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PANAMA - Transport

Juan Carlos Croston

VP Marketing, Manzanillo International Terminal

Bio

Juan Carlos Croston is Vice President Marketing & Corporate Affairs with MIT-Panama. He’s an ocean shipping fan and a public advocate for the positive impact ocean shipping has in the world. Juan Carlos worked onboard panamax-type vessels before joining MIT-Panama. He’s a past president of several national and international trade associations and chairs Shark Optimization, an MIT-Panama start-up focused on supply chain optimization. He has co-written articles, contributed to books and is also the co-host of the #NoShippingNoShopping! vodcast. He was granted the Distinguished Alumni Award by the International Maritime University of Panama and was named by Lloyd’s List in their “Next Generation 2015” list of worldwide maritime leaders, the only one from Latin America.

"At the beginning of the pandemic, there were no containers available because of port congestion, a lack of staff, and the closure of warehouses, which is why shipments took such a long time."

TBY talks to Juan Carlos Croston, VP Marketing of Manzanillo International Terminal, about supply chains, challenges, and CSR goals.

How did the pandemic impact supply chains and logistics in Latin America, and how did it differ from the situation in the US and Europe?

We have to consider 2022 in the context of COVID-19; supply chains and logistics were affected to various degrees by the pandemic and its underlying effects. During that time, in Latin America there was little assistance from the government and a large informal sector. A significant part of the population was negatively affected, and GDP in Panama plummeted by 17%. It was one of the worst affected countries. In 2020, GDP in Latin America fell by 7%, and demand in Latin America was affected. In the US and Europe, meanwhile, there was more government assistance for companies, families, and individuals. People at home were safe and had money to spend, which created a massive demand for home improvement related items and organic food. South America is a major producer of goods such as avocados, blueberries, bananas, and mangoes, and because Panama is such an important hub for cargo, related activity in 2020 and 2021 grew. The first half of 2022 followed that same trend, though then inflation broke out, and consumption fell. This resulted in fewer containers moving through the system. We had a great first half to 2022 but a terrible second half. We just have to wait for everything to stabilize.

What factors impact the stability of container movement in Panama?

It has been tough, as expected. At the beginning of the pandemic, there were no containers available because of port congestion, a lack of staff, and the closure of warehouses, which is why shipments took such a long time. Now, things are almost as they were before, and we are seeing a drop off in the movement of containers in Panama of between 5% and 10%, which is expected, given the regional economic situation. Currently, central banks in the region are trying to stabilize and increase the interest rate while stabilizing currencies. There are also environmental concerns, with El Niño affecting Panama, Peru, and Ecuador. Producers and farmers in this country were heavily affected during the pandemic, and just when the situation was returning to normal, they are now affected by El Niño. There is great uncertainty over when the situation will return to normal.

How has the introduction of digitalization and new technologies in the company impacted employment dynamics?

People think more digitalization means less employment. A study showed that from 2010-2018, employment per container move started to fall, though in 2018, when digitalization increased, employment went up. Many people are required to run processes and systems, and this is the case for Manzanillo International Terminal too. We were the first terminal in the world to introduce technology for semi-automated ship-to-shore cranes., with which we were able to move the driver from the crane to the office. We are working to use technology to make work easier and safer for our workforce. We are in the process of introducing new systems like OCR; more importantly, we are training people and finding more staff to oversee these systems and analyze and process information. The biggest challenge is keeping up with technology and making sure people can keep up alongside. In MIT, our team believes technology will help them, not replace them. We have new systems to make things more effective while also keeping in mind the social aspect. You also need to provide good jobs to the community—there is a balance.

How has your company’s approach to corporate social responsibility (CSR) impacted both the external community and its employees?

When working on CSR, a company typically focuses on the outside community; however, you also have to take care of the community within. One of the things we did with the MIT Green Run and the Proyecciones Folkloricas is to get MIT people to participate in community activities volunteers. We started this project about six years ago, and it has been a great success because our people are able to experience how the company is positively impacting the community. We also develop community farms in schools and have brought in people from the Ministry of Agricultural Development in Panama to teach people how to plant seeds and take care of chickens for eggs. We were asked to prepare a garden for a jail, and it has since started to grow produce. A year later, we partnered with a university in Colón to teach people personal skills, how to prepare a resume, how to prepare a marketing plan and analysis, and more, once they come out of jail. If we get one of these people to be successful and not incur crime again, this will be a significant gain for the whole community. We are also working on a project along with the Ministry of Education. The program aims to help MIT employees to complete their bachelor’s degrees, and we encouraged many of our talented technicians to join and acquire their degrees. We now have employees who graduated under that program and whose mentors were MIT volunteers. Most of them even sought to carry on with their studies. Some 65% percent of our budget in Colón for social responsibility is dedicated to children’s education, and we equip schools with labs and tools as well as develop sports programs. We also partner with Sumarse and other foundations as well as film festivals. We are extremely pleased with our efforts thus far.

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