greek shipping in these difficult times?
Shipping has managed to survive centuries in uncertainty. It is the most economical and environmentally sound way to carry huge cargoes. What concerns us are the messages not allowing trade to move, due to political motives and reasons. Shipping survives in an open world and we believe that ultimately what is being said for the election of Donald Trump in the US, for example, concerns raised will be groundless and insubstantial.
Q: So, you don’t see the election of Trump affecting the global economy?
It is still very early to see. However, charter rates – that are usually a good way to predict the future – appear to have reacted positively. There was some nervousness in the first few weeks but now the market is starting to “accept” that we will live with the Trump mentality.
Q: Regarding the energy sector, what developments do you expect?
Energy is currently about 50% from its high. This has helped us as tanker owners to do better because the cheaper the product we carry is, the greater the demand for it.
We believe that shipping, where Greek involvement is the largest – we own 25% of the global tanker fleet – could continue to do well until $75-80. When we exceed this psychological limit people begin to hold back, to make cuts and there is less demand to transport oil.
Q: How are Greek owners dealing with the market situation?
Greek shipping has always come out of crises stronger. I believe it will do so this time too. From the crises in the 80s and 90s and the current one, which is long since it began in 2008, we see that Greek shipping, the neat family business, can “pull through”.
In order to have two more generations of Greek shipping we need Greek seafarers. What happened to countries that were powerful in the shipping business, like England and Norway, was that they lost their seafarers and vanished after one or two generations as great powers in seaborne trade.
Norway, that was Greece’s biggest “competitor”, represents less than 6-7% of global shipping today. This is a danger and we Greeks must embrace Greek seafarers because it is the Greek seafarer that becomes a captain or mechanic that may become the next ship owner.
Q: There is a big problem in shipping finance for a long time. What is your view?
One could see this problem in a positive light. With the lack of finance, the many newbuilding orders will stop, especially without the guarantee of charters. This means extra tonnage will not enter the market. Therefore, for us it is currently very good that shipbuilding is limited.
Q: What will happen with vessels that have already been ordered? Orders are plenty and shipyards in Asia are collapsing.
We hope that many of these yards, especially in China, will close for good, the workforce will do something else and the rest of the vessels will necessarily be absorbed. They will of course keep the market low for one or two years and we will see a better market afterwards if there are no new orders.
Q: Do you believe scrapping younger vessels is a solution?
We saw 10-year-old containerships – which of course we are not active in – being scrapped.
Q: What is your view on the taxation of Greek ship owners the European Union is pushing through Commissioner Vestager?
There is a war against Greek shipping. I believe that the Greek government is staunchly supporting Greek shippers because the Greek owner is a lone person. He employees thousands on land and at sea, therefore I believe the government is rightly resisting. The European Union is trying to take Greece’s lead in shipping away…
Q: Germans first and foremost…
The EU we should say; let’s not focus anywhere in particular. This is like, for example, trying to strip the French wine making industry of its privileges, or those of German car makers. I believe we will finally overcome it.
Q: What new situation does BREXIT create for Greek shipping?
Definitely. I am president of INTERTANKO. We are based in London and we came here 15 years ago because Britain was a European country. Other organizations are currently experiencing some uncertainty too. But this does create an opportunity for Greece to gather all those feeling insecure because Greece is the center of shipping at the moment, it has the global lead in the industry.