A good dose of optimism
"Staying optimistic is very important because it is not just an economic and financial crisis but a psychological one,” Hans Smit, Rotterdam chief executive
Perhaps one of the most surprising weapons in the anti-crisis armoury is a good dose of optimism, Hans Smits, chief executive of the Port of Rotterdam Authority, tells Port Strategy.
“Staying optimistic is very important because it is not just an economic and financial crisis but a psychological one.” If people don’t have trust and confidence this can have a very negative effect on decision-making, he says.
“In the port generally, there was always the attitude that it’s a crisis and it hurts but we will come out of it and we will come out of it stronger.”
Some very tangible measures have also been put in place, he adds. For the first time in its history, the port lowered the harbour dues with a one-off 7% crisis rebate. In addition, Rotterdam offered discounts if existing shipping line customers would bring extra traffic to the Dutch port.
And here the port really invested, he points out, with these measures costing around E20m ($27m). “We wanted to show our customers that we feel their pain and that we can help them.” Mr Smits stresses that no loops have been scrapped out of Rotterdam. These measures may have partly been responsible for the growth in market share, he adds. Rotterdam has managed to grow its market share from 35.1% in 2008 to 36.8% and in containers, from 26% to 28%.
In addition, along with the City of Rotterdam, the port authority has devised an agreement covering several measures to cope with the crisis and for the longer-term. This covers port labour, education and training. The port has also speeded up some investments in infrastructure and maintenance during this quieter time.
Mr Smits is very pleased to note that investments related to its huge reclamation and port expansion project, Maasvlakte 2 have gone as planned. Work has already started on the Rotterdam World Gateway quay walls. This means that the first containers will be handled in 2013 optimistically and 2014 realistically, he says. Mr Smits comments that a real advantage of Maasvlakte 2 is that it can be built according to demand, adding 500 m of quay at a time.
In the energy/chemical sector the port is preparing a position paper for the Maasvlakte 2 that should be ready by the summer. He expects the official process for leasing out plots to start in this sector by end 2010.
Meanwhile, LionGas, an LNG regasification terminal that was due to developed, will not be going ahead. But Mr Smits is not too worried saying that the earmarked 45-hectare site has direct access to the sea and there is plenty of interest. Instead, it could be used for drybulk or chemicals, he adds.
In a slight change to the original strategy for Maasvlakte 2, the port has also decided that distribution activities will be kept to a minimum. “We don’t want to have any extra flows of goods over the road.” New distribution activities can instead be located on the existing Maasvlakte.
Mr Smits describes himself as “cautiously optimistic”, adding that he expects to maintain the 3%-4% growth target for this year. “The first two months have been more or less in a growing mode." But, he adds that the worst may not be over for some port companies that are later in the cycle.
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