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Singapore Maritime Lecture

"Future challenges of international shipping and IMO"

April 25, 2012

Singapore Maritime Lecture
"Future challenges of international shipping and IMO"
By Koji Sekimizu
Secretary-General, International Maritime Organization
25 April 2012
 
Your Excellency Mrs Josephine Teo, Minister of State
Ministry of Finance and Ministry of Transport,
Ambassador Seet-Cheng,
Chief Executive of the MPA,
Ladies and gentlemen,
 
It is an honour, a privilege and a great pleasure to be with you today. The prestigious Singapore Maritime Lecture provides a significant platform to share views on key issues pertaining to the maritime world and I am grateful that you have invited me to avail myself of that opportunity today.
 
This is indeed a challenging period for the maritime community. That might seem like a statement of the obvious but I think it bears repeating. The commercial well-being of shipping is directly related to a global economy that continues to struggle, hampered by the problems in global finance that have beset the world in recent years.
 
To compound this rather bleak underlying commercial picture, as so often seems to happen, the demand for shipping services is weakening at a time when supply of vessels is at a high level. This is the cyclical nature of shipping. Those who rushed to order ships in the pre-2008 boom may be, today, questioning their decisions; but hindsight, as we all know, is a wonderful gift.
 
IMO, too, faces a number of significant challenges. As a specialized agency of the United Nations, it is the global standard-setting authority for the safety, security and environmental performance of international shipping. Its main role is to create a regulatory framework for the shipping industry that is fair and effective, universally adopted and universally implemented.
 
In other words, to create a level playing-field so that ship operators cannot address their financial issues by simply cutting corners and compromising on safety, security and environmental performance. This approach also encourages innovation and efficiency.
 
IMO’s sphere of influence has broadened significantly since it was founded, in 1949, and became operational, in 1959. Then, it was all about safety. Today, environmental, legal and other issues all form important parts of the Organization’s work. But, for me, safety will always be the core function of IMO and the main concern that keeps driving us forward. We strive constantly to deliver an international regulatory structure that ensures shipping remains safe, secure, efficient and environment-friendly.
 
To this end, one of my objectives as Secretary-General is to improve the delivery mechanism in the Secretariat as we seek to address newly emerging priorities and an ever-increasing workload. I refer, in particular, to the new demands upon the Organization from high-level policy concerns.
 
This will require effective human resource deployment, the creation of new, pro-active and transparent ways of handling our work, as well as improvements to our existing working methods. It will also require close co-operation between the Secretariat and Member Governments to implement the tight expenditure controls requested by the IMO Council. I have already made various changes in the senior management to support me in meeting the budgetary challenges and in leading to a forward-looking Organization. I have every confidence in the management qualities of my senior colleagues and in the abilities of all IMO staff, all of whom are fully committed to play their part in an efficient and cost-effective Secretariat, as expected by the Membership.
 
Underlying all of this is the need to make sure that shipping continues to be regulated by international standards, adopted by consensus where possible and applied universally. Regional or unilateral regulation of such a truly international industry is simply not in anyone’s interest.
 
The specific challenges we face alter and develop over time, as we respond to changes in shipping and in the global context. In 2012, for example, we are still heavily engaged in tackling piracy;  in ensuring effective implementation of the energy efficiency measures for ships that we have already adopted; in developing appropriate market-based measures as a contribution of shipping to the global debate on GHG and climate change; in the introduction of the IMO audit scheme as a mandatory measure; in achieving a sustainable, long-term financial basis for the World Maritime University; in continuing to offer, and deliver, meaningful and effective technical co-operation and capacity building; plus, of course, all the many other and various technical issues that arise during the course of IMO’s work.
 
I should now like to focus on one or two of those challenges that are currently of particular importance for IMO and seem to remain high on the agenda for some time to come.
 
***
 
Even before the Costa Concordia incident made headlines all around the world, safety at sea was always going to be in sharp focus for IMO during 2012. Now, in the wake of that incident, and others that have followed, safety will feature even more prominently.
 
Given the truly international composition of the Costa Concordia’s passengers and crew, the Italian authorities have agreed to my request to allow IMO to be represented as an observer on the body overseeing the casualty investigation in order to monitor progress closely and remain abreast of emerging issues, as they arise. I have also added an item on Passenger Ship Safety to the agenda of the Maritime Safety Committee, to provide an opportunity for IMO Member Governments to consider any related issues.
 
The whole world awaits the investigation into the Costa Concordia incident – and IMO is the right place to learn the lessons from the incident and ensure they are acted upon. 
 
The Maritime Safety Committee will receive key information from the casualty investigation as soon as possible, and will prepare and swiftly adopt any new measures through a “Fast Track” approach, meaning adopt possible amendments and complete the implementation of operational measures within a year.  I am sure that the cruise industry will be eager to promptly implement new measures even without formal adoption, entry into force and enforcement by Member Governments. 
 
The Maritime Safety Committee would also update its work programme to reflect the experience gained and lessons learnt from the Costa Concordia incident in setting future standards for the new generation of cruise vessels.  After all, the Committee’s long-term project is always to improve the safety for new generations of ships.
 
This year also marks one hundred years since the sinking of the Titanic, in which more than 1,500 people perished in the freezing waters of the North Atlantic, transforming what was then the world’s most celebrated ship into a name forever associated with disaster.
 
Many ships have sunk – too many – although few, if any, have had the long-lasting impact of the Titanic on the safety of ships.
 
The Titanic disaster prompted the major shipping nations of the world, at that time, to take decisive action to address maritime safety. It led to the adoption of the first international convention on safety of life at sea, SOLAS, in 1914.
 
IMO itself can trace its roots back to the Titanic disaster and its aftermath, in which the requirement for an international standard-setting body to oversee maritime safety became apparent; and safety at sea remains the core objective of IMO.
 
But each new generation of vessels brings fresh challenges and, even today, accidents still occur, serving to reinforce the need for continual improvement. Our efforts to promote maritime safety and, in particular, to avoid such disasters befalling passenger ships, will never end, and  I  repeat my call to IMO Member Governments, and the shipping industry as a whole, to refresh their determination to improve and enhance the safety of passenger shipping today, and into the future.
 
In the centenary year of the Titanic incident, I had proposed to hold a Ship Safety Symposium at the IMO to explore ways towards future of ship safety. 
 
But in the wake of the Costa Concordia, I have decided to postpone the Symposium.  We cannot embark on the future before we have settled the current safety issues at hand.
 
The future of ship safety would depend on:

• a more scientific approach,
• a systematic analysis of casualty data,
• new technology and innovation, and
• a holistic approach to address both operations and dependence on technology, recognizing a ship as a man-machine system. 
 
This would require rigorous participation by Government regulatory authorities, the industry, classification societies and academics.
 
I am optimistic that we can expect an early settlement of the present very serious regulatory actions as a result of the Costa Concordia incident.  Then, we can begin the process of exploring the future of ship safety next year at the postponed Ship Safety Symposium.
 
The Titanic led to the 1914 SOLAS Convention. We may develop a new framework of ship safety for the 21st century in the coming years.
 
***
 
All transport industries – shipping included – are under pressure to play their part in the reduction of greenhouse gas emissions. As the shipping industry’s regulatory authority, this is something in which IMO has been engaged for some time, and with considerable success.
 
Nobody here today – indeed, nobody in the shipping community – can be unaware of the breakthrough adoption, in July 2011 at IMO’s Marine Environment Protection Committee (MEPC), of mandatory technical and operational measures to reduce greenhouse emissions from international shipping. The new regulations will (among other things) make mandatory the Energy Efficiency Design Index, or EEDI, for new ships, which, in essence, requires new ships to be designed to be inherently more energy efficient. The regulations are expected to enter into force on 1 January 2013.
 
From a political perspective, this has not been the easiest of measures for IMO Members to adopt – far from it. And this is neither the time nor the place to go back over those difficult political complexities.
 
I would encourage the shipping industry to look beyond the political debate and to see EEDI as a wonderful opportunity. The regulations that make EEDI mandatory are non-prescriptive: which means that, as long as the required energy-efficiency level is attained, ship designers and builders are free to use the most cost-efficient solution or solutions for each particular ship. I see this as a green light for innovation, imagination and blue-sky thinking – the opportunity to develop a new breed of super-efficient ships that will be better for the environment, better for the economy and better for the shipping industry.
 
I believe that apart from the current debate on Climate Change at the UNFCCC, the shipping industry should make progress towards exploring a new generation of energy efficient ships.
 
This road towards energy efficiency is a long way towards the future.  It will come in the coming decades. Every company and the industry as a whole must proceed towards a more energy efficient mode of operation, and the IMO’s EEDI provides a sound framework for industry-wide efforts.
 
I am sure that the industry will see economic benefits of applying the EEDI and will do so. But in order to support the industry, I think Governments will play an important role. Governments should establish incentives and award schemes for companies that would make significant investments towards energy efficiency. 
 
For its part, IMO continues to work on the development of so-called market-based measures. Significant progress was made at the MEPC earlier this year and I am eagerly expecting further constructive discussions at its next session, so that we can start a formal Impact Assessment after that meeting this autumn.
 
There remain differences and divergence in opinion among IMO Member Governments on this issue. As a way forward, I have urged that efforts should be concentrated on constructive development to find a solution based on common ground. This requires real creative action with a sense of co-operation and a spirit of compromise to invent a new and practicable way forward. I am under no illusion that this will require significant effort from all parties involved, but I also have tremendous faith in the co-operative and collaborative process that has served IMO so well throughout its history.
 
***
 
While on the subject of environmental matters, I must make mention of the UN Conference on Sustainable Development, Rio +20, which will take place in Rio de Janeiro in June this year. That event will be of vital importance to everybody, including IMO and the shipping industry.
 
Just as the original Earth Summit in Rio led to valuable and effective work by IMO in support of the so-called Agenda 21 that emerged from that meeting, we are now supporting the Rio +20 process and creating our own way forward for shipping in the context of sustainable development.
 
Rio +20 will discuss the green economy and the institutional framework for sustainable development. Through its regulatory and technical co-operation work, IMO will play a critical role in promoting environmentally sound and sustainable shipping. IMO, in my view, provides the ideal institutional framework for sustainable maritime development and, in this context, I do not believe an additional international body is required. Such issues can, and should, be addressed at IMO and, at Rio +20, we will take the opportunity to clearly state the importance of shipping to sustainable development.
 
Given the fundamental role of shipping in international trade, the sustainable development and growth of the world economy are not possible without sustainable development and growth in the shipping and maritime industries. But the model for a sustainable maritime transportation system must be established by collaboration between Governments, industry and the global community.
 
When addressing sustainable maritime transportation system, we must be conscious about potential risks and possible impediments, such as, for example:
 
• overregulation, and in particular regional or unilateral measures for ships;
• maritime security threats, including that of piracy;
• the shortage of competent seafarers;
• improper maritime traffic management;
• a lack of, or insufficient, maritime infrastructure such as ports and terminals, intermodal connections, vessel traffic management and maritime zone monitoring and control systems;
• pollution and ineffective ballast water control; and
• a lack of coordinated maritime transportation policies.
 
I believe it is vital to establish a coordinated approach for sustainable maritime development, an approach that should be underpinned by the principles of global standards, energy efficiency, new technology and innovation, maritime security, maritime traffic management and maritime infrastructure development.
 
Under such a concept, Governments, whether in developed, emerging or developing countries, the shipping and maritime industries and the world community should work together to make the necessary investments and take the necessary actions to support the future of the maritime transportation system and ensure that shipping can continue to be environment-friendly, properly supported and protected from security risks.
 
The Maritime Singapore Green Initiative, which seeks to reduce the environmental impact of shipping and related activities and to promote clean and green shipping in Singapore is a good example of this kind of thinking in action. With its three distinct strands – the Green Ship Programme, the Green Port Programme and the Green Technology Programme, this is a comprehensive initiative which shows how coordinated policies in different areas can be mutually beneficial and yield valuable synergies.
 
***
 
I mentioned just now that shipping needs to be protected from security risks and, in this context, I must say a few words about the most urgent of those risks at the moment – piracy. Although piracy continues to plague shipping, and place the lives and livelihoods of seafarers at risk, there are clear signs emerging of progress in the fight to combat this insidious criminal activity, and of a gathering understanding that a coordinated response, across several different fronts, is the only way that overall success may eventually be found.
 
As the specialized agency of the United Nations with a responsibility for the safety and security of international shipping, IMO has been among those actively advocating and working towards just such an approach. This is based on our long involvement in combating piracy, not just Somali-based but in other parts of the world too.
 
For example, and as the maritime community in Singapore will be very aware, IMO was instrumental in establishing the framework for collaboration among the littoral States of the Straits of Malacca and Singapore and the South China Sea, a framework that has proved so successful in helping to almost eradicate piracy in what used to be the world’s major hotspot.
 
IMO has built on its experience in combating piracy in Asia to address the situation off Somalia.  The Regional Cooperation Agreement on Combating Piracy and Armed Robbery against Ships in Asia (ReCAAP) was the first regional Government-to-Government agreement to promote and enhance co-operation against piracy and armed robbery. ReCAAP entered into force in 2006 and many of the positive lessons learned from it are now incorporated in the Djibouti Code of Conduct, which is providing a framework for information sharing, review of national legislation, training and capacity building in the region affected by Somali piracy, and is working alongside other important initiatives such as the EU Critical Maritime Routes Programme.
 
In November 2011, the ReCAAP Information Sharing Centre signed an agreement with the three Information Sharing Centres set up under the IMO-led Djibouti Code of Conduct.  The agreement established a set of standard operating procedures for communication and exchanging piracy-related information and will result in a major expansion of the reporting area of such incidents.
 
Aside from the Djibouti Code, IMO has worked in many ways to strengthen the protection of persons, ships and cargoes in piracy-infested areas and also preserve the integrity of shipping lanes of strategic importance and significance.
 
Since the beginning of this year, I have met with UN Secretary-General Ban Ki-moon on a number of occasions to discuss how we can strengthen capacity building for anti-piracy activities. Mr. Ban agreed that capacity building in Somalia and neighbouring countries should be enhanced through co-operation between and among IMO and the UN, UN specialized agencies and other relevant international organizations, founded on IMO’s existing capacity-building activities under the Djibouti Code of Conduct. With his encouragement and support, we are now preparing a number of important events next month. 
 
First, IMO will be hosting a high-level meeting on 14 May, to review the progress being made towards implementation of the Djibouti Code.
 
Then, on 15 May, an IMO Conference on capacity building to counter piracy off the coast of Somalia will be held, and I will use that occasion to invite all UN agencies and the EU to agree on  how we can strengthen our co-operation in capacity-building efforts.
 
And on 16 May, we are holding a high-level segment of IMO’s Maritime Safety Committee to discuss the many facets of the issue of arms on board merchant vessels. IMO’s traditional position has been that this is a matter for individual Governments and shipping companies to decide upon. However, there are a number of issues related to the deployment of armed personnel on board ships which, although they have been considered previously by the Committee, require further consideration if practical solutions are to be found and appropriate information and guidance are to be promulgated to those affected.
 
At the High-level segment of the MSC, we will need to discuss a number of important policy issues.  We will need a high-level policy debate on a wide range of legal and practical issues. These include:
 
• How to regulate security guard providers;
• The issue of innocent passage;
• The transfer of weapons;
• How to handle and treat weapons in Ports;
• The authority of the ship Master;
• The rules of engagement;
• Certification for security guards providers; and
• Whether such matters should be left to national regulations, industry self regulation or international regulations.
 
All of these will be the subject of debate during the High-level segment of MSC on 16 May, and I am confident that this will provide a good opportunity to form an international consensus on the issue of arms on board and enable our battle against Somali piracy to step forward.
 
Looking further afield, IMO plans to create a Regional Co-operative Mechanism for the protection of the Southern Shipping Lanes in the Western Indian Ocean. The main effort of the naval forces engaged in countering piracy is, quite rightly, focused on the Gulf of Aden and the Arabian Sea. As a result, ships operating in the south-western Indian Ocean and the Mozambique channel have little guarantee of protection from international naval forces against pirates. There are, however, significant existing and emerging threats to maritime security in this area.
 
The "protection of the southern shipping lanes" initiative is aimed at combining counter-piracy and maritime capacity-building projects within one single overarching apparatus, to deliver a programme for the development and protection of the maritime domain in the south-west Indian Ocean. The aim is that the signatory States to the Djibouti Code of Conduct will work together, supported by IMO and other development partners, to create a regional co-operative mechanism to this effect.
 
IMO will also continue with its capacity-building programme in the region in support of core objectives under IMO competence, for example the enhancement of maritime safety and the development of search and rescue facilities, and of maritime situational awareness.
 
Considerable emphasis is now being placed by IMO on capacity building to enable full implementation of the Djibouti Code to be achieved. This was noted, and encouraged, in the communiqué adopted by the conference on Somalia that took place in London in February.
 
The word “Somalia”, in a maritime context, leads almost exclusively to thoughts of piracy. And yet, as has been so clearly highlighted, piracy is but one manifestation of the widespread and deep-rooted problems that beset that country and its people. Piracy is a symptom; and, while a symptom can be treated and its effects can be alleviated, real progress can only be made by addressing the cause.
 
***
 
What we now see emerging is a wider programme of activity, motivated initially by security concerns but now reaching into other areas. Here in Singapore, it is particularly appropriate to reflect on how initiatives aimed primarily at enhancing maritime security can, in fact, yield beneficial and far-reaching impacts across a much broader canvas.
 
It was, in the first instance, concerns over piracy that prompted IMO’s Protection of Vital Shipping Lanes initiative.
 
This, in turn and at the end, led to the launch of the Co-operative Mechanism on the Safety of Navigation and Environmental Protection in the Straits of Malacca and Singapore, in September 2007. Since then, the littoral States, user States and the international shipping community have made significant strides, co-operating on matters such as navigational safety and environmental protection in this critical trade route.
 
At the moment, the three littoral States, together with the shipping industry, are carrying out two major initiatives: a review and enhancement of measures implemented in the Straits, as well as a directory of port reception facilities in the Straits. The inputs of user States and the international shipping community would be valuable in ensuring the best possible outcome in the review. Similarly, the 5th Co operation Forum and Project Coordination Committee Meeting will be hosted by Singapore in September this year, and I know that the continued, and active, participation of the user States and stakeholders in the Straits of Malacca and Singapore is important to sustain the momentum of this important platform and, in particular, in the context of moving forward towards the establishment of the Marine Electronic Highway system in the Straits.
 
***
 
Ladies and gentlemen, I should like to conclude by saying a few words about the human element in shipping: in particular the 1.5 million seafarers who operate the world’s fleet, bringing cargo safely to its destination, keeping to the schedules, day in and day out, regardless of the conditions they may have to face.
 
I take this opportunity to remind you that the 25th of June marks the annual Day of the Seafarer. It gives us the opportunity to focus once again on how important these unsung heroes are to all of us, in our everyday lives, and to reflect on just how much we rely on their services.
 
Almost 90 per cent of world trade is transported by sea, in ships. Ships carry food, fuel, raw materials, commodities and goods on which we all depend. Seaborne trade facilitates the global economy and it is no exaggeration to say that almost everything we touch has, at some point in its existence, been transported by sea or derived from something that was transported by sea.
 
We acknowledge the seafarers who operate the ships, bringing cargo safely to its destination, keeping to the schedules, day in and day out, regardless of the conditions they may have to face. Without seafarers, our lives cannot be sustained. Yet, to most of us, seafarers are virtually invisible.
 
The life of a modern seafarer can be dangerous and lonely. They may spend up to a year away from home, separated from their family and loved ones and facing danger, isolation, loneliness and the threat of piracy.  And, we rely on seafarers for almost everything we eat or use in our daily lives.
 
I pay tribute to the world’s 1.5 million seafarers for the unique and all-too-often overlooked contribution they make to the well-being of all of us. 
 
As we thank today’s seafarers, it is worthy of note that, to meet the growing demands of the world trade and the needs of the shipping and related industries, some 20,000 additional trained officers are required every year. To this end, in recognition of the vital role those seafarers will continue to play, I request shipowners to meet their aspirations through providing comfortable accommodation, access to the internet and other facilities that we all take for granted ashore in the 21st century.
 
At the same time, flag States and port States should promote their fair treatment and Training Providers and Educational Institutes should ensure that young people are trained effectively so that they can perform well on board ships.
 
I would also like to take this opportunity to send a message to all young people on the verge of choosing a future career to seriously consider seafaring - even today it provides the chance to see the world and get paid for doing so!
 
More importantly, it also provides for a fulfilling and rewarding professional career either as a lifelong seafarer or as a springboard for related professional jobs in the maritime industries ashore. So, my message to young people of the world is: please enrol in Maritime Academies and Training Institutes, and join the world of seafarers.
 
In this context, I would also urge Governments and the shipping industry to continue providing training opportunities for the younger generation.  Without seafarers, shipping cannot be sustained and the future of the industry depends on your action now to provide ample opportunities for education and training for future generations of seafarers.
 
***
 
And, I think my speech finally comes to the point where I say: thank you, ladies and gentlemen, for listening so attentively. My thanks go also to the Maritime and Port Authority of Singapore for giving me the opportunity to speak to you today. I began this speech by referring to some of the challenges that all of us who are involved in the maritime community face today. Let me conclude by reaffirming my belief that, if we work collaboratively and constructively, we have the ability, and the collective strength, to face them, and to solve them. As I stated at the IMO Assembly last year, we are facing difficult and challenging times.  But, if we work together, we can create ample opportunities and we can turn the times of difficulty into the times of solutions.
 
Thank you.
 
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