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Trade Facilitation – Impossible Trade Facilitation – Impossible Without Facilitating LogisticsWithout Facilitating Logistics
Simon BennettSimon BennettSecretary, International Chamber of ShippingSecretary, International Chamber of Shipping
WTO Forum, Geneva,WTO Forum, Geneva,25 September 2008 25 September 2008
Presentation outlinePresentation outline
Introduction to international shipping - carrier of 90% world trade
Obstacles to efficiency of shipping
The need for successful conclusion to WTO facilitation negotiations
Introduction to international shipping - carrier of 90% world trade
Obstacles to efficiency of shipping
The need for successful conclusion to WTO facilitation negotiations
What is ICS?What is ICS? Principal international trade
association for shipowners
Representing shipping at international regulatory level – especially International Maritime Organization
Also all other inter-governmental bodies impacting on shipping e.g. World Customs Organization, OECD, United Nations
Principal international trade association for shipowners
Representing shipping at international regulatory level – especially International Maritime Organization
Also all other inter-governmental bodies impacting on shipping e.g. World Customs Organization, OECD, United Nations
ICS members are national shipowners’ associations
Passenger ships
ICS represents all ship types and trades and 75%of world merchant fleet
Bulk carriers
Tankers
Passenger shipsContainer ships
International shipping – lifeblood International shipping – lifeblood of world trade of world trade
90% world trade carried by sea
Without shipping, intercontinental trade, bulk transport of raw materials and affordable food would not be possible
Low cost and efficient transport has permitted shift of production to Asia, raising global living standards
90% world trade carried by sea
Without shipping, intercontinental trade, bulk transport of raw materials and affordable food would not be possible
Low cost and efficient transport has permitted shift of production to Asia, raising global living standards
One tonne iron ore
Typical shipping cost
Australia - Europe
$US 20
One gallon of petrol at the pump
Typical shipping cost
Arab Gulf - US
(crude)
$US 0.015
Bottle of whisky
Typical shipping cost
UK - China
20 cents
Trade efficiency needs liberalised Trade efficiency needs liberalised shipping markets shipping markets
Preservation of OECD maritime principles- codification in WTO agreement on maritime services
Shipowners work closely with Consultative Shipping Group (CSG) of maritime governments
Need for traditional maritime nations to set example
Preservation of OECD maritime principles- codification in WTO agreement on maritime services
Shipowners work closely with Consultative Shipping Group (CSG) of maritime governments
Need for traditional maritime nations to set example
WTO facilitation negotiations WTO facilitation negotiations
Successful outcome will promote international standards and simplification of customs procedures
If other parts of Doha round do not succeed, means should be found of preserving progress on facilitation
Successful outcome will promote international standards and simplification of customs procedures
If other parts of Doha round do not succeed, means should be found of preserving progress on facilitation
Important obstacles to the Important obstacles to the efficiency of shippingefficiency of shipping
Regional regulation
Security – protecting the supply chain vs. keeping world trade moving
Can infrastructure keep pace with increasing trade volumes?
Regional regulation
Security – protecting the supply chain vs. keeping world trade moving
Can infrastructure keep pace with increasing trade volumes?
Regional regulationRegional regulation
Industry mantra – ‘global regulation for a global industry’
Shipping relies on international regulatory framework, not least through International Maritime Organization (IMO)
Importance of ‘level playing field’, fair competition
Industry mantra – ‘global regulation for a global industry’
Shipping relies on international regulatory framework, not least through International Maritime Organization (IMO)
Importance of ‘level playing field’, fair competition
Unilateral rules create market distortions, reducing efficiency of maritime transport and trade
New pressures with environmental rules – different standards in different ports means chaos
Major challenge -‘Post Kyoto’ CO2 regime, UNFCCC principle of ‘common but differentiated responsibility’
New pressures with environmental rules – different standards in different ports means chaos
Major challenge -‘Post Kyoto’ CO2 regime, UNFCCC principle of ‘common but differentiated responsibility’
Security versus facilitationSecurity versus facilitation
Balance between legitimate security concerns, and practicalities of maintaining efficient trade, shifted since ‘9/11’
Focus of debate at World Customs Organization (WCO SAFE framework)
Erosion of IMO Facilitation Convention standards
Balance between legitimate security concerns, and practicalities of maintaining efficient trade, shifted since ‘9/11’
Focus of debate at World Customs Organization (WCO SAFE framework)
Erosion of IMO Facilitation Convention standards
Challenges to facilitationChallenges to facilitation US Law for 100% container scanning
(not feasible, unfair on trading partners)
Implementation of EU cargo security rules (potential IT chaos)
Proposed China cargo security regime
Restrictions on movement (and shore leave) for seafarers
US Law for 100% container scanning (not feasible, unfair on trading partners)
Implementation of EU cargo security rules (potential IT chaos)
Proposed China cargo security regime
Restrictions on movement (and shore leave) for seafarers
Keeping pace with the growth of Keeping pace with the growth of maritime trademaritime trade
Source: Fearnley's Review
Port infrastructure and hinterland Port infrastructure and hinterland connections under serious strainconnections under serious strain
Not keeping pace with maritime growth, requires big investment
Serious congestion e.g. US West Coast, North West Europe, may impact on economies as a whole
New demand for improved efficiency throughout supply chain to help reduce CO2
Not keeping pace with maritime growth, requires big investment
Serious congestion e.g. US West Coast, North West Europe, may impact on economies as a whole
New demand for improved efficiency throughout supply chain to help reduce CO2
Integrated transport policies Integrated transport policies Need for co-ordination between policy
makers to reconcile conflicts between trade and environment, e.g. port expansion and multimodal connections
Threat to wider economy needs to be understood. Maritime transport ‘out of sight, out of mind’ – needs often neglected by policy makers
Need for co-ordination between policy makers to reconcile conflicts between trade and environment, e.g. port expansion and multimodal connections
Threat to wider economy needs to be understood. Maritime transport ‘out of sight, out of mind’ – needs often neglected by policy makers
The shipping industry has much The shipping industry has much to gain from WTOto gain from WTO
Services negotiations – codifying existing free practices
Trade facilitation agreement – locking in customs ‘best practice’ and
Reinforcing facilitation work carried out in other bodies – WCO, IMO FAL
Promotion of e-commerce and ‘single window concept’
Services negotiations – codifying existing free practices
Trade facilitation agreement – locking in customs ‘best practice’ and
Reinforcing facilitation work carried out in other bodies – WCO, IMO FAL
Promotion of e-commerce and ‘single window concept’
ConclusionConclusion
Proper consultation with trade means better legislation and results
WTO facilitation efforts can promote international standards – vital for global shipping industry and efficient world trade
Proper consultation with trade means better legislation and results
WTO facilitation efforts can promote international standards – vital for global shipping industry and efficient world trade
Thank you Thank you
For more information visit
www.marisec.org
www.shippingfacts.com
www.marisec.org/icsfilm
For more information visit
www.marisec.org
www.shippingfacts.com
www.marisec.org/icsfilm