[ KSC & JSA Announced the Joint Statement ]

1. Delegations of the Korea Shipowners' Association (KSA) and the Jap
anese Shipowners' Association (JSA) held the 7th Korea-Japan Shipowner
s' Meeting on October 28-29, 1996 in Pusan. This meeting, which follow
ed the last meeting held in Onuma in 1994, was held in a friendly atmo
sphere where frank and constructive opinions were exchanged between bo
th sides. Attached is the list of the delegates.
2. The chief delegates, on behalf of both sides, expressed their opini
ons on the status and prospects of the maritime system and policy of t
heir respective governments. It was agreed that both sides make furthe
r efforts to cooperate closely and seek common measures to cope with t
he situation related to intense competition and stabilization of the s
hipping market.
3. Both sides recognized ever growing importance of Asian carriers' ro
le in the world shipping market and noted with satisfaction a progress
of Asian carriers' discussion in the Asian Shipowners' Forum(ASF) tow
ard steady and healthy growth of the overall shipping industry.
4. Subsequently, both sides expressed their full support and cooperati
on to the activities and directions of the ASF and its six "S" committ
ees. It was agreed that both sides will maintain their contribution to
the ASF for its consistent and harmonious progress in solving common
problems of the Asian carriers.
And it was agreed that, whilst the effective and consistent Port State
Control will be encouraged, further efforts shall be made to achieve
the uniformity to prevent the excessive and unnecessary inspection on
the quality vessels.
And both sides reaffirmed their continuous support on the various
measures, including the Port State Control and the promotion of ship-d
emolition industry, to eliminate sub-standand vessels in order to pres
erve the marine environment.
5.Hearty congratulations were given on the acceptance of Korea's
membership to the OECD and both sides agreed to cooperate each other t
o harmonize worldwide maritime policy for healthy development of world
hipping industry.
6. Both sides expressed grave concern over the movements by the EU Com
mission against anti-trust immunity having long been granted to the oc
ean carriers' conferences and agreements. It was reaffirmed that anti-
trust immunity is very essential for the carriers' group to achieve tr
ade stabilization through their collective effort.
With regard to "Toward a New Maritime Strategy" issued by the EU Commi
ssion in March 1996, both sides agreed to monitor further development
in order to ensure that a forthcoming EU shipping policy will not affe
ct the commercial activities of non-EU shipping companies.
7. According to the JSA's proposal, in November last year, the KSA sub
mitted a petition to the U.S. Senate (Committee on Commerce, Science a
nd Transportation), regarding the "Ocean Shipping Reform Act of 1995"
and was encouraged with favorable responses from the responsible autho
rities including the White House, Department of Transportation, NITL a
nd so on.
8. And both sides expressed deep concerns and strong objections to the
proposal last August by the Panama Canal Commission(PCC) to increase
the general toll rate for vessels passing through the Panama Canal ove
r the next two years. This increased rate is so great that it might in
tensify the current management difficulties faced by the shipping comp
anies. Both sides agreed to deal with the situation through a common v
oice.
9. Both sides reaffirmed that a closer relationship should be maintain
ed and reinforced through the Exchange of Personnel and Joint Study Me
eting on Seamen-Related Problems.
10.Both sides agree that the next regular meeting would be convened in
Japan in 1998.


MSC Mr. Aponte Offers Glimpse of Empire

Gianluigi Aponte, the soft-spoken founder and president of
Mediterranean Shipping Co., interrupted a visit to his U.S. headquarte
rsto offer a rare glimpse of his empire.
Mr. Aponte, a graduate of the Italian Maritime Academy at Sorrento, is
a sea captainturned-magnate.
"We have a very simple system," Mr. Aponte said on a recent visit to M
anhattan, his U.S. headquarters. "I do only what I can control. What I
can't control I don't do." Then he adds that his own Knowledge of shi
ps is so broad that "I have bought ships in five minutes, without seei
ng the ship. It might be in Hong Kong. I can buy it on the spot if it
sounds right to me."
Envision a company that's run sort of like the old New York Yankees:st
rong farm system, seasoned managers, quiet, can-do players, money in t
he bank and low-cost, niche business tips to Boston and Baltimore.
Mediterranean Shipping is private -- no annual reports, no filing, no
worries about off-hand, after-dinner remarks moving the stock and brin
ging in pushy government lawyers.
Mr. Aponte, age 56, owns 70 and charters 12 ships for a container flee
t of 82, all in the 3,300TEU range, plus three passenger liners and a
score of ferryboats, crewed 80% by Italians, with a per-day crew cost
of $3,500 and some 6,000 employees, 13 U.S. offices and 70 global agen
cies.
"Yes, we have a better return than other companies," says Mr. Aponte.
And... it is a billion-dollar company with less than 10% debt. The Yan
ks in their best years could not match that.
"We pay for our ships with profits," said Mr.Aponte, whose family memb
ers have been sea-farers for 300 years.
Operational employees are famous for griping about management. As a 30
-year-old cap-tain in 1970, Mr. Aponte dispensed with the gripes.
He put down his own $5,000, scraped up $275,000 in credit and purchase
d a used twin-decker that he sent tramping.
Mideast war had closed the suez Canal. Risk-tanker Mr. Aponte purchase
d a second ship and began service down the Atlantic side of Africa, ar
ound the stormy Cape of Good Hope, and began calling the Indian Ocean
side of the continent; at Victorian Durban and the old Portuguese colo
nial outpost, Laurence Marques, now Maputo; at Mombassa and up to Arab
ia's Asian gateway, the Red Sea, then all the way back around again to
Europe.
"There was a very good freight rate at the time. We went with the mark
et..We had to buy second-hand vessels and dedicate them to the market.
..In 1980 we realized the container was changing everything rapidly ev
erywhere... We sold 14 to 16 twin-deckers and went into containers. We
came to the United States with three small, 300-TEU ships. Europe to
the States, our first run was New York, Baltimore, Norfolk. I must say
we always made money. We have always been a cheap carrier."
MedShip through the years gained market share ground as an independent
carrier, working outside of traditional ship line ratemaking groups.
In last few years, however, it has started participating in such group
s, notably the Trans-Atlantic Conference Agreement.
Conference membership "depends on the situation," Mr. Aponte says.
Far East is problem
Of last week's Box Club meeting? "We had very general discussions... T
he Problem shipping is facing today is the Far East... It is difficult
to get agreements when lines have all ordered new ships. There is a c
risis.
Everybody is losing. That is why everybody has to accept a compromise.
This means to take a lower share. I don't think today the ship owners
are prepared to do this... For the time being, everybody is expanding.
"That has turned into a problem on the Pacific, where rates have plung
ed in recent months as carriers added new, large ships to their fleets
. Those problems could spread to the Atlantic, Mr. Aponte believes. As
Mr. Aponte's president of American operations, Capt. Nicola Arena, po
ints out: "If you replace 3,000-TEU ships with these big, 5,000-TEU sh
ips, you don't get rid of these smaller ships. The temptation is to pu
t them into the Atlantic... We have a lot of ambitious people around.
We are watching with certain concern."
Likes small ships
Mr. Aponte likes smaller-sized ships. "If the rate goes down, the
3,000-TEU vessel is better. A large ship is compelled to tranship," he
says. And he is against mergers - "People merge to rationalize."
Remarkably, he says he has never furloughed anyone for lack of perform
ance. Rather he takes the blame for putting shortcomers into overly ch
allenging slots.
"If it doesn't work we make him a success," Mr.Aponte says.
Seamen are veterans
Some 60% of his line managers are veteran seamen. He views his employe
es' shipboard years as his own private MBA school, and he does not smi
le, even faintly, when he describes employees as family. It is a serio
us point.
Pressed, the line president ventures into his philosophy.
“I never made a bad decision. This is due simply to the fact I could
not afford it... Life is directed by pressure. If you have no money, y
ou cannot make mistakes. You make mistakes when you lose attention."
Advice to anyone entering the business? "Try to be professional. Try t
o be moral, very moral. I think morality is the strength of a man. Sti
ck a lot to one business, if possible."