Aye Captain!

If anyone has firsthand knowledge of Gulf shipping it is Captain Mansoor Ghafoor. Before joining the business world in 1987, the current President of the UAE’s National Association of Freight Logistics (NAFL) and Vice President of the International Federation of Freight Forwarders Associations (FIATA) spent 14 years at sea. He recalls his climb from Cadet to Bridge Captain in the Seventies and early Eighties with fondness.

“Ships were different then,” says the UAE national who serves as Chief Executive Officer for the freight forwarding company and shipping agency STALCO. “You learned proper shipping.”

Captain Mansoor Ghafoor

“Nowadays, a lot of formerly manual tasks are done using computers. For your positioning now, for example, you use GPS. We used to use a sextant for our positioning. It took us half an hour to justify our position, while now crews can do it in less than a minute using a satellite.”

“Sometimes if it was raining, or cloudy, or foggy, you wouldn’t even know your position. You just moved on assumption. Nowadays, it is much easier.”

He describes his life at sea as one of danger and adventure. “You face everything,” he says. “It sometimes happened that someone would get injured, or fall overboard, and we wouldn’t find them. Nowadays, if someone has an accident, a helicopter can fly in and rescue him. In the past, if you had an accident you would have to wait until you reached the next port, which could be five or seven days away.”

Pirates were also an issue, although he never encountered them face-to-face. “We used to have them in the waters between Indonesia and Singapore,” he says, explaining how he shifted his route to avoid them.

While Ghafoor has seen plenty of economic ups and downs in the industry, he says this ‘down’ is the worst he has seen. “Shipping is always a cycle,” he explains. “Every five years you have peaks that then go down. Now, there is a new factor which was never there before – the financial crisis.”

He has seen freight rates drop dramatically. “I would say they are 60 per cent less than eight months back,” the estimates. In fact, in the period between March 2008 and March 2009, the Baltic Dry Index dropped approximately 6,000 points, from around 8,000 to 2,000. Certain lines, such as Senator Lines (Hanjin) from Germany and Great Ocean Container Lines from Hong Kong, have even gone out of business. Ghafoor says he wouldn’t be surprised if plenty of smaller companies in the industry follow.

And many of the shipping lines that remain have excess capacity. “There is a large supply of ships around,” he says. “All the shipping lines were building more ships so they could make more money.”

While his business is down as well, Ghafoor refuses to lay off any of his nearly 300 staff. “I am against this,” he says. “It’s not fair to lay people off. That solution means disaster to others, people who will lose their jobs.” Plus, getting rid of employees now can hurt a company in the long term. “If you lose experienced people who have been with you a long time and they go home, when business becomes normal you may need them back,” he says. “You have to be together in the good and bad.”

Ghafoor does not agree with the statement that Dubai is ‘dead’. “Yes, we are affected, but we are not paralysed,” he says. “Business is still running, just at a lower volume. I don’t think it is that bad.”

He says he expects Dubai’s economic situation to look brighter with in a year. “By the end of 2009 things should be much better,” he says.

“I’m not talking about real estate – that’s a different story. But, in general, I think things should be back to normal.”