1. Trade Facilitation – Impossible Without Facilitating Logistics
Simon Bennett
Secretary, International Chamber of Shipping
WTO Forum, Geneva,
25 September 2008

2. Presentation outline
Introduction to international shipping - carrier of 90% world trade
Obstacles to efficiency of shipping
The need for successful conclusion to WTO facilitation negotiations

3. 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

4. ICS members are national shipowners’ associations
Passenger ships

5. ICS represents all ship types and trades and 75%
Bulk carriers
Tankers
Container ships
Passenger ships
ICS represents all ship types and trades and 75%
of world merchant fleet

6. International shipping – lifeblood 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

7. One tonne iron ore
Typical shipping cost
Australia - Europe
$US 20

8. One gallon of petrol at the pump
Typical shipping cost
Arab Gulf - US
(crude)
$US 0.015

9. Bottle of whisky
Typical shipping cost
UK - China
20 cents

10. Trade efficiency needs liberalised 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

11. 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

12. Important obstacles to the efficiency of shipping
Regional regulation
Security – protecting the supply chain vs. keeping world trade moving
Can infrastructure keep pace with increasing trade volumes?

13. Regional 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

14. 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’

15. Security 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

16. Challenges 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

17. Keeping pace with the growth of maritime trade
Source:
Fearnley's Review

18. Port infrastructure and hinterland connections 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

19. 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

20. The shipping industry has much to 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’

21. Conclusion
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

22. Thank you For more information visit www.marisec.org