Analysis
18/5/2012

Watchkeeper: Good news for short sea?


For very many years, operators of ships running in short sea trades around Europe have pointed to the obvious disparities in the level of bureaucracy they have been forced to endure when taking cargo across an “internal” EU border and the freedoms enjoyed by road hauliers. They point to the lack of any sort of controls at the land frontiers after these were dismantled, and the absence of the cumbersome procedures truck drivers were once forced to endure. They point to the obvious speed advantages this facility provides, where once drivers were forced to queue, sometimes for hours, when the customs posts were in operation.

Then they indicate the obvious absurdities of the port arrival and departure procedures which still attach to ships, much as they always did, for decades before the European Union was ever dreamed of. Laborious procedures and largely pointless (if traditional) paperwork, involving thousands of man-hours, have to be paid for somewhere along the line and must, in the final analysis, put up the price of sea carriage by a substantial margin. And they will usually round off their arguments by noting the environmental benefits that ships do provide, by taking truckloads of goods off crowded roads.

It is good to note that there is movement taking place in the European Commission, where the problems of short sea shipping and the need to boost the sector have been recognised. Clearly the situation has been greatly improved by the advent of technology and the ability to be able, through AIS, to know where ships are at any one time. This has effectively removed the concerns of Customs authorities that a non-EU wayport might intervene between an EU departure and arrival.

Even more positive was a progress report by Dimitrios Theologitis, Head of Unit Ports and Inland Navigation in DG Move at the European Commission, who said that his department was working hard to do away with the ship procedures which so disadvantaged intra-European sea transport. Speaking last week at the 2012 ESPO Conference at Sopot in Poland, Mr. Theologitis said that a pilot project, which anticipated intra-European trade would be in a “Blue Belt” permitting substantial freedoms from procedures, was being evaluated and the results would soon be revealed.

No doubt about it, this reform would be widely welcomed and if implemented around the European seaboard in the “Blue Belt”, could do a great deal to help to revitalise European shipping and assist in the desperately needed growth that will revive European economies. In his review of current efforts at DG Move, Mr. Theologitis suggested that faced with the need to promote growth, the emphasis was on wide consultation over policies rather than the imposition of these in a prescribed fashion. “We don’t want to break what works well”, he said, and while there was a need to ensure that public money provided for ports was well spent, the question “is there a need for intervention?” was more readily asked.

This was an encouraging address, focusing on growth and efficiency, although any satisfaction needs perhaps to be tempered by the concerns at rising costs from environmental constraints, such as those on atmospheric emissions, which are likely, say short sea ship operators, to penalise them in another direction and force traffic hard-won from road haulage back onto the trucks again.

Source: BIMCO

Analysis

The freight rate war currently taking place between Asia and Europe, and between Asia and the US, and the further addition of new ships, will force carriers to resort to more slow steaming.
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