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COSCO Develops Remarkably Over Past 4 Decades: CEO
A senior official from China's top ocean shipping company said Tuesday in Boston that his company enjoyed remarkable development since it was founded 40 years ago, and now it is striving to make further progress in the new century.
The statement was contained in a speech delivered at Harvard University, the world-famous institution of higher learning, here by Wei Jiafu, president and chief executive official (CEO) of China Ocean Shipping (Group) Company (COSCO). The speech, entitled "A Miniature of State-owned Enterprises Reform in China: A Typical Case Study-the Process of Development of COSCO GROUP," was greeted by warm applause by the U.S. audience.
COSCO was set up on April 27, 1961, when the company only owned four vessels of 22.6 thousand dead weight tons at first.
"Our way of early development can be described as "to buy vessels by loans, to operate the fleet under the pressure of debts, to return the loans by our profits, and to develop by fully relying on ourselves," he said.
In the 1960s and 1970s, COSCO set up new services and expanded the fleet. In the 1980s, the company started to transit from purely increasing fleet tonnage to perfecting and rationalizing fleet structure.
"The 1990s is a golden era for COSCO's development," Wei said. On February 16, 1993, the group formed the COSCO Group that makes China Ocean Shipping (Group) Company as the core enterprise and comprises China Ocean Shipping Agency and several shipping companies along China's coast.
"We reinforced shipping as the pillar business, while developing land-based industries and air-cargo services. Also we started to pursue operation internationalization, business diversification, and management modernization," he said.
To adapt to the more and more fierce competition in the international shipping market, from 1993 to 1999, COSCO underwent a series of shipping structure reform by setting up specialized fleets, such as the COSCO Container Lines Ltd., the COSCO Bulk Carriers Ltd., the General Cargo Vessels Fleet etc., and companies specialized in freight forwarding, industry, trade and other land-based specialized companies.
Also in that period, COSCO established a set of overseas regional business centers, such as the COSCO Americas Inc. in New Jersey, which is in charge of business in both North and South Americas.
"As one of the 57 national pioneer large conglomerates ranked by the government, in 1998 we started to promote the modern enterprise system characterized by clear property right, distinct division between rights and obligations, and separation of governmental functions and business administration," he said.
In short, over the 40 years, COSCO has grown into a big trans-regional, transnational conglomerate of diversified operations with shipping as the main line of business. At present, the COSCO GROUP has more than 80,000 staff and an asset of over 15,000 million U.S. dollars.
So far, COSCO GROUP has developed into a big shipping corporation owning and operating more than 500 modern merchant vessels amounting to 22 million dead weight tons, including container vessels, bulk carries, general cargo vessels, tankers and special-purpose vessels.
On the basis of several hundred domestic and overseas subsidiaries, COSCO has established a global shipping network taking Beijing as its center, radiating into the whole country and the globe through COSCO's major domestic shipping companies and nine overseas regional business centers including Hong Kong, Japan, Singapore, the United States, Europe, Oceania, Africa, West-Asia and Korea.
COSCO has nearly 5,000 overseas employees, and the majority of them are local people. Its ocean shipping lines can reach and serve more than 1,200 ports in more than 160 countries and regions, and its annual value of cargo transportation capacity has reached nearly 170 million.
"By means of electronic service catering for information transmission for day-to-day business operations and through the realignment of the existing shipping-related businesses such as shipping agency, marine tanker and store supply service, inland haulage and air freight service, COSCO is no longer a traditional shipping corporation, but is growing into a modern comprehensive logistics business group capable of offering punctual, high-quality, efficient logistics services to all clients over the world," Wei said.
"Side by side with the rapid development of shipping and shipping-related services, COSCO had been widely involved in land-based undertakings such as real estate, industry, international trade, finance, tourism and contract employment of seamen, and we are happy to say that the achievements in these areas are remarkable," he added.
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