Weathering the financial crisis

In 10 years MSC has almost doubled the volume of freight it used to carry and the growth will continue, predicts Captain Salvatore Sarno, chairman of Mediterranean Shipping Company (MSC) South Africa. Despite the recent financial crisis, the industry has experienced growth in the past 10 years as demand from a growing middle class in South Africa has grown. “We live in a world of consumable goods and the demand for these goods cannot be compared to the demand from 30 years ago. We’re there to distribute and carry these goods that have today become part of a normal way of life, a necessity.” And while the demand for these raw materials and finished goods remains, the growth will continue, says Sarno, who believes that the industry could experience another intermediate crisis in the next two to three years, but not to the extent seen in 2008. According to Sarno, the financial crisis that hit the industry from September 2008 and in 2009 was almost as bad as that experienced in 1982. “I remember at the time we had only 24 vessels and didn’t have enough money to cross the Suez canal. In 2008 and 2009 however we were dealing with billions of dollars.” Before the crisis, says Sarno, MSC ordered 32 14 000-TEU vessels that are being delivered at a rate of one every three to four months. “We’ve crossed the line and will have to work to fill these, but with our leadership and flexibility it will be possible.” Sarno does not believe the size of vessels calling on South African ports will change a great deal. “We need to upgrade our port facilities however as for instance our ships can only load up to 80% of their capacity in Durban because the depth is still only set at 12m. They have to continue to upgrade the current port even if they have a plan to create another port.” MSC has weathered the financial storms of the past 30 years and will continue to do so in the years ahead, concludes Sarno. “We have been like an army moving together under strong leadership and motivation. That is the strength of our company. Our people have pride in what they do and for whom they do it.”