This year, the company marks 150 years of its operations and shipping along the entire Danube River. In this jubilee year, the company has embarked on an investment cycle worth 40 million euros geared towards overhauling and renovating its fleet. This unarguably large endeavour will last for several years. The company’s acting director general Biljana Čvertkov talks about the way in which
the investment is going to be realized and the company’s overall development.

■ You started 2012 with an announcement that the company will invest 40 million euros. Can you elaborate on this and when is this investment going to be implemented?

- I would rather call it an investment cycle, which, in a way, started in the second half of 2011 with the emergency investment programme, will last until at least 2017, during which time our fleet is going to capacitated and overhauled. Since investments in shipping are long-term, whether we are talking about ships or barges, it takes time to either build, repair or fix them. We have decided to start with investing in facilities that will appear on the market first and, by doing so, form a basis for future investments. Through these investments we are going to harmonize our fleet in line with the latest standards, with an emphasis on newer generation engines with reduced gas emissions and on constructing vessels with double broadsides and double bottom which will make navigation much safer. 

 

■ The company’s new management should be credited with consolidating JRB’s operations and embarking on new investments. How much did the broader cooperation with the Ministry of Economy and Regional Development and the Serbian Government contribute to that?
- It is the company’s managing board, which was appointed by the Serbian Government, which established the needed contacts between the government and the new management. We have recognized the Government of Serbia and the Ministry of Economy and Regional Development as our partners that share our intentions and strategic aim in preserving the essence of JRB in this diffi-
cult moment for the economy and increasing the value of the company through joint investments. Also, we agreed, that when the time comes for JRB to be fully privatized the state gets an economically sound and fair price for it.

■ JRB is the biggest company in international river transport in Serbia. Did economic woes affect your business operations, i.e. did the transport volume increase or decrease?
- It would be falsely modest if I didn’t say, with pride, that JRB takes one of the first positions in the international river transport in Serbia and we intend to stay in that position for a very long time. Concerning the economic crisis, i.e. its onset in August 2008, we felt the first impact in early 2009. JRB survived this crisis period thanks to its capacities for transporting both river and dry-land cargo, so if it occurred that at a certain point we had no river cargo to transport, we would step up our activities in transporting dry-land cargo or vice versa. Early 2011 was very promising since we concluded contracts with old partners and managed to secure good transport conditions. Unfortunately, during the main season for the shipping industry, i.e. in spring and autumn, we had to go through something even worse than the economic crisis – low water levels. Just like any other shipping company, we had no way of dealing with that and we were forced to declare force majeure on two occasions. Let me illustrate this with an example – our large barge, in full draft, can take up to 1,500 tons but when the water level is low that quantity is reduced to a maximum of 1,000 tons. This led to our revenue dropping by a third while the costs were either the same or even higher. If you add that to the fact that we were at a standstill for two and a half months because of force majeure, then you can imagine just how difficult the situation was our company. As a side note, every year there is a period when the water level is low but it usually lasts for a month or two, but even seasoned shipping veterans cannot remember a time when the water level was low for the whole two and a half months. In short, during the economic crisis, our transport activities were reduced by 25% compared to better years. Last year, apart from the crisis, the low water levels and suspension of navigation seriously affected the transport volume.

 

■ What is JRB’s core activity and has the company’s business volume been increasing year-on-year?
- JRB’s main activity is the river transport of goods that makes up 95% of our work. The remaining segment of our activities pertain to providing agency services to domestic and foreign shipping companies since JRB has its agency in all major Danube ports – from Prahovo to Bezdan. Our business has been stagnating in the last two years due to the aforementioned reasons.

 

■ What kind of fleet does your company have?
- Our fleet is one of the older ones which means that there are younger fleets navigating the Danube as well as older ones. We have started overhauling activities - four ships are currently being overhauled. Of course, we expect to acquire new vessels, but that doesn’t depend solely on us. If the Ministry of Economy and Regional Development renders the agreed support, JRB and Serbia will become visibly present on the Danube river with a respectable merchant fleet.

 

■ Apart from transport, what other business activities are you engaged in and what are the expectations of your business partners?
- I think that JRB needs to keep on operating on the Danube and do what it knows best , which is offering its partners the safe transport of goods while making sure that their goods will be shipped in the best and fastest manner possible. The fact that we are right in the middle of waterways is the best reflection of our position and our future prospects.

 

■ An attempt to privatize JRB has failed. Are you going to repeat the privatization process?
- You have to ask the Privatization Agency that. We, in the com-pany’s management, are more concerned with operational issues, fully employing the company’s capacitiesand revitalizing its fleet. I would like to add that the privatization of shipping companies, which operate on
the Danube, did not result in these companies advancing. Some of the privatized companies have already changed owners two or three times which is certainly not good for business. During this economic crisis, both private and stateowned companies are fighting for survival.

■ How much is JRB fostering the tradition of one of the oldest and the most important river shipping companies in Serbia?
- Just like the shipping industry, which was founded in Serbia in 1862, JRB is celebrating 150 years of operations and shipping activities in Serbia along the entire Danube River. There are very few companies that have such a long tradition as JRB. Looking back at the company’s history, I can tell you that JRB was the first shipping company to have used thruster systems on the Danube and, by having that, we made a huge leap forward in the modernization of river shipping in the 1970s. We are confident that we are going to continue to respectfully represent our country and its tradition for many years to come and that we will proudly continue to display the Serbian flag on our ships throughout the Danube River. ■