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The first web2.0 spanish blog about Maritime Affairs. El primer blog web2.0 español sobre el sector marítimo.

BIMCO Conference on Future Maritime Policy for the EU –the International Perspective The Industry View: BIMCO’s view on the Future Maritime Policy

 15 November 2006, Brussels. Speech by Mr. Knud Pontoppidan , from BIMCO

[BIMCO, established in Denmark in 1905, is the world's largest international shipping association, with approximately 2,400 members in 123 countries. The owner-members of BIMCO control a fleet of about 525 million DWT thereby representing 65% of the world's merchant fleet. BIMCO is accredited as an official observer at the International Maritime Organization (IMO). Among its many activities, BIMCO provides practical information and assistance to the maritime community.]

Shipping is and has always been an important production factor. It has served as the basis for global trade, and it has contributed to the present wealth of the world. Also, Europe owes much of its wealth to the availability of safe and efficient shipping services. This is evidenced by the fact that major European cities and most financial centres are located at places that have easy access to the sea. Shipping has also connected Europe to the rest of the world and made international knowledge available to the European countries - and vice versa.

An example of this is that great European navigators, who travelled the oceans in past centuries, often did so in the path of other great seafarers from non-European countries. One of these was the Chinese Zheng He, who according to some researchers, charted the Americas years before the first Europeans did so, and whose charts in turn are believed to have assisted Christopher Columbus on his voyages.

This interconnectedness and sharing of knowledge should continue. The EU should not limit the development of its maritime policy by ignoring international knowledge and expertise. We therefore encourage the idea that a future maritime policy for the EU links to the international maritime heritage of the EU countries, and at the same time increases awareness of the importance of shipping, in a historical context as well as a foundation for the present wealth.

With this in mind we turn now to the first question in the Green Paper, “Should the EU have an integrated maritime policy?” That question must be answered with a resounding “yes”. BIMCO hopes that the development in the EU of an overarching holistic policy for the oceans will contribute to the development of better co-ordinated and detailed policies for the individual industries and stakeholders that mutually depend on the maritime environment.

We see 5 main goals in the Green Paper. Some we can identify with, others not so much.
Retaining Europe’s leadership in sustainable maritime development;
Maximising the quality of life in coastal regions;
Providing the tools to manage our relations with the oceans;
Maritime governance; and
Reclaiming Europe’s maritime heritage and reaffirming its maritime identity.

In BIMCO’s opinion, a sixth goal should be added to this list, namely “achieving the goals set out by the Future Maritime Policy through international regulations”.

This brings us to my first fundamental point. We believe that the future maritime policy will only have a truly worldwide dimension and encompass all vessels that call EU or transit EU waters if the maritime policy is grounded in international agreements and conventions such as those drafted by the IMO, UNICITRAL and ILO.

In this regard, we would like to point out that many of the ambitions set out by the Green Paper can be achieved through ratification and implementation of existing international instruments. We believe in international solutions. We believe in maintaining and ensuring viable international instruments.

And for that reason we believe that the EU should be careful not to tamper with long-held principles established in UNCLOS, such as the right of innocent passage. BIMCO was therefore also concerned to note the proposed notification requirement found in the recent LLMC directive. We would prefer efforts aimed at keeping UNCLOS intact as a global instrument governing the seas. At any rate, discussions about or related to UNLCOS should take place at the appropriate international level.

However, at the same time, while we praise the advantages of international conventions, we feel that it important also to recognise the disappointing fact that of the 56 IMO approved Conventions, the EU countries have on average ratified only 37. The very best result of an EU country is the ratification of 48 out of the 56 IMO conventions. The very worst result is 15.

A particularly poor ratification rate pertains to the international convention that controls the use of anti-fouling systems on ships -that is toxic paint. In colloquial language, it is called the AFS convention. As of October 2006, only seven EU countries had ratified the AFS convention. This is a surprising development. The EU countries have their own regulation that, to all intents and purposes, is a copy of the international AFS convention, and the argument at the time when the regulation was first put forward was that it would lead to a more speedy ratification of the AFS convention. This has not happened.

One may ask why EU countries are not ratifying IMO instruments. Why do the EU countries prevent a worldwide improvement of the marine environment, safety at sea and the health of seafarers? In this regard, we believe that EMSA could play a key role. EMSA should encourage and assist Member States in their implementation of international conventions. In part to actually ensure ratification, in part to ensure a harmonised application of the international rules among all EU countries.

Despite our strong preference for international solutions, we recognize that there may be some issues which international solutions cannot adequately address, and which the Commission and the EU countries have to address on a regional level. As such, BIMCO appreciates that regional considerations must often be included in a policy formulation process, whether in relation to environmental, social, commercial or recreational considerations. What must be observed, however, is that the maritime transport industry has to be able to operate smoothly in all regions. For this reason it is imperative that the international context of regional regulations that affect the shipping industry are always borne in mind, and that regional considerations resolved through legislation are promulgated via international channels and instruments.

Now I would like to share with you my second fundamental point, which is about Coastal States. BIMCO believes that the Future Maritime Policy should promote the concept of Quality Coastal State. Why a Quality Coastal State? -because the role of coastal States appears to have been ignored. Other stakeholders in the transport chain such as flag States have continuously contributed in the enforcement of international regulations, but coastal States have been overlooked. It is therefore time to turn our attention to the role of the coastal State. Coastal States should here be understood in a broad sense to also include port states.

The monitoring of performance of ships and flag states is not a novel activity, and a great many statistics, mainly based on compliance with IMO conventions, are available. However, coastal States and their ratification, implementation and compliance with the very same conventions do not seem to be included in the statistics.

Quality Coastal States deliver essential services to ships, such as waste reception facilities, places of refuge, innocent passage and aids to navigation. Unfortunately, there seems to be a general lack of such commitment by some coastal States. Today, many coastal States seem to think that they have only rights and no obligations. I would like to provide you with an example.

None of the EU Mediterranean states have confirmed to the IMO that they are in compliance with MARPOL Annex V with regard to reception facilities. This is despite the fact that Annex V has been in force in the very same countries since 1988. This means that the Mediterranean Sea is not yet a Special Area under MARPOL Annex V. But nevertheless, all ships calling EU ports must comply -in full- with Annex V. Here we see a clear opportunity for the Future Maritime Policy to make progress and develop measurable criteria for Quality Coastal States.

For the industry a qualify coastal state is one that:
Fulfils its international duties and obligations by ratifying and implementing internationally agreed conventions. Here I am thinking not only of the implementation into national law, but also of the day-to-day practices within the coastal waters, at the ports and, last but certainly not least, in the courts.
Follows the IMO Guidelines such as the IMO/ILO Guidelines on the fair treatment of seafarers.
Provides adequate waste reception facilities and arrangements to protect the local marine environment and resources.
Maintains its aids to navigation and provides vessel traffic services, where appropriate.
Provides ships in distress with a place of refuge rather than risking environmental disaster by denying it.
Ensures that all steps are taken to facilitate the safe passage of ships through its waters, including making transit pilotage available free of charge without hampering innocent passage where transit pilotage is deemed necessary in the interest of the state.
Gives incentives to quality ships calling at its ports and/or navigating within its waters.

The EU could contribute significantly to the safe and environmentally friendly maritime transport chain by helping member states become Quality Coastal States, and by measuring and benchmarking their progress.

I would now like to elaborate further on two of the characteristics of a Quality Coastal State -places of refuge and accident investigation.

When it comes to Emergency response and Places of Refuge, BIMCO emphasizes the need to establish a decisive independent body which, based upon a factual assessment of the situation, can determine the most appropriate line of action in response to emergency situations. When a ship in distress has need of a place of refuge, it is important that provisions are in place so that the authorities can assess and respond to such situations without delay. The reason is that time is often of the essence with respect to saving lives and protecting the marine environment. After the incident it is important to conduct a maritime accident investigation in an unbiased and objective manner. It is our belief that this can only be achieved if a clear segregation of safety investigations from criminal investigations is established. The recent directive proposal on accident investigation does not safeguard this segregation. It is a major concern to BIMCO.

The establishment of a European Marine Observation and Data Network, as suggested in the Green Paper, could have merit. A centralised collection and access to information may provide certain efficiencies that would be shared across the board. Many stakeholders - both public and private - agree that data is needed. BIMCO currently maintains databases and is involved in information-gathering on many essential maritime topics. We are prepared to assist by providing information that would be useful to real and meaningful efforts aimed at improving maritime safety, environmental protection and special planning.

My next and third fundamental point is about port development -or should I say the lack of port development. An introduction of Green Ports and Green Port Development into the Future Maritime Policy will include initiatives to avoid the current obstacles to port development in the EU. Efforts to collect case studies that describe port development and which take into account protection of the environment would contribute to the development of guidelines that, when followed, would allow for expansion of port capacity whilst protecting the marine environment. And expansion is needed, as the EU will run out of container port capacity in a few years unless something is done.

Here there are overlaps with the concept of “Quality Coastal States”. There would also be overlaps in the real world, as most coastal states are also Port States. Ports such as Rotterdam have taken some steps towards providing incentives to ships based on environmental criteria. However, we feel that a more comprehensive approach could be applied.

For example, to qualify as a “Green Port”, such ports would have to demonstrate:
That they have adequate waste reception facilities and arrangements to protect the local marine environment and resources;
That they have incentives for “Green Ships”, and
That they have implemented MARPOL requirements and other international convention requirements.

The EP and Council initiative to encourage the establishment of Integrated Coastal Zone Management (ICZM) strategies amongst Member States may serve well in establishing more large ports in the EU in an environmentally friendly way. BIMCO looks forward to the evaluation of progress achieved with the ICZM initiative during 2006.

I would now like to provide you with some background as to why we prefer international rules and regulations -and what it means for shipping from a business perspective. We would like to encourage the EU to continue to support free trade and maintain an international level playing field, which is my forth key message. There are many ways that the EU can contribute to a competitive maritime industry.

One is to ensure that member states ratify and implement IMO, ILO and UNCITRAL instruments as a high priority. As a global industry, shipping benefits from harmonised international rules and regulations in order to facilitate the free flow of global trade. All shipping would otherwise suffer if subjected to a patchwork of disjointed regional or local regimes. An effective and competitive maritime sector remains an important production factor for European industry, supporting exports, imports, and economic growth. It also enhances employment opportunities for the European population. Steps to intervene and regulate international competition will often have detrimental effects on those who rely and depend on the access to cost-effective and safe transport. Healthy competition in an open market will result in increased efficiencies including, but not limited to, reduced transportation costs.

Hidden within the concept of a Common European Maritime Space, as suggested in the Green Paper, could be the creation of artificial regional competitive advantage schemes such as protectionist cabotage regulations. Such steps will not contribute to the overall competitiveness of European shore-based industries on the global market. Specific technical requirements or other non-tariff barriers driven by cabotage considerations will have similar detrimental effects. As an advocate of free trade, BIMCO cannot support initiatives that might result in closed markets or the establishment of trade barriers. Such moves would have an unfavourable effect on competition and result in higher transportation costs. Higher transportation costs would have negative effects on Europe’s competitiveness with regard to exports, and increase costs on imports of raw materials, components for manufacturing and consumer goods. None of this would help in the pursuit of the goals of the Lisbon Strategy. Furthermore, schemes which exclude certain vessels from carrying cargoes between member states may even be counterproductive to the thematic environmental objectives of the EU. Protected trade is often served by older, less efficient and less environmentally-friendly ships because in these protected trades there are no incentives to improve efficiency. This is a problem, because incentives are the driving forces towards achieving improved efficiencies in competitive trades.

Another serious aspect of a Common European Maritime Space that should be considered is the risk that the rest of the world might take similar action in other regions, with detrimental effects for all international shipping, including Europe’s. Already today, restrictions in relation to cabotage are a problem in some Member States. Therefore, the EU Member States that still impose cabotage regulations should open up trade possibilities for everybody. Perhaps to start with it should be based on reciprocity agreements that could be established with non-EU states until such a time as the efforts of the WTO have established true global free trade. It is important to stress, though, that when entering into reciprocity agreements, care must be taken with respect to the possible effects on the WTO trade negotiations and WTO agreements. I believe these concerns illustrate that the Commission should proceed in a careful manner when developing policy relating to the Common European Maritime Space.

For the same reason, the concept of Motorways of the sea could cause concern. BIMCO appreciates the efforts made to promote a shift of freight movements from Europe’s congested roads to the sea and inland waterways. On a per freight volume basis, marine movements of freight are more efficient both environmentally and economically. We suggest that the Commission’s efforts should focus on land/port infrastructure and not intervene in commercial shipping operation. It has been noticed that the majority of these projects are limited to regular services on EU-flagged ships. This raises concerns similar to those already mentioned relating to the introduction of cabotage and the subsequent potential distortion of competition.

The Green Paper is a comprehensive document, and time does not allow me to deal with all of its elements. But there are a few issues -in addition to those that I have already commented on- that deserve attention. The first one is ship recycling. The IMO is working on a legally-binding instrument on ship recycling -a new international convention. This is much needed by the industry. Today, the main issue relating to ship recycling is the absence of an instrument dealing specifically with ships. In this regulatory vacuum, attempts are being made to apply regulations that were not drafted to address our industry, and which therefore are incompatible with the reality of ship recycling. A future EU maritime policy should therefore ensure that the IMO initiative is actively supported and Member States should be encouraged to ratify it.It should also entail alignment with the IMO initiative, so that once the new legally-binding instrument on ship recycling enters into force, the current EU legislation is amended accordingly. Another way that the EU can help is through foreign aid in relation to the working conditions at recycling yards in the developing countries. EU foreign aid granted on the condition that the funds are used to improve working conditions and to enhance environmental protection at recycling yards in third countries will have a positive effect and alleviate some of these important concerns.

Another important issue that deserves special attention is maritime manpower. The BIMCO/ISF study on maritime manpower underlines the importance of recruitment, not least in the EU and other OECD countries with an aging work force. Initiatives to attract young men and women to the industry should be supported. The aim should be to make shipping more visible and to promote formal career and education paths. One of the major obstacles in attracting young people to a career path at sea is the absence of a career path that also leads back to shore.

One of the key environmental concerns of the day is air pollution. The forecasts in the green paper on air pollution from the shipping industry provide a great incentive to undertake new studies and initiatives in this regard. You will therefore be pleased to learn that BIMCO has dedicated significant resources to examine efficient and workable solutions to address concerns on air pollution. The shipping industry has continuously improved its environmental performance so that it is today the cleanest mode of transport of goods. Despite these achievements, the shipping industry remains committed to work towards minimizing the environmental impact of transport and is also committed to co-operate with the EU in the appropriate international fora. BIMCO believes that the best way to address concerns about air pollution from ships is through the development of lasting global solutions at the IMO, where the issue has already received significant attention, and where the global expertise is available. BIMCO has already identified several potential solutions. One solution could be to restrict the use of Heavy Fuel Oil to the high seas, so that ships would have to switch to distillate low sulphur fuel when approaching ports and Sulphur Emission Control Areas. Whatever solutions may be pursued, an impact assessments relating to such measures would be welcome and prudent.

To conclude, I would like to summarize with what we see as the key points to bear in mind as we move forward in developing a European Maritime Policy. We hope that the Commission will:
Agree to achieve the goals set out by the Future Maritime Policy through international regulations;
Develop the concept of the Quality Coastal State and the related roles and criteria to qualify;
Increase attention to port capacity challenges and the allocation of resources aimed at facilitating port expansion in an environmentally-friendly way;
Keep the flag of free trade flying high and avoid succumbing to protectionist forces;
Maintain appropriate stakeholder involvement in this process.

Let me close by saying that BIMCO appreciates the positive way in which the Commission is seeking to develop a holistic maritime policy for Europe.I hope that our contribution to this effort will be taken on board in the constructive way in which it is intended.

And I can assure you that our efforts to assist the Task Force and the Commission with this project will not end with today’s conference. We are with you to see this project through to its conclusion.


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