Panama Maritime XI
Opening Ceremony, 26 February 2013
By Koji Sekimizu
Secretary-General, International Maritime Organization
Ladies and gentlemen,
First of all, let me say how much I appreciate the invitation to participate in this conference. Over the years, the Panama Maritime event has grown to become one of the most important on the shipping industry’s calendar; an opportunity for leaders from all industry sectors to meet, to exchange views and to discuss the issues that are affecting everyone within shipping today.
It should come as no surprise to find that such an important maritime event has become established here in Panama. This is, after all, one of the major centres of the global shipping industry, home not only to the world’s largest shipping registry but also to one of the most pivotal shipping lanes, the Panama Canal.
This year’s conference comes at a time of great change. From Panama’s perspective, the Canal expansion programme is moving ahead and, as I have had the chance to see for myself during this visit, the work is at an advanced stage. Yesterday, I was taken on an air tour by helicopter and given an overview by Administrator Robert Linares. Today, Administrator Jorge Quijano took me down to the water channel of the Atlantic Lock. I walked through the channel of the lock to the Atlantic side. This massive investment is truly impressive and, of course, it reflects recent trends in shipping towards the economies of scale found in ever-bigger vessels.
If the Canal is in a state of transition then so too is the shipping industry. This has always been a cyclical industry and recent years have proven no exception. During the super profitable period that shipping enjoyed in the mid-2000s, a massive amount of new tonnage was ordered. But the arrival of this new tonnage on the market coincided with the financial crisis and subsequent trade downturns. Shipping is facing a difficult time, but this is nothing new.
Shipping has always been a cyclical industry. Clearly, a period of consolidation and adjustment is now needed. Lay-up, recycling and slow-steaming can all help to bring some equilibrium to the market. And then, another boom time will arrive again.
Over the history of seaborne trade, volumes transported have been quadrupled during the last four decades. Over the last forty years, the number of ships has doubled and the size of ships has doubled, with the total capacity being quadrupled, in order to sustain the growth of the world economy. Looking ahead, I am sure, in the long run, that seaborne trade will be significantly increased again over the coming forty years, to support the growth of trade particularly between countries in the south and others in the south. If you take a long-term perspective, the expansion of the Panama Canal makes sense. In the short term, the shipping industry will face difficult times, but I believe that we will overcome the current challenges and shipping will regain the profitable times in the not too distant future. Then, the expanded Panama Canal will bring a real opportunity to this maritime nation, Panama, to build up a maritime cluster, providing a major hub for the American continents and the Caribbean region.
The world of today has different expectations than that of the past. It was those changing expectations that led, for example, to the development of the amendments to MARPOL, to regulate greenhouse gas emissions, that entered into force at the beginning of this year. Under the new regulations, new ships must comply with the requirement for an EEDI (although a waiver is allowed until 2017), and existing ships must have an energy efficiency management plan. The challenge now is to ensure the widespread and uniform implementation – something that will require co-operation, consultation, an open-mind and a creative spirit.
Changing expectations were also a driving force behind the regulations by which the permissible amount of sulphur in ships’ fuel is being gradually reduced over time. Further effort is now needed to ensure the availability of low sulphur fuel, and that means that we must ensure there is sufficient investment in the oil and refinery industries if the 2020 targets are to be met. In this context, the role of Governments is significant: it is Governments that must set out clear policy; and it is Governments that must make suitable arrangements and give guidance to the industry to ensure the availability of low sulphur fuel.
Another major environmental challenge we are facing is how to deal with the invasive species carried in ships’ ballast water. We do not want to see invaders coming to disturb fragile the ecosystems of the Caribbean Sea and the waters of Panama. At the last meeting of the IMO’s Marine Environment Protection Committee, positive steps were taken to address the immediate problems associated with the entry into force of the Ballast Water Management Convention. The next MEPC, in May, and the IMO Assembly later this year will be crucial, but I believe we now have a clear pathway defined towards the entry into force of the Convention in the very near future.
Ladies and gentlemen, a few moments ago I mentioned changing expectations. I believe the world needs confidence in technology to ensure safety. Unprecedented disasters such as the tsunami and the subsequent meltdowns at the Fukushima nuclear power plant that hit my own country, Japan, in 2011, have brought into question what is safe and how we, as a society, can maintain the required level of safety. Events such as those have shaken and damaged our confidence in science and technology but we must rebuild our confidence in application of sound technology and science in order to explore our future in a sustainable manner.
In the maritime context, the Costa Concordia incident had a similar impact on the wider public. As the international body responsible for global maritime safety standards, IMO has a clear duty to ensure that any lessons to be learnt from this accident are clearly identified and quickly acted upon. The length of time we have waited for the official casualty investigation report has been longer than initially expected. However, we are now aware that the core casualty investigation has been finalized and, during my recent visit to Italy, I was assured by the Italian Coast Guard and the Ministry in charge that the report will be prepared and made available in March. Therefore, the next Maritime Safety Committee in June will be able to discuss all aspects of the casualty investigation report and take the necessary action, and I look forward to decisive action being taken in this regard, so that we can send a strong message to the world about how seriously IMO and the industry is dealing with safety of large passenger vessels and how effectively IMO could raise safety standards in the aftermath of a major casualty incident.
Seafarers, too, have their expectations and one of them, quite rightly, is that their everyday working lives should not be routinely threatened by pirates and armed criminal gangs. To this end, IMO continues to strengthen its efforts, in conjunction with its many partner organizations in the United Nations and elsewhere, to support the shipping industry and we have explored many avenues in order to reduce the number of successful attacks off the coast of Somalia. Recent figures suggest this work is at last beginning to pay off but we, of course, give this downward trend in successful attacks a cautious welcome and should not be complacent, but maintain protection of shipping lanes by navies until the risk of piracy is sufficiently eliminated in the Gulf of Aden and the Indian Ocean.
We have continued our work, with others, to address the root causes of piracy in Somalia and I have taken action to strengthen the team implementing the Djibouti Code of Conduct. That work, including the development of maritime situational awareness and the training of personnel, is particularly important. And, mindful of the concurrent increase in reported cases of piracy and armed robbery on the other side of Africa, IMO is also focusing on the development of maritime law enforcement capability in the countries of west and central Africa as our main effort for combating armed robbery against ships in the Gulf of Guinea.
Ladies and gentlemen, let me conclude by offering the thought that this year’s Panama Maritime event comes at a time when the maritime industries find themselves in a challenging period. However, I believe there is a major difference between this economic downturn and previous occasions in which the industry has been at the low point of the economic cycle – that is, the strong influence exerted by environmental concerns and environmental regulations and the concept of sustainability and sustainable development. Indeed, I think that they will eventually help the shipping industry bring about a fundamental reshaping of the world fleet, in favour of modern, safe, efficient and eco-friendly ships – ships of a new generation, which will give profits to shipping companies and which will support ever-increasing seaborne trade over the years to come.
Ladies and gentlemen, it remains only for me to commend the organizers of Panama Maritime XI for putting together what promises to be a fascinating and thought provoking conference. I thank you, once again, for the opportunity to participate and wish you every success.