Shipping

ITF document marks radical flags shake-up

New Delhi: It is not exactly what anyone would call an admission of defeat, but the remarkable International Transport Workers' Federation document 'From Oslo to Delhi' - due to be put to seafarers and dockers at the union groupings' Congress in New Delhi - marks the most radical shake-up seen in the Labour movement's fight against flags of convenience since the campaign's inception in 1948.

Shipowners have long argued that the federation's determination of which registers are labelled flags of convenience is outmoded.

Owners' organisations maintain that they too are against substandard shipping, but that some open registers maintain quality and some national flags simply do not. In short, the ITF approach is too simplistic for the modern world.

For its part the federation explicitly rejects calls to designate individual flags of convenience as either "good" or "bad".

Nevertheless, it is well aware of the dilemma in which it finds itself. Flags of convenience are not necessarily public enemy number 1, even from an ITF standpoint.

An even bigger threat to jobs for some ITF affiliates comes from some bona fide national flag vessels, where pay is below even International Labour Organisation standards, the document concedes.

"Applying industrial action in support of ITF wages to seafarers serving on a bona fide national flag vessel may trigger diplomatic reaction from the flag state authorities, which are likely to be much more aggressive in their actions than flags of convenience which are, to a large extent, simply commercial operations .

"This can, however, be turned to the seafarers' advantage if the flag state concerned is noted for the poor condition of its national fleet and is sensitive to international publicity."

The list of the flags of convenience is accordingly likely to be rejigged as a list of both flags of convenience and substandards registers.

Policy also needs to be updated in the light of continuing globalisation of the shipping industry; a situation such as the Neptune Orient Lines takeover of American President Lines throws up a number of anomalies .

Nationality of shipowners, in and of itself, means little in an era where many countries sell passports for cash. Instead the notion of effective control becomes key.

'From Oslo to Delhi' does not duck the issue of the abuse of current arrangements by some affiliates. Some unions in beneficial ownership countries pocket payment from shipowners in return for releasing the negotiating rights, without providing any service to the seafarers concerned, the document admits.

This undermines ITF attempts to take the moral high ground.

The ITF welfare fund levy has remained unchanged at $230 a year since 1983. It has only now emerged that there were calls for a substantial increase last year, although these were reportedly decisively rejected through internal channels.

Nevertheless, the federation is prepared to consider future increases, and, given its stance that some national registers are as bad as some flags of convenience, even extend the levies' scope.

(Lloyd's List)

Indonesia to create new box handler

State-owned Indonesia Port Corporation II (PT Pelindo II) will soon establish a port operator company as part of its privatisation plan for Container Terminal Unit I and II (UTPK I and II) at Jakarta's Tanjung Priok. PT Pelindo II managing director Herman Prayitno said that the establishment of the new company would allow the port to increase its loading capacity to 2.2m teu, up from the current 1.2m teu.

Thantawi Hamid, financial director of PT Pelindo II, added that the plan would also increase the profits.

"If the plan is applied, it will increase the profit of PT Pelindo by 30%," he said.

Profit at the port has previously, ranged between Rupiah 525bn-700bn ($52.5m-70m). The privatisation plan will be started in November.

Meanwhile, a number of ports under the supervision of Pelindo II should obtain ISO 9002 quality certification by the end of this year, said a company spokesman.

The ports are Cirebon, Panjang, Palembang, Pontianak, and Teluk Bayur.

"The certification process for these ports has been carried out by the state-owned consultation firm Sucofindo since 1997," the spokesman said.

He added that the management of Pelindo II also planned that other ports under its control should obtain ISO 9002 in the near future.

"Pelindo II adopts the policy of certifying its ports because it is determined to provide the best service to the port users," he said.

Pelindo II's Tanjung Priok port and container terminal unit (UTPK) I and II have already received ISO 9002 certification from Sucofindo.

Lloyds List

LR enters comfort zone

Lloyd's Register (LR) has announced the release of its Provisional Rules for Passenger and Crew Accommodation Comfort.

The Provisional Rules are featured in the latest edition of LR's Marine Bulletin, which was published recently. They set noise and vibration criteria for assessing passenger and crew comfort, and are primarily intended for passenger ships, high speed craft and yachts, although any ship can be assessed for compliance.

As well as giving operators a choice in levels of noise and vibration, the Provisional Rules offer alternative levels of certification. One provides for the assessment of a ship's initial design and trials behaviour leading to a Certificate of Compliance; the other also includes life cycle assessment supported by a periodical survey system and the assignment of a Class Notation.

The range of notations is designed to offer operators a choice of notations to fit their unique requirements:

• PAC - Passenger Accommodation Comfort (noise and vibration)

• CAC - Crew Accommodation Comfort (noise and vibration)

•PCAC - Passenger and Crew Accommodation Comfort (noise and vibration) The numerals '1' or '2' following the notation give the comfort rating based on target criteria, '1' being the higher.

The Provisional Rules recognise existing national and international standards and specify noise and vibration levels currently achievable using good engineering practice. These criteria also take into account experience from full-scale measurements.

The cruise theme continues in the Marine Bulletin with a feature on LR's specialist technical investigation work for the cruise industry as well as a look at the latest developments in laser welding for the shipbuilding industry and a technical report on inner bottom plating cracks in bulk carriers.

(Lloyd's Register)

Lloyd's new web site goes live

A brand new web site for the LR Group was launched recently.

This web site, like its predecessor, has been designed to provide up-to-date and comprehensive information about Lloyd's Register and its Group Companies, which include Lloyd's Register Quality Assurance Ltd. (LRQA), Rontgen Technische Dienst BV (RTD) and Stoomwezen BV. But it does so using an entirely new design and improved navigational tools.

The home page uses text and graphics to announce the latest news. Visitors can navigate around the site, using a permanent top bar and context sensitive left-hand bar, to gain easy access to: news releases and LR magazines, exhibitions and conferences, details of LR's services and software products and so forth (Lloyd's Rigister).

Watawala presented John Miller Award

Prof. John Miller AO Award and Honorary Professorship of the Swinburne Graduate School of Management, Melbourne, Australia, was presented to Lakshman R. Watawala, past President, Institute of Chartered Accountants of Sri Lanka and the South Asian Federation of Accountants and President, Association of Accounting Technicians of Sri Lanka.

The honours function was held at the Institute of Chartered Accountants of Sri Lanka on March 30 under the patronage of Minister of Justice Prof. G.L. Peiris.

Prof. Peiris emphasised the leading role played by Mr. Watawala in a multidisciplinary field which included education, industry, commerce, human resource development, banking and finance, foreign investment, poverty eleviation where he had put into practical use his professional knowledge and expertise.

He said this was the first time that a professional from the South Asian Region has received this award and it was a unique achievement and a great honour conferred by Prof. John Miller, a leading Chartered Accountant, Educationist and Management Expert with wide international experience and currently Foundation Director of the Swinburne University Graduate School of Management.

Prof. John Miller in making the award to Mr. Watawala stated that he was pleased to make the presentation due to the outstanding contribution made to the accounting profession in the South Asian region and to Sri Lanka. He emphasised the role played by Mr. Watawala in the formation of the South Asian Federation of Accountants and becoming its first Vice President and then the President.

The role played in the promotion and the setting up of the Accounting Technicians or the Middle Level Accountancy body in Sri Lanka which Prof. Miller as President of CAPA had with the assistance of the Asian Development Bank sponsored the study materials was indeed a great contribution made to develop accounting education and to meet the shortage of Accounting Technicians both in the public and private sector.

Prof. John Miller also announced the decision made by the Council of the Swinburne University of Technology to appoint Mr. Watawala as an Honorary Professor of the Swinburne Graduate School of Management and invited Minister Prof. G.L. Peiris to present the certificate of appointment to Prof. Lakshman R. Watawala.

The President of the Institute of Chartered Accountants of Sri Lanka Lal Nanayakkara, G.C.B. Wijeyesinghe, Past President of ICASL, Nivard Cabraal, Past President ICASL and SAFA also addressed the meeting. Mrs. Ruth Miller, wife of Prof. Miller, the Vice President of ICASL and Deputy President CAPA Ranel Wijesinghe, Nihal de Silva, CIMA South Asian Representative on the Council of CIMA, UK and a large number of Chartered Accountants were present at the function.

DHL named "Best Express Service"

Hong Kong: In spite of the most difficult trading environment in a decade, DHL Worldwide Express showed continued double-digit revenue growth in 1998 across Asia Pacific and the Middle East. In particular, DHL saw impressive growth in China with parcel revenues increasing over 30%.

Air express deliveries of samples, prototypes, spare parts and finished goods from Asia to the US provided the strongest trade flows with DHL recording a revenue increase of over 15% on this sector as the company worked closely with its customers to identify opportunities for export development and business expansion.

"A sustained Asian export performance to the US has contributed to our strong result," said Charles Longley, Chief Executive Officer for DHL Asia Pacific/Middle East. "China, Taiwan, Hong Kong and Singapore continued to be engines of growth for our parcel business in 1998 as businesses ~quickly adapted to the economic crisis and increasingly targeted the US as their major export market," he continued.

In recognition of DHL's commitment to its customers and to service innovation, the company has received the unique honour of being the only air express company to be named the "Best Express Service" for 13 consecutive years at the 1999 Asian Freight Industry Awards (AFIA).

Coats Tootal sponsors craft competition

Coats Tootal Lanka (CTL) will sponsor the Kandy needle craft and fabric painting competition, organised by the Kandy Needle Craft and Fabric Painting Association, which will be held on April 24 at hotel Suisse, Kandy.

This event is sponsored by CTL for the first time to promote the hidden talents and skills of craft lovers in Kandy and to recognise their efforts towards self employment.

The exhibition will be open to the public, to provide an opportunity to view some of the most fabulous embroidery items and needle craft techniques. A key feature of the event will be demonstrations on various crafts such as fabric painting, soft toys and embroidery techniques which will be carried out by the club members to develop the knowledge and skills of the enthusiastic craft lovers.

Veytex debts rise to Rs.280m in 3 years

Veyangoda Textile Mills Ltd obtained an injunction against People's Bank last week, for issuing letters of demand to the value of Rs. 141 mn, Chairman Veyangoda Textile Mills said.

A fortnight ago, Peoples Bank issued the letters warning that severe action would be taken, if the payments were not received within seven days.

Veytex incurred severe losses during the last three years of business with debts mounting to Rs. 280 mn. Sales and operations of the mill have been severely affected since the government liberalised the domestic textile industry during the 1997 budget.

Since then, nearly all weavers have run into difficulties as they are unable to compete with Chinese and Indian textiles flooding the market.

Meanwhile, textile manufacturers are fretting that they are yet to receive promised government assistance under the Textile Debt Recovery Fund (TDRF).

"It's nearly 16 months since the government abolished textile duty and announced a re-structuring package. We are told it will take another month for the fund to be operational," Veyangoda Textile Mills Chairman, Dan Mukundan told The Sunday Times Business.

Local manufacturers were hit and nearly 30,000 jobs were at stake, when the November 1997 budget eliminated import duty on fabric (yarn).

"The President was misled by an inexperienced bureaucracy and the total package is a policy failure," Mr. Mukundan said.

Following representations made by the industry, the government introduced a rehabilitation package to help manufacturers modernise and cater to the direct and indirect export markets.

With total outstanding textile debt topping Rs. 3 bn in 1997, the government's relief package included the entire textile debt being transferred to the fund and the government stepping in to pay the interest for three years.

Textile manufacturers would then be granted BOI status and financial help for future modernisation.

Further to encourage investments, government will bear the full interest cost on new loans given for modernisation for 18 months.

Adweek picks McCann Agency of the Year

Adweek a leading American business publication, whch covers advertising , has named, McCann-Erickson Worldwide its "Global Agency of the Year" for 1998. This is the first time that Adweek has recognised any advertising network as "the most outstanding global agency", says a news release.

In naming McCann-Erickson for this award, Adweek cited the quality of the agency's creative work, its business performance and its marketing and communication strategies. The article detailed Mc- Cann's network growth through its renowned management strategies headed by John Dooner, Chairman and CEO who stated, "The core competence of an ad agency should be the creation and placement of brilliant advertising."

In 1994 the agency captured the industry's top spot in terms of size, scope and geographical reach. Last year, it posted billing of $ 16 billion worldwide, a 16 percent increase over 1997. Revenues were estimated at $2 billion, 15 percent over 1997.

McCann-Erickson's network spreads to 123 countries worldwide and is the ad industry's largest global network. The same global strength is portrayed in the local industry, in which Grant McCann-Erickson is the largest international advertising and comunications company in Sri Lanka.

The compay celebrated its 41st anniversary on April 1, which makes it the oldest international advertising agency in the country. "With the current media clutter, traditional advertising may not always deliver the desired results, it is becoming increasingly important that we find innovative ways of reaching consumers and building brand loyalty for our client's brands, said Mrs. Neela Marikkar, Managing Director. Keeping in line with McCann-Ericksons World Group's Communication Corridors, Grant McCann has introduced new communication corridors such as Public Relations, Relationship Marketing, Direct Marketing and New Media. This also makes it the only "Total communications solutions" company in the country.

Sri Lanka automobile stocks seen zooming

Prospects of a healthy earnings growth this year from recent budget concessions make most of Sri Lanka's automobile stocks attractive medium-term buys, brokers and equity analysts said.

In pole position on recommendations is Associated Motorways Ltd (AMW), closely followed by United Motors Lanka Ltd, which are expected to be the main beneficiaries of a 60 percent duty slash on diesel vehicle imports and a 75 percent cut on petrol vehicle imports granted to government employees.

"AMW and United Motors are the best picks in the sector and should see the highest increase in sales due to their large state sector clientele," motor sector analyst at CT Smith Stock Brokers Sanjaya Silva said.

Shares of AMW, one of the country's main automobile dealers and tyre exporters, ended flat at Rs. 50 and shares of the sole agent for Japan's Mitsubishi Motors, UML last traded at Rs. 32.5 on March 30.

"The motor sector is expected to post at least a 28 percent growth in earnings this year following the permits. Next year should see around a 15 percent rise," equity analyst at John Keells Stock Brokers Suresh Nadarajah said.

"Associated Motorways and United Motors will be the main driving forces," he said.

AMW, in collaboration with India's Ceat Ltd, set up a joint venture earlier this year with Sri Lanka's Kelani Tyres Ltd to manufacture automotive tyres.

Mr. Silva said: "AMW's Ceat deal will also see its bottomline boosted by over Rs. 50 million ($721,709)."

Brokers said it was the opportune time to pick up automobile stocks which have fallen to attractively low prices in line with sharp declines on the Colombo Stock Exchange.

The Colombo all share index fell some 15 percent in 1998 and has spent most of this year trading in a narrow range on concerns over various elections.

On Wednesday the index closed 0.69 percent higher at 539.78 points on speculative retail buying in anticipation that a win by the ruling People's Alliance coalition in regional elections on Tuesday would trigger a mini rally.

"Most motor stocks have bottomed out and will easily run when the market rises," Nadarajah said.

"Trading at a price/earnings (PE) ratio of around five against a market PE of eight makes the motor sector a good buy," NDBS Stock Brokers' Seon Selvaratnam said.

Brokers however advised investors to be selective as not all motor stocks were expected to benefit from the duty concessions.

"Sathosa Motors Ltd does not have a big clientele in the state sector, while Lanka Ashok Leyland Ltd is expected to see flat earnings this year," Nadarajah said. - (Reuters)

HNB 'Pana Muthu' quiz contest

Hatton National Bank has begun a quiz programme titled "Pana Muthu" with the objective of enhancing the knowledge of students and developing a close rapport with schools. There are 31 programmes (each of 30 minute duration) in this quiz series, which will be telecast every Friday at 6.30 p.m. on Sirasa TV.

The series will be based on a quiz competition between teams of school children, selected from the first 32 schools in which HNB established "Singithi" Students Savings Units.

Thirty two schools will participate in the initial round. At the end of the Initial Round the 16 schools that score the highest points will proceed to Round 2. At the end of this Round 8 schools will proceed to Round 3. The 4 schools with the highest score in Round 3 will proceed to the Semi-Finals. In this Round the 2 schools scoring the highest points will qualify for the Finals.

At the end of each programme, both the winning team and the losing team will be awarded cash prizes (deposited in a "Singithi" savings account). In the 1st and 2nd rounds the members of the winning teams will receive Rs. 1,000 each, while the members of the losing teams will receive Rs. 500 each. At the Quarter-Finals and the Semi-Finals the winner will receive Rs. 2,000 each, while the members of the losing team will receive Rs. 1,000 each. At the final round the winners will receive Rs. 4,000 each, while the members of the losing team will receive Rs. 2,000 each.

The winning schools will also receive cash prizes towards their school development fund.

Peanut cookies from Hambantota

The Social Mobilization Foundation (SMF), an apex organisation of the farmer community group in the Hambantota district recently set up a food processing factory with technology developed by the Industrial Technology Institute. The factory, employs 15 youth of the area and has begun production of peanut cookies and peanut crackers. Chamal Rajapakse, M.P. Hambantota opened the factory in early February.

The SMF receives assistance from the Integrated Rural Development Project (IRDP) which is funded by Norad. SMF also receives some input from the Small Holder Intergrated Livestock Extension Project (SILEP) project of the Ministry of Livestock Development and the German Technical Co-operation agency.

The peanut cookies, which come in a very attractive pack of 200 grams costs Rs. 42.50 and the 100 gram handy bottle of peanut crackers costs Rs. 40. The crackers will also soon come in pouches of 20 grams.

The foundation expects an income of about Rs. 400,000 a month from the two products manufactured at present. The factory will also soon expand to produce three more products with ITI developed technology. The products earmarked for this expansion are an instant vegetable soup using low-country vegetables, a quick cooking dhal and a pumpkin candy. All these products will use the raw materials freely available in South Sri Lanka.

The technology was developed by Mrs. Damitha Rajapaksa, assisted by Mrs. Karuna Aponso, with engineering assistance provided by P. Priyananda all of the Agro and Food Technology Division of the Industrial Technology Institute.

"Trade"-theme of economists' AGM

The Sri Lanka Association of Economists (SLAE) will hold its 14th Annual General Meeting and Annual Sessions on Saturday April 24 at the Sri Lanka Foundation Institute.

The theme of the Annual Sessions will be "Future of Sri Lankan Trade".

The keynote speaker will be Dr. J. B. Kelegama, former Secretary, Ministry of Trade. He has also served as consultant to several UN agencies.

The morning session will be on "Trade Prospects" and the speakers will be: Dr. Anila Dias Bandaranaike, Central Bank; Dr. Dushni Weerakoon, Institute of Policy Studies; and Dr. Sunil Chandrasiri, University of Colombo. The afternoon session will be on "Indo Sri Lankan Trade Agreement" and the speakers will be Dr. Sanath Jayanetti, Ministry of Finance; Mahendra Amarasuriya, Deputy Chairman, Hayleys Ltd.; and Dr. Thenuwera, Central Bank.

All members of the SLAE are invited. Please contact Shenuka on 598051 by April 21. Pan Asia Bank will be sponsoring the event.

Eagle does it again

Eagle Insurance has once again gained recognition in the corporate financial world when it won the prestigious award for the best Corporate Report and Accounts in the insurance sector for the fifth year, at the annual awards ceremony held recently. The Best Corporate Report and Accounts competition is organised by the Institute of Chartered Accountants of Sri Lanka

"The Company places much emphasis on good corporate governance and as such its annual report and accounts are timely and clearly in compliance with statutory and best accounting practice requirements. We are indeed happy that this has been recognised by the Institute of Chartered Accountants of Sri Lanka," says Ms. Marina Tharmaratnam, Finance Director, CTC Eagle Insurance.

Investors too can be confident that the Company is maintaining such high standards in disseminating information to stakeholders.

The report is not only about the performance and activities of the Company but is also a reflection of its unique brand identity and brand values.

Two promoted

Mohan Perera, Marketing Manager and S.A.H. Mohideen, Manager Life, Janashakthi Life Insurance Co., Ltd., have been promoted as the Asst. General Manager Marketing and Asst. General Manager, Life Operations with effect from April.

Mr. Perera joined the company at it's inception in 1994. He commenced his Marketing career at Ceylon Tobacco Company in 1982, and counts 17 years experience in the field of Sales and Marketing.

He set up the Area Development Office network for Janashakthi, which is considered as a new concept in Insurance.

Mr. Mohideen a veteran of 37 years in Insurance started his career at the Sri Lanka Insurance Corporation. He served in Air Lanka, James Finlays and National Insurance Company.

Mr. Mohideen is a visiting Lecturer of the University of Sri Jayawardenepura.

Receives membership

Cristy Perera has received the corporate membership of the Institution of the Incorporated Engineers (IIE) of United Kingdom which was earlier known as IEEIE. (Institution of Electronics and Electrical Incorporated Engineers).

He is one of the few in Asia to receive the full membership of the newly formed Institution. After this he was appointed as the Engineering Manager of Dynavision Broadcasting (CNN) Company Ltd., where he joined as an Engineer.

He was responsible for the setting up and commissioning of the station. He is also registered as an Incorporated Engineer at the Engineering Council (UK) and a member of British Amateur Television Club (BATC).

Before joining Dynavision he worked for MTV and Rupavahini from their inception and SLBC from 1978 as a Technical Assistant.

A past pupil of Maris Stella College, Negombo, Mr. Perera apart from his academic qualifications is a member of Radio Society of Sri Lanka (RSSL), Life Member of International Freelance Photographers Organization (IFPO) of USA and Vice President of Sri Lanka Astronomical Association (SLAA). He has also been nominated for the 1999 WHO's WHO International directory of USA. He is a director of Lions Club of Colombo Maitland.

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