The Covid-19 crisis has led to a rapid advance of technology in shipping, Deputy Minister for Shipping Vasilis Demetriades told a virtual conference for shipping, while economists and shipping experts have stressed that there are silver linings amid the coronavirus pandemic.
“The Covid-19 crisis has severely impacted the shipping industry and its operations, but unexpectedly resulted to the rapid advancement of technology,” Demetriades told the 2020 Marine Money Virtual Cyprus Ship Finance Forum, held virtually on Wednesday.
In his welcoming remarks Demetriades said the future is digital and over the last two months we have fast-forwarded 5 to perhaps even10 years in the evolution of how we work, noting that advanced resource optimization systems, automated cargo handling equipment and efficient information sharing between all actors will all help cut costs.
“There is no doubt that COVID-19 pandemic is a catalyst for change. Adjusting to the “new normal” is not a cliché,” he stressed.
As Demetriades said, amid the physical distancing rules, digital tools and solutions are more important than ever.
“In this respect, the Shipping Deputy Ministry of Cyprus is working towards the development of a digital port state control platform and is exploring the possibility of remote audits,” he said, adding that another solution that came to the surface and has been widely applauded by the shipping industry is the digital certificates.
“Cyprus has made significant progress to simplify formalities and to transform our services to a paperless environment that will increase efficiency and attractiveness of the Cyprus Registry and its relevant services,” Demetriades said, adding that the Shipping Deputy Ministry is in the process of formulating a road map of actions that will turn all our services digital creating the framework conditions for a one-stop-shop.
With regard to alleviating the effects of the pandemic to the Cyprus shipping sector, Demetriades said the Deputy Ministry is evaluating all the available options and through the European Recovery and Resilience Facility (ERRF) and is examining ways to assist the sector to recover from the drastic downturn in passenger numbers and freight movements.
Stressing that the ERRF is strongly linked with the transition towards a “green and digital Europe”, the Deputy Minister said on that basis we are exploring ways to support the industry in the deployment and use of sustainable vessels, alternative fuels and the digital transformation of the shipping sector.
“In search of bright days for shipping, it is clear that we have to rethink the way the sector operates. In this journey, there is a need for an ambitious vision and for clear objectives,” he said, adding for this reason the Shipping Deputy Ministry is working towards the formulation of a long-term strategy for Cyprus shipping.
“We will soon bring the Cyprus shipping community fully ‘onboard’. We are building a vision for Cyprus shipping and we must do it together,” Demetriades concluded.
On his part, Andreas Assiotis, Chief Economist of Hellenic Bank said that following the shock caused by the Covid-19 pandemic, the release in demand particularly in durable goods, has led the recovery. This demand, he explained has been contained due to horizontal lock downs implemented as part of efforts to limit the spread of the pandemic.
He noted governments released huge package of support measures, at the backdrop of a an accommodative monetary environment by Central Banks, while interest rates are expected to remain very low for a large period of time.
“Once we sufficiently control the virus, we will be left with an ongoing economic rebound and low interest rates,” he said.
For Europe, Assiotis said a silver lining comes from the EU’s €750-billion Recovery and Resilience Fund, which would assist member states to promote reforms targeting sustainable and inclusive growth.
“Obviously the Commission has not issued a blank cheque to the member-states, we are talking about action plan that need to be put in place and these action plans need to abide to the EU priorities,” he said, noting that “this is a great chance for member-states to proceed with all these reforms that are needed again in a relatively unconstrained way”.
Concluding, Assiotis said although this pandemic is “far from over,” “we know much more than we knew in February and March, and healthcare systems, especially of the western world, are much more prepared to tackle the pandemic.
Tim Power, Managing Director and Head of Maritime Advisers of Drewry Shipping Consultants Ltd, said that shipping especially the sector of general cargo has been much more resilient amid the Covid-19 crisis, compared with the 2008 global financial crisis.
As he added, the container sector is expected to shrink by 3.3% compared with a 10% downturn during the financial crisis. “The 3.3% contraction is a big surprise,” he said, adding that “all seem to be much more resilient.”
Power stressed the shipping sector is more resilient as there is no excess supply of ships compared to the 2008 crisis.