ECONOMY

Storms hit coastal shipping

The sailing has been especially rough for the Greek coastal shipping industry since the sinking of the Express Samina a year ago, as the relentless wave of critical publicity has been compounded by adverse operating and financial conditions. The unfavorable potential impact on tourism of the terrorist attacks in the United States on the eastern Mediterranean, and the concerted response that is likely to follow, look likely to worsen prospects further. Companies have long complained about the regime of regulations still in force which determines fares, and requires them to employ an excessively high number of seamen and operate vessels for 10 months of the year. They argue, for instance, that the resting period for ships should be considerably extended during the off-season from mid-September to mid-May, when scheduled departures are reduced as service requirements can be met with fewer vessels. They have also urged the government to introduce so-called trunk routes and separate schemes for short distances, and draw on the model employed by the Norwegian coastal shipping industry, which operates in a similar milieu with numerous islands. Another standing complaint is the general state of port facilities, which is the main contributing factor to the delays that inevitably hit the industry during the high season, which in turn fuel the adverse publicity for the industry. Sources say that the industry incurred particularly high losses during this year’s high season that has just ended, largely due to a steep rise in the price of fuel. The introduction of high-speed vessels also seems to be severely and permanently eroding the profitability potential of conventional ferries. The largest operator, Hellas Flying Dolphins (HFD) – the renamed Minoan Flying Dolphins, which owned the Express Samina – estimates losses of 3.5 billion drachmas from its conventional ships alone. Lesvos Maritime Company (NEL), which introduced three new French-built high-speed vessels, does not appear to have realized any improvement from last year, when it reported losses. Other operators, like Minoan Lines, ANEK and DANE, do not seem to be faring any better either. The Greece-to-Italy segment of the industry has sustained losses in the number of passengers and trucks – largely due to the mad cow food scare, which severely reduced food imports. Industry executives insist that prospects for the sector are rather bleak without help from the government. They point out that operators have invested heavily in modernizing their fleet, and that it will take years before they realize any returns from these outlays.