On December 15, Secretary-General Zhen Hong and Deputy Secretary-General Zhang Jieshu, as well as experts from Shipping Market Analysis Department of Shanghai International Shipping Institute (SISI) were interviewed by Wen Wei Po about the current development of the shipping market and the approaches to lifting the shipping industry out of recession.

It was reported that the year 2011 witnessed the recession for shipping market, featuring low freight rates, high costs, default charges and deferred rental among shipping enterprises. Many have been struggling for a whole year just to break even, or strive for fewer losses.

As for the future development of shipping market, Mr. Zhen Hong held that the current predicament of shipping industry is a product of overcapacity, soaring operating costs and global economic environment, and is hard to be shaken off in the immediate future.

How to “survive the winter”? Mr. Zhen Hong proposed that the first step for shipping enterprises is to strengthen internal management and reduce operating costs. There are rooms for larger shipping companies to cut down unnecessary costs by, e.g. reducing administrative costs and travel expenses. Secondly, in view of the general overcapacity, shipping enterprises shall pay attention to “capacity control” to avoid blind deployment. Finally, in the face of the fierce competition brought by Maersk, China’s shipping enterprises are suggested to form alliances for mutual support or diversify their business by investing in promising terminal industry and port enterprises. Moreover, they can adopt business differentiation by, e.g. specializing in the transport of refrigerated and special containers. All these are practicable ways out for the shipping industry.

In addition, Deputy Director Zhang Yongfeng and Researcher Zhong Xiaoyan of SISI Shipping Market Analysis Department made in-depth exchanges and discussions on the development of international shipping market in 2011 and 2012.