The downturn in the shipping sector will not last for long, the chief executive of Chinese giant Cosco said on Monday, expressing hope that demand would rebound in the first half of next year.
Global shipping, facing its worst crisis in decades, has seen dry cargo rates dive more than 90 percent after a five-year boom. But Cosco said investors need to replace panic with confidence to help the sector recover.
"The financial tsunami affects real shipping demand. Shipping is diving due to the panic of investors ... but the diver has to come up eventually," Cosco CEO Wei Jiafu said during a visit to Greece to sign a deal to operate container services at the country's largest port.
"The downturn in the shipping sector will not last for several years ... I hope in the first half of next year shipping demand will be back," he told reporters in Athens.
Cosco Pacific, a unit of Cosco Group and the worlds' fifth largest port operator, will sign a guaranteed 3.4 billion euro ($4.28 billion) deal on Tuesday to manage and upgrade facilities at Piraeus Port (OLP) for up to 35 years. The amount will be paid over the duration of the contract.
Wei said the concession would profit Cosco in the long term and would bolster Greece's cargo business. OLP has already said it expects the deal to boost profit by at least 60 percent over five years.
"We don't expect the crisis to last for 35 years," said Wei, laughing. "In 35 years, we can make a reasonable return on this investment."
Cosco Pacific said last month it would cut capital spending in the fourth quarter and in 2009 to strengthen its balance sheet amid the global crisis. Wei did not say if the company would cut investment to mitigate the effects of the crisis.
Cosco Pacific operates ports in about 160 countries around the world including Belgium, Italy and the Netherlands. It sees Greece as China's commercial gateway to Southeast Europe.
Greece's major ports have seen container pile-ups and have slashed imports since January as dockworkers have refused to work overtime in protest at the deal, which they say will lead to job cuts.
Wei said the deal would create 1,000 jobs, but OLP expects to be in the red this year, hurt by the labour actions.
Dockworkers have also planned a 24-hour strike and protests for Tuesday, when the two companies are expected to sign the deal in the presence of Greek Prime Minister Costas Karamanlis and China's President Hu Jintao.
Global shipping, facing its worst crisis in decades, has seen dry cargo rates dive more than 90 percent after a five-year boom. But Cosco said investors need to replace panic with confidence to help the sector recover.
"The financial tsunami affects real shipping demand. Shipping is diving due to the panic of investors ... but the diver has to come up eventually," Cosco CEO Wei Jiafu said during a visit to Greece to sign a deal to operate container services at the country's largest port.
"The downturn in the shipping sector will not last for several years ... I hope in the first half of next year shipping demand will be back," he told reporters in Athens.
Cosco Pacific, a unit of Cosco Group and the worlds' fifth largest port operator, will sign a guaranteed 3.4 billion euro ($4.28 billion) deal on Tuesday to manage and upgrade facilities at Piraeus Port (OLP) for up to 35 years. The amount will be paid over the duration of the contract.
Wei said the concession would profit Cosco in the long term and would bolster Greece's cargo business. OLP has already said it expects the deal to boost profit by at least 60 percent over five years.
"We don't expect the crisis to last for 35 years," said Wei, laughing. "In 35 years, we can make a reasonable return on this investment."
Cosco Pacific said last month it would cut capital spending in the fourth quarter and in 2009 to strengthen its balance sheet amid the global crisis. Wei did not say if the company would cut investment to mitigate the effects of the crisis.
Cosco Pacific operates ports in about 160 countries around the world including Belgium, Italy and the Netherlands. It sees Greece as China's commercial gateway to Southeast Europe.
Greece's major ports have seen container pile-ups and have slashed imports since January as dockworkers have refused to work overtime in protest at the deal, which they say will lead to job cuts.
Wei said the deal would create 1,000 jobs, but OLP expects to be in the red this year, hurt by the labour actions.
Dockworkers have also planned a 24-hour strike and protests for Tuesday, when the two companies are expected to sign the deal in the presence of Greek Prime Minister Costas Karamanlis and China's President Hu Jintao.