The only constant feature in the maritime industry is change and it is safe to state that this phenomenon is prevalent in all shipping sectors.

In the case of liner shipping, this sector is in a continuous state of flux, with the major carriers constantly adjusting and adapting their strategies not only in reaction to demand and supply but also in anticipation of future trends.

Perhaps it is not sensational news, but those of us whose livelihoods depend on the local maritime industry, were positively impressed to learn about the new development at Malta Freeport Terminals (MFT), namely the decision of the two leading shipping consortia, to choose MFT as their main transhipment hub in the central Mediterranean.

One of the major developments to hit the global liner industry at the beginning of 2015 was the grouping of diverse shipping lines into various consortia. The raison d’être behind the establishment of these consortia is to enable the carriers to operate even bigger vessels and to take full advantage of the economies of scale resulting from the larger vessels and to reduce costs through consolidation and rationalisation.

The two leading consortia worldwide are the 2M, made up of Maersk and MSC, and Ocean 3, made up of CMA-CGM, China Shipping and UASC, who will be operating over 350 ships, including vessels of 18,000 20ft container capacity.

Given the size of these entities and the anticipated financial impact that this development will have on the world economic growth, it is a highly commendable achievement for MFT and for Malta that these two leading consortia have chosen MFT as their main transhipment hub in the central Mediterranean.

Such developments are not the fruit of chance or coincidence. Rather, these are the results of years of strategic marketing, judicious directions and above all a consistent and credible track record of the performance of the terminal.

The name of the game is efficiency. These global carriers have to monitor all their operations to the last minute because competition is so tough and there is absolutely no room for slack or delay. Hence, their choice of MFT is a credit to the terminal itself because were it not consistently efficient, such lines would not take the risk of choosing Malta.

Malta should build on such success and other success stories in the maritime field

From a macro perspective, such a development results in positive economic developments that trigger a multiplier effect mainly due to the range of service providers, apart from the terminal itself, who are involved in such operations.

The direct activities that are generated include: the call of the vessels in port; the transhipment of containers; the handling of the containers on the terminal; the generation of feedering networks for the carriage of containers to their final destination; the generation of multiple economic activities through the support services provided to ships calling at Malta; and the increase in demand for infrastructural development for terminals and quays.

It is not commercially prudent to go into the specifics of what these lines pay when calling at Malta. However, there is no doubt that on an annual basis this development will generate a substantial income for Malta’s economy, the terminal and service providers. Apart from fees paid to the terminal, the shipping lines are also paying for services such as pilotage, mooring, towage, port services, ship agency services, ship chandlers and bunker supplies.

Apart from these direct services, it is normal for vessels to request and pay for additional services while in port, including stores, repairs, surveys, supplies of spare parts and transport services.

These two consortia will be having an average of nine weekly calls or 468 when extended on an annual basis. These ship calls, together with other shipping lines already calling at MFT, will provide a regular network to 128 ports worldwide and the net beneficiary of this unique network will be Maltese imports and exports.

Malta’s seaborne trade when compared to transhipment traffic is negligible, but because of these extensive networks, Malta’s imports and exports will benefit from short transit times and competitive rates.

If one takes a step back and views these developments within the perspective of Malta’s geographical size, population and GDP, one is allowed to feel proud. This sense of pride, however, cannot be allowed to go to our heads because this is an industry which is constantly on the move and if the MFT and Malta do not deliver every time and all the time, these shipping lines just move on to the next best location.

Malta should build on such success and other success stories in the maritime field to cluster its resources to better market a maritime Malta, to enhance the existing services and to broaden its services to an even bigger audience.

The positive experience of maritime clusters in other established and not-so-established maritime centres should serve as a beacon for Malta to steer itself on an even steadier course in this important industry and economic activity.

Godwin Xerri is managing director, Combined Maritime Services.

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