Greece Shipping Report Q4 2010 - New Market Report Published
New report provides detailed analysis of the Logistics market
Published on September 30, 2010
by Press Office
(Companiesandmarkets.com and OfficialWire)
LONDON, ENGLAND
Greece's two main container ports, Piraeus and Thessaloniki, followed the global trend by posting year-on- year (y-o-y) increases in box throughput in H110. We believe that despite Greece's economic troubles the nation's ports are on course to post y-o-y growth for the whole of 2010. Projected container throughput volumes remain, however, well below the volumes seen a few years ago, and highlight the affect of strikes and the global downturn in trade on the ports. The country's largest container facility, the port of Piraeus, handled 376,727 20-foot equivalent units (TEUs) in H110, while the port of Thessaloniki handled just over 155,000TEUs, a y-o-y increase of 5.3%. We believe that this growth in throughput is symptomatic of the global trend of y-o-y improvement in throughput as global trade begins to recover. This growth comes despite Greece's economic problems, which our country risk desk asserts will have affected the nation's trade, with Greece's total trade set to stagnate in 2010 and then decline by 1.6% y-o-y following a projected global slowdown in 2011.
Following the financial crisis earlier this year, the Greek government faces a major fiscal and political challenge over the remainder of 2010 and into 2011. Current plans require it to reduce public spending by a massive 5% of GDP in 2010 alone, with further reductions in subsequent years. The downside for the country's ports and shipping sector is that the struggling PASOK government may simply crack under the pressure of opposition, public protests and strikes, doing so ahead of the 2013 parliamentary elections, and triggering a new round of political uncertainty while putting the EUR110bn IMF/European Union rescue package in jeopardy.
Although perhaps hard to imagine, there is also an upside: if the radical restructuring of the economy to shrink the bloated public sector is successful, outward-looking and more efficient sectors such as shipping will have to be in the forefront of the eventual recovery. In the wake of the EU rescue package and painful fiscal adjustment at home, we are estimating that GDP will have fallen by 4.6% in 2010, after a 2% fall in 2009. We see no early relief either, with our projections suggesting the economy will contract again in 2011 by 2.4%, the third consecutive year of negative growth.
We estimate that 2010 will be pretty much a stand-still year for Greece's main ports. At the Port of Thessaloniki, where volumes fell by 14.8% in 2008 and by another 6.7% in 2009, this year we believe there will be negligible growth - an increase of 0.2% to 14.985mn tonnes. We see no real change in 2011, either, forecasting that volumes will edge down by 0.1%. At the Port of Piraeus, where there was a massive fall of 47.9% in 2008 and a 10.7% recovery in 2009; we are estimating this year's growth at only 0.2%, taking volume handled to 11.621mn tonnes.
At Thessaloniki we estimate container throughput will have stood still this year - +0.6% to 271,677TEUs. We forecast a weaker 2011 with volume falling by 0.3%. At Piraeus, which remains the country's largest container terminal, we estimate growth this year will be 0.4%, with handling reaching 513,907TEUs. In real terms, the value of Greek trade collapsed by 15.7% in 2009, and our estimates point to it remaining trapped at that low level in 2010 (we are predicting growth of only 0.1%). Contrary to our earlier expectation of marginal recovery in 2011, we now expect it to fall back by 2.0% with growth not resuming until 2012. In nominal terms, imports will have dropped 0.1% this year to US$100.9bn, while exports will fall 0.3% to US$64.8bn. We see Greece continuing to run a large balance of trade deficit across the entire forecast period.
The risks to our forecast for the ports and shipping sector remain on the downside, and the single most important of these risks is that the Athens government fails to deliver the promised fiscal restructuring.
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Greece Shipping Report Q4 2010:
Greece Shipping Report Q4 2010 Market Report, Industry Analysis and Market Trends - 23 September 2010
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