Palestine’s newest infant industry — shipping — was born during the depression, has gone through the perilous days of the Italo-Ethiopian War, bears the scars of a rate war and is planning now for expansion.
The Holy Land’s shipping trade, represented by the Atid Navigation Co., Ltd., decided at a recent directors’ meeting to increase its capitalization from $150,000 to $250,000 by issuing $50,000 in common and $50,000 in preferred stock.
With freight rates higher than at any time since 1930, Dr. Jens Borchardt, managing director, reported that there would be a shipping boom shortly. The company has enlarged its services by acquiring a fourth ship.
Singularly enough, the depression favored the new industry’s development. When the Atid Co. started in business 18 months ago, the depression made initial expenses low since ships and ship accessories were cheap.
The company took over the S.S. Atid (which means “future” in Hebrew) and enlarged an existing Danube-Syria-Palestine line. Two more ships — the S.S. Alisa and S.S. Amal — were acquired to open a regular coastal service with calls at Egyptian, Palestinian and Syrian ports. Recently, a new ship was chartered.
It was in the coastal service that the new company found itself engaged in a rate war with a competing company that forced its rates below cost. The battle for supremacy, however, attracted many new customers so that by the end of last Summer, the company had acquired a third of the total cargo traffic in the Levant coastal services.
World freight rates soared with the outbreak of the Italo-Ethiopian War last Fall, competition ceased and the company was able to make up its losses. But business dropped again at the beginning of this year and the balance sheet for the period showed a slight loss.
The six-month reign of terror, breaking out in April, plagued the struggling shipping line, reducing its tonnage at a time when rising rates would have made it possible for the company to show a profit. With the disorders over, the Palestine shipping industry looks forward to good times.