BMI View: We envisage a quite torrid 12 months for Venezuela 's shipping industry, with the country's two main ports (Cabello and La Guaira) both set to register contractions across box and tonnage throughput. We continue to believe that the recession that began in 2014 will become even more pronounced in 2015, and negative growth will persist into 2016, with the shipping industry not strong enough to withstand these headwinds.
The country's largest port by some margin is Puerto Cabello, is set to once more see growth reverse, indeed positive year-on-year (y-o-y) growth has not been achieved at the facility since 2012. Similarly, the port of La Guaira will struggle in 2015 with both container and tonnage throughput shrinking by 1% which is, nevertheless, an improvement on 2014's performance.
Infrastructure projects in Venezuela and Ecuador are heavily funded by the government as their hostile business environment has deterred and actively rejected private investment in the sector. Declining government revenue - as a result of falling oil prices - will likely see the delay and cancellation of projects, particularly those currently in the planning stage, with the ports sector set to suffer as a result. In addition, as Venezuela and Ecuador have very limited access to international capital markets, we expect their dependence on Chinese funding to considerably increase for as long as oil prices remain low.
Headline Industry Data
2015 Puerto Cabello tonnage throughput growth is forecast to contract by 0.50%.
2015 Puerto Cabello container throughput to contract by 2.00%.
2015 Port of La Guaira tonnage throughput growth forecast to contract by 1.00%.
2015 Port of La Guaira container throughput to shrink by 1.00%.
Key Industry Trends
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