Thursday, 30 April 2020
The shipping industry experienced major disruptions in Q1 of 2020 due to both the Coronavirus and the crude oil price crash. As major parts of the global economy shut down, so have pockets of international trade – yet, not all vessel types have experienced the same disruption.
Not all vessel types need a bailout
Our analysis using Vesseltracker shows that cruise ship activity has collapsed in the wake of reduced tourism due to the coronavirus pandemic, with global port calls falling from 900 port calls per week in January to fewer than 100 port calls per week in April, with an overall drop of 35% in total year to date activity compared to 2019.
Other vessel types have fared better than the cruise ship activity but remain at lower levels of activity compared to 2019. We see declines for vehicles roll-on/roll-off (-15%), containers and crude oil (-3%) and bulk (-1%) vessel traffic.
China: how quickly can its vessel activity return to normal?
When will the sector see some relief? We partnered with our sister company, AIR, that pioneered catastrophe modelling since 1987, to shed insight. We project China is past its apex and over four weeks ahead of other countries, so we began to look at how its maritime traffic has recovered using Vesseltracker, the most accurate global shipping database.
The double impact of the coronavirus and the Lunar New Year was felt in Chinese shipping activity. While activity is expected to fall during the holiday, the reduction in container vessel activity was steeper and longer compared to 2019. The full recovery in container vessel activity from the holiday decrease in activity lasted 47 days, compared to 60 days this year.
As the coronavirus spreads globally, global container vessel activity is significantly down from January levels, and the Chinese recovery could provide further guidance on recovery on a global level.
Source: Wood Mackenzie
The Port of Felixstowe is Britain's busiest container port and one of the largest in Europe.
Over 40% of Britain's containerised trade passes through the port. Its optimal location, scale advantage and operational excellence, coupled with unrivalled connections to the domestic and global market, ensures the Port of Felixstowe delivers best on the real needs of our industry.
Maersk Kingston sails from Felixstowe On the sunny and breezy morning of Thursday, 30 April.
Maersk Kingston sails towards Rotterdam from the port of Felixstowe.
Driverless HGVs to replace much of the UK’s conventional lorry and container transport within a generation, they would transform the way the RORO market works in Great Britain.
Changes anticipated include significant growth in the market share of ‘driverless accompanied’ RORO traffic – particularly through North Sea and Western English Channel ports.
This is according to a new white paper published by the British Ports Association in collaboration with the specialist freight transport consultancy MDS Transmodal.
Technical developments and commercial and environmental pressures are expected to encourage freight operators to look at new and innovative ways to ship the relatively high-value trade that will be transported in trailers through the British ports of the future.
The study examines how freight traffic between the British Isles and the Continent could change in the longer term after Brexit.
It plots how a large proportion of the UK’s maritime traffic will fare in 2050 under an ‘autonomy and carbon reduction’ scenario in which autonomous and ultra-low emission HGVs have been widely deployed.
This will have impacts on UK ports and shipping but also UK roads and other national infrastructure such as rail links.
‘The Impact of Autonomous and Ultra-Low Emission HGVs on the British RORO Port Market’ White Paper is released as part of the BPA’s Port Futures Programme which examines emerging trends in the maritime industries and explores the opportunities and challenges to British ports that may present themselves over the next 50 years.
Commenting, Phoebe Warneford-Thomson, Policy and Economic Analyst, at the British Ports Association said:
There are undoubtedly significant challenges ahead for the RORO sector and the wider ports industry, such as the transformation to net-zero carbon emissions and moves towards automation.
However, with detailed analysis and forward-thinking as shown in this report, we can plan for the changes ahead and turn these into lucrative opportunities.
By forecasting the future trends in the RORO sector and ensuring ports can cater for the potential growth in the ‘driverless accompanied’ type of traffic, they can anticipate these changes and be ready to maximise economic advantage.
Commenting, Chris Rowland, Managing Director, at MDS Transmodal said:
Technical, regulatory and economic barriers remain with regards to the deployment of autonomous HGVs on the British highways network by 2050.
However, given the policy imperative of reducing emissions and the market-based need to increase the efficiency of road freight transport, particularly given rising HGV driver costs, we anticipate a significant industry-wide effort to overcome these barriers
The modelling of scenarios using MDS Transmodal’s GB Freight Model (GBFM) suggests that:
The roll-out of autonomous HGVs would lead to a boost for the accompanied RORO mode, which would secure an 80% market share in 2050.
As this boost in share is largely due to lower driver costs, a new type of RORO traffic – ‘driverless accompanied’ – would be created.
This increase in autonomous HGVs and subsequent rise in the RORO ‘driverless accompanied’ traffic would lead to growth in traffic through ports in almost all parts of Great Britain, but particularly through the Humber and on the Western English Channel.
The impacts on specific ports vary according to their existing mix of traffic between accompanied and unaccompanied RORO and their geographic location.
The report concludes that despite hurdles to be overcome before autonomous and ultra-low emission HGVs are operating on British highways, there is likely to be a significant future focus on overcoming these obstacles as operators seek to reduce costs and remain competitive.
Furthermore, it would lead to Britain’s short sea transport chains becoming both more efficient economically and more sustainable.
Luke Smout Felixstowe
Wednesday, 29 April 2020
The guided-missile destroyer USS Kidd (DDG 100) arrived in San Diego on Tuesday to treat sailors after a COVID-19 outbreak on board.
The USS Kidd was at sea participating in counter-narcotics operations in the U.S. South Command area of responsibility when several sailors began exhibiting influenza-like symptoms.
As of Tuesday, 64 sailors on guided-missile destroyer USS Kidd (DDG-100) have tested positive for the virus, with 63 percent of the crew tested, USNI New reported.
Prior to its arrival, two sailors were medically evacuated to the United States, while another fifteen were transferred to the USS Makin Island (LHD 8) for closer observation out of an abundance of caution.
While in San Diego, all sailors will be isolated off-ship with twice-daily medical screenings. Crewmembers who have tested negative will enter quarantine for a period of observation. A small number of COVID-19 negative sailors will remain on the ship for essential services and deep-cleaning.
“San Diego may not be USS Kidd’s home port, but we are definitely being made to feel at home,” said the ship’s commanding officer, Cmdr. Nathan Wemett. USS Kidd is based out of Naval Station Everett, Washington.
The ship will also undergo a full deep-cleaning which is expected to take two weeks.
“The USS Kidd Sailors continue to fight through this pandemic in order to get back to sea as soon as possible and execute their mission,” the Navy said.
By Stephen Cunningham and Robert Tuttle (Bloomberg) —
A fleet of supertankers carrying Saudi oil will add to the growing congestion at U.S. ports in coming weeks at the same time producers are shutting in output as they run out of space to store unwanted supplies.
A total of 43 million barrels of Saudi oil is set to arrive on the U.S. Gulf and West coasts by May 24, according to Rystad Energy. The flotilla — comprising 28 tankers, including 14 very large crude carriers, or VLCCs — will join a queue of 76 tankers waiting to unload in U.S. ports as the greatest oil glut in history plays out.
Dozens of tankers are lined up off the two coasts with demand for motor and jet fuel destroyed by the Covid-19 pandemic. There are 34 tankers already waiting in line to offload about 25 million barrels on the West Coast, and 31 tankers lined up off the U.S. Gulf Coast.
“The congestion at U.S. ports has reached new highs,” Paola Rodriguez-Masiu, Rystad Energy’s senior oil markets analyst, said in a statement. “We find it unlikely that all tankers will be able to unload upon arrival.”
The growing glut of oil have caused futures prices for oil to plunge 75% this year as available storage filled up in Cushing, Oklahoma, the delivery point for West Texas Intermediate futures. If the Saudi tankers can unload, their cargoes will offset almost all of the U.S. production cutbacks from March levels, according to Rystad. That will maintain the high rate of oil in storage, potentially keeping prices low.
U.S. President Donald Trump has come under pressure from Republican senators to stop the tankers hauling Saudi oil from unloading and adding to a domestic glut spurred by the Covid-19 pandemic. However, refiners countered that some U.S. plants are configured to run on the type of medium and heavy sour crude that’s typically imported from Saudi Arabia.
As of Monday, about 14 million barrels of oil sitting in tankers off the West Coast was classified as being in storage, twice as much as off the Gulf Coast, the world’s biggest refining center, according to Paris-based Kpler, which tracks tankers. Traditional oil tanks are less numerous on the West Coast than they are on Gulf Coast, leaving giant tankers as a key alternative, according to Emmanuel Belostrino, a crude oil market analyst.
“The increase in oil in floating storage is a lot more significant for the West Coast compared with the Gulf Coast since the former has significantly less onshore crude storage capacity,” Belostrino said by email. “West Coast states were quicker to respond in their social distancing and quarantine measures, causing demand for petroleum products to drop more quickly.
© 2019 Bloomberg L.P
Twenty port authorities from different parts of the world have signed a declaration calling for collaboration and sharing of best practices in ensuring port operations remain open to trade as part of the global efforts to fight the COVID-19 pandemic.
Ports across the globe have been declared essential services and have been working around the clock to maintain trade of goods, especially of food and medicines, uninterrupted.
However, there have been numerous challenges in ensuring the safety of port workers and seafarers while continuing to keep the operations going.
The declaration initiated by Singapore was signed by members of the Port Authorities Roundtable (PAR) including Abu Dhabi Ports, Antwerp, Hamburg and Rotterdam ports, Port Klang, Busan, Shanghai, Yokohama as well as Seattle, Long Beach and Los Angeles Ports.
It was the first virtual declaration for PAR members.
Through this joint declaration, the signatories committed to work together and ensure that merchant ships can continue to berth at port terminals to carry out cargo operations and keep the global supply chain going.
The ports also agreed to adopt best practices according to national circumstances, including precautionary measures for the shipping community, advisories and assistance for shore personnel and ship crew, and safe handling of cargoes during this period.
Furthermore, the port authorities vowed to continue to share experiences in combating COVID-19 while safeguarding unimpeded maritime trade.
“As the world battles with the COVID-19 pandemic, it has never been more critical to keep our ports open and goods moving. Shipping is chartering into many unknowns and new challenges. Port authorities have to take enhanced precautions for their ports and on ships, as well as manage the stress faced by our seafarers and maritime personnel. We have come together to make a declaration of our commitment, exchange experiences and share best practices,” Quah Ley Hoon, Chief Executive at the Maritime and Port Authority of Singapore (MPA), said.
“We came out of the session gaining more valuable knowledge to ensure that necessities and essential medical supplies continue to be transported seamlessly across the world and into our respective countries.”
PAR has shared the declaration with the International Maritime Organization and the International Association of Ports and Harbours to rally other port authorities to join this declaration.
At a time when seafarers are keeping the world moving, COVID-19 cannot be used as an excuse to lower the wage and working conditions of seafarers, the International Transport Workers’ Federation (ITF) said.
Seafarers are vital employees because they keep the global supply chains moving. Seafarers, including those on ferries, transport around 90 per cent of the world’s goods, including necessary medical supplies, equipment, products and passengers.
Amid the ongoing pandemic, seafarers continue to work to ensure vital goods and passengers are transported, selflessly and in spite of the risks of contracting COVID-19. Despite the vital role that seafarers play, some companies are seeking to use the pandemic to undermine national standards in the industry, including replacing existing crews with seafarers on international terms and conditions that are substantially lower than national conditions, according to ITF.
“The pandemic cannot be used as an excuse for shipowners, managers or crewing agencies to dismiss their obligation to protect local jobs, local conditions or health, safety and economic standards in an industry for any work – especially for key workers including seafarers,” ITF stressed.
“Regardless of the nationality of a seafarer, they deserve the national terms and conditions applicable in national trade.”
In the United Kingdom, multiple companies, including Condor Ferries, Stena Line and P&O Ferries, have laid off seafarers, and asked them to choose between taking unpaid leave or being furloughed, ITF said. This is putting a serious economic strain on the seafarers and their livelihoods. Further, companies are using the pandemic to undermine long-existing collective bargaining agreements, the union remarked.
“National governments must play a necessary role in ensuring market downturns due to Covid-19 do not turn into unfair redundancies for seafarers or undercut current wages. Now more than ever, critical trade routes that deliver essential supplies should be crewed with national seafarers,” James Given, president of Seafarers International Union of Canada and chair of the ITF Cabotage Taskforce, commented.
“To use this pandemic as an opportunity to further erode conditions on ferry routes is opportunism at its worst.”
Companies who receive government funds have an obligation to ensure jobs for national seafarers since those funds are taxpayers’ money. Further, national governments must place conditions on employers who receive public funds that they must protect the wages of furloughed seafarers, including the preservation of existing and pre-existing terms and conditions of employment, ITF added.
The United Kingdom is one of the countries that introduced a government support package to keep the flow of goods and services running smoothly in and out of the UK, and around the country, throughout the pandemic. The package for essential freight services includes up to £17 million ($21 million) for critical routes between Northern Ireland and Great Britain and up to £10.5 million for lifeline ferry and freight services to the Isle of Wight and the Scilly Isles.
What is more, ITF said that the battle against COVID-19 will not be won without transport workers, seeking urgent protection for ITF members globally.
On the occasion of International Workers Memorial Day 2020 on 28 April, the global trade union movement called upon governments and occupational health and safety bodies around the world to recognise SARS-CoV-2 as an occupational hazard, and COVID-19 as an occupational decease.
Due to the pandemic, many countries have closed their borders and restricted port entry. Consequently, seafarers found themselves being unable to embark and disembark from vessels.
The International Association of Dry Cargo Shipowners (INTERCARGO) once again drew attention to this issue.
As International Labour Day on 1 May approaches, it is more important than ever to remember the critical role played by seafarers in continuing to transport food, medicines and other essential goods during the COVID-19 pandemic, INTERCARGO said.
“Seafarers must not be forgotten in these extraordinary times. The issue of crew change must be at the top of the industry’s agenda,” Dimitris Fafalios, Chairman of INTERCARGO, said.
“Without efficient crew changes, the supply chain would break down leading to basic product shortages and greater hardships for people around the world,” he added.
“Maritime authorities of port states should join hands with their immigration departments to empathise with crews, our unsung heroes at sea, treat them as key workers as requested by the IMO Secretary General and permit crew change without undue restrictions in their ports to ensure safety at sea and of their territorial waters,” Jay K. Pillai, INTERCARGO’s Vice-Chairman, concluded.
Sea Rescue South Africa informed on pilot accident, which took place on Apr 28 in Durban Harbor:
At 07h45, Tuesday, 28th April, NSRI Durban duty crew were activated by Transnet National Ports Authority (TNPA) following reports of a 35 year old male TNPA ships Pilot fallen into the sea off a crude oil tanker in the vicinity of N Shed Wharf in the Port of Durban.
A securing rope on a rope ladder reportedly severed from undetermined causes while the man was disembarking from the crude oil tanker that was under sail departing the Port of Durban.
The Pilot vessel Lufafa went to his rescue and he was recovered and brought to T Jetty where they were met by Police S&R, Metro Police S&R and Life Healthcare paramedics.
He was treated for mild hypothermia and as a precaution, has been transported to hospital by ambulance in a stable condition for further medical evaluation and medical care and is expected to fully recover.
Container ship PACIFIC EXPRESS was identified by Vietnamese Maritime Authorities and Coast Guard, as the ship involved in hit-and-run accident, said Quy Nhon Maritime Port Authority in a statement, issued on Apr 25.
Container ship struck fishing boat off Quy Nhon Port, Binh Ding Province, central Vietnam, on Apr 10. Fishing boat sank, 3 fishermen on board were thrown into water. Container ship didn’t stop and continued sailing, fishermen were rescued by nearby fishing boats.
Owner of container ship is to compensate fishermen for lost boat and other losses.
Hutchison Ports Thailand, the nation’s leading port operator and an innovator in global ‘smart port’ port development, announced today that it is now the first port operator in Thailand and among the first in the world to acquire and test autonomous trucks at its Terminal D facility at Laem Chabang Port, Chon Buri.
The announcement marks a huge step forward for the development of the nation’s ‘smart’ infrastructure along the Eastern Economic Corridor (EEC), with the autonomous, ‘Qomolo’ trucks promising to improve efficiency and safety at its operations at Terminal D.
The investment will not only benefit Hutchison Ports Thailand’s customers and port users at Terminal D, but other stakeholders along the EEC; a key gateway to the greater Mekong region.
The six electric ‘Qomolo’ trucks (also known as the ‘Q-Truck’), arrived at Terminal D from Shanghai, China on 26 April, with the testing phase set to run for one year. During this period, the trucks will be integrated with the existing conventional fleet of trucks to transfer containers between the quay and the yard.
Equipped with advanced AI machine-learning technology and a wireless charging system, the Q Truck can operate non-stop for more than 24 hours.
The trucks utilise the advanced ‘LiDAR’ light detection and range technology, through which it can instantaneously (and accurately) detect and survey its surroundings in all directions, generating a precise, internal 3D map, enabling it to accurately analyse and avoid obstacles and collisions.
The operation of the trucks will be integrated into – and controlled by – Hutchison Ports’ Next Generation Terminal Management System (“nGen”), which works in conjunction with other innovations – such as remote controlled-cranes – to plan transportation routes, manage operation time schedules and arrival patterns.
Mr. Stephen Ashworth, Managing Director – Thailand & South East Asia of Hutchison Ports, said, “The autonomous ‘Q-Trucks’ utilize the latest technology and innovation, and are part of our ongoing plan to transform Terminal D into the most technologically advanced and efficient container terminal in the region.
The Q Truck continues to push the envelope for port innovation and along with our other already and soon-to-be implemented innovations, such as remote controlled crane-technology, online e-tracking services, gate automation and blockchain technology, we are rapidly approaching our goal of becoming the nation’s first fully-developed ‘smart port.”
Luke Smout Felixstowe
Monday, 27 April 2020
|Luke Smout- feeling a bit giddy!|
For the avoidance of doubt, I suffer with really bad sea sickness- I even felt a bit giddy on a canal barge on our last family holiday. So a job on a small passenger foot ferry in the Orwell Estuary may not have been my greatest idea to date.
A bit of history of the Harwich Harbour Ferry. In it's previous life, The Ferry was actually a life boat on the SS Canberra ocean liner.
She was built at the Harland and Wolff shipyard in Belfast, Northern Ireland at a cost of £17,000,000. The ship was named on 17 March 1958, after the federal capital of Australia, Canberra.
She was launched on 16 March 1960, sponsored by Dame Pattie Menzies, GBE, wife of the then Prime Minister of Australia, Robert Menzies.
She entered service in May 1961, and made her maiden voyage starting in June. She appeared in the 1971 James Bond film Diamonds Are Forever.
In the 1982 Falklands War she served as a troop ship. In 1997 the singer and songwriter Gerard Kenny released the single "Farewell Canberra" which was specially composed for the last voyage.
On 2 April 1982, Argentina invaded the Falkland Islands, which initiated the Falklands War. At the time, Canberra was cruising in the Mediterranean.
The next day, her captain Dennis Scott-Masson received a message asking his time of arrival at Gibraltar, which was not on his itinerary. When he called at Gibraltar, he learnt that the Ministry of Defence had requisitioned Canberra for use as a troopship.
Canberra sailed to Southampton, Hampshire where she was quickly refitted, sailing on 9 April for the South Atlantic.
|Rough seas. . . Credit: Luke Smout|
I really enjoyed my short stint on the ferry and surprisingly I was never actually sea sick- the skipper told me that it was because of the short distance of the crossing and that no one to date has ever been sick on the boat, even when it gets a bit choppy.
Although I thoroughly enjoyed my time and felt proud to have contributed in a small way in the Ferry's 104 year history, I live in Felixstowe, which meant I had to commute to Harwich quite frequently, which wasn't exactly ideal!
If you are ever given a chance to work on the Ferry, I would 100% recommend that you should give it a go, even if it is to combat your seasickness!
In part 2 of our coverage of her departure, ultra large container ship Ever Govern settles onto her heading and gets underway. Svitzer Shotley leaves the bow station and moves to the quarter, while Svitzer Deben stays on the stern and moves out to provide swing power on the Beach End Turn.
Sunday, 26 April 2020
Built by Hyundai Heavy Industries in South Korea in 2015 for the United Arab Shipping Company, MV Barzan is an ultra-large container ship. Having a DWT of 199,744 and a gross tonnage of 195,636, MV Barzan was the largest container ship when it was produced.
Another thing that made MV Barzan famous was that it has carbon emissions far lower than the Maersk EEE class container ships. MV Barzan is likely to continue to be very popular in the maritime industry since it has the lowest per-container level of carbon emissions which is almost 50% less than the IMO’s new limit set for 2025.
9. COSCO Shipping Taurus
COSCO Shipping Taurus was built in 2018 by Waigaoqiao Shipbuilging for the China Ocean Shipping Company Limited. This mono-hull ship’s only purpose is container carriage, with a capacity of 20,119 TEU. It has a length of 399.8 meters and a breadth of 58.7 meters. COSCO Shipping Taurus is registered and sailing under the flag of Hong Kong.
8. MOL Triumph
Equipped with highly advanced energy-saving technologies, MOL Triumph was built in 2017 by Samsung Heavy Industries in South Korea for the Mitsui O.S.K. Lines. When it was built, it immediately made the headlines as the world’s first 20,000 TEU-class container ship (20,170 TEU, to be exact).
With an overall length of 400 meters, a width of 58.8 meters (193 ft), and a maximum summer draft of 16.0 meters (52.5 ft), MOL Triumph has a deadweight of 192,672 DWT.
Its service speed is 22.0 knots, and the maximum recorded speed is 24.0 knots.
7. MOL Truth
MOL Truth was manufactured by Imabari Shipbuilding Company Limited for the Ocean Network Express group of Japan in 2017. Its length overall is 400 meters, the beam is 58.5 meters. With a container capacity is of 20,182 TEU, MOL Truth is sailing under the flag of Panama. Its optimized hull shape and other advanced technologies used to built it are able to reduce the CO2 emissions of MOL Truth by up to 30%.
6. Ever Golden
Another container ship built by Imabari Shipbuilding Company Limited and sailing under the flag of Panama is Ever Golden. Built in 2018, its length overall is 400 meters and the beam is 58.8 meters. The ship has a gross tonnage of 21,7612, a deadweight of 199,692, and a container capacity of 20,000 TEU. One thing Ever Golden lacks is the ability to serve with very high speed. Its maximum recorded speed is 11.4 knots.
5. Madrid Maersk
Madrid Maersk was built by Daewoo Shipbuilding & Marine Engineering Shipyard for Maersk Line. It is the first of 11 second-generation Maersk Triple E-class container ships. During its launch in 2017, it became the second 20,000 TEU-class container ship ever (with 20,568 TEU). With a deadweight Tonnage of 192,672MT, Madrid Maersk measures 399 meters in length and 58.8 meters in breadth.
4. CMA CGM Antoine De Saint Exupery
Named after the French author Antoine de Saint Exupery, who wrote the famous Little Prince, CMA CGM Antoine De Saint Exupery is the largest container ship to sail under the French flag. It’s also the largest Europe-based ship.
CMA CGM Antoine De Saint Exupery was built in 2017 by Hanjin Heavy Industries and Construction for the French shipping company CMA CGM. It is 400 meters long and 59 meters wide and has a dead-weight of 202684 MT. This environment-friendly vessel’s new generation engine reduces its oil consumption by up to 25% and its carbon-di-oxide emission by up to 4%.
3. COSCO Shipping Universe
COSCO Shipping Universe was built it 2018 by the China State Shipbuilding Corporation for China Ocean Shipping Company Limited. Registered and sailing under the flag of Hong Kong, it is the largest cargo ship in China with a carrying capacity of 21,237 TEU. It’s 400 meters long, 58.6 meters wide and has a maximum speed of 22 knots.
With a deadweight of 199,000 MT, COSCO Shipping Universe is a flagship vessel of the 21st Century Maritime Silk Road.
2. OOCL Hong Kong
When it was built in 2017 by the Samsung Heavy Industries, it became the third container ship to surpass the 20,000 TEU. It’s 399.87 meters long and has a breadth of 58.8 meters and a depth of 32.5 meters. As the leading ship of the G-Class, OOCL Hong Kong can also carry 14,904 cubic meters of fuel.
1. HMM Aleciras
Amid Covid-19 crisis, Panama flies the flag for global shipping industry and for humanitarian values
Her Excellency Natalia Royo, Panama’s Ambassador in the United Kingdom
Amid Covid-19 crisis, Panama flies the flag for global shipping industry and for humanitarian values
Panama is showing strong leadership to the world in humanitarian assistance to its vital maritime sector and to society more widely, Her Excellency Natalia Royo, newly-appointed Ambassador of the Republic of Panama to the United Kingdom of Great Britain and Northern Ireland, tells Allaboutshipping in an interview. Ambassador Royo said that thanks to its geographical position Panama can distribute aid to the region quickly and efficiently amid the disruption the covid19 crisis has caused. The nation is taking robust measures to assist its economy, said the Ambassador, and is ready to extend deadlines where necessary for procedures involving shipowners and seafarers.
For many years, the Panama flag has maintained by far the top position in number of ships covered and in company registration, and the Panama Canal with its new locks that doubled capacity meets the demands size-wise for most of the shipping industry’s tonnage.
With the Coronavirus “tsunami” shaking Planet Ocean to its foundations, Panama is there to assist business in its entirety, the Ambassador assures its clients and partners, and keep the world on the move. At this critical time for Panama’s continuing development John Faraclas put some challenging questions to Ambassador Royo. Here are her comprehensive and incisive answers.
1)The Panama Canal Authority is requiring all ships transiting the waterway or planning port calls in Panama that have called at countries with confirmed cases of the Coronavirus to report contact. What effect is this having on ships planning the transit – is it slowing their progress, or even deterring some from this route? Are many ships being boarded? Do Panama officials have enough personal protective equipment including masks to carry out this task? Have any ships been detained for such reasons?
The Panama Canal plays a critical role in facilitating the safe passage of international goods and people and will continue to adapt its COVID-19 response protocols, in coordination with the Ministry of Health of Panama (MINSA) and the Panama Maritime Authority, to guarantee its safe and sustained operations as the situation evolves.
Currently, the Canal continues operating with its high standards and with the personnel needed for our transit operations.
It is important to emphasize the fact that the Panama Canal’s inspection and control personnel work tirelessly to ensure compliance with regulations on health and prevention of contagious diseases within its waters. These inspections for contagious risk issues have been carried out for years and are required for all vessels that arrive in the Panama Canal waters. To mention some, they include:
The vessel is required to report its conditions on board and does so through the Panama Maritime Single Window System (VUMPA, for its acronym in Spanish). In the case of non-compliance and/or providing false information, the vessel is subject to penalties and/or restrictions.
A Panama Canal inspector embarks and confirms the inquiries included in the Maritime Health Declaration through a form previously completed in the VUMPA.
The inspector also interviews the vessel’s captain or officer in charge to reconfirm that there are no sick people or crewmembers showing symptoms on board.
If there are any confirmed or suspected cases on board and depending on the symptoms it is concluded that there is a relevant disease aboard. When concluded that there is a relevant disease on a vessel then the Maritime Health Unit of MINSA, is called onboard. During this time, boarding and disembarking are prohibited for people and a yellow flag is hoisted, announcing the ship is under quarantine.
Next steps are determined, following MINSA’s inspection.
Nevertheless, in response to COVID-19, the following additional measures have been implemented at the Panama Canal:
Vessels are required to report if and when crew changes occurred within 14 days of arrival at ports with COVID-19 cases to MINSA.
Panama Canal’s inspectors must contact vessels via radio before boarding to confirm all crewmembers onboard are healthy and to verify any recent crew changes.
Panama Canal personnel are equipped with alcohol-based hand sanitizer gel and masks.
Also, the Panama Maritime Authority send Maritime Safety Information to all vessels arriving at Panama Ports Facilities, notifying strictly that only the crew involved in cargo operations can be on deck, while the rest of the crew have to be in their cabins or accommodations; with this measure, the contact between ports personnel and crew members will be reduced.
Constant communication is maintained between the Panama Canal and MINSA’s maritime health unit.
We have had cases of vessels that reported people with symptoms on board, but upon reviewing the cases, transit was allowed when it was confirmed that it was not COVID-19 or other contagious diseases.
Just recently we had two cruise ships, Zardamm and the MS Rotterdam, with 4 people who died on board allegedly due to COVID-19. The Ministry of Health, in coordination with the Panama Canal Authority and Panama Maritime Authority, authorized the transit of these ships through the Panama Canal understanding the situation of the passengers and the humanitarian aid required for the vessels to disembark on a safe port. The Canal took extreme sanitary measures to assist on the safe transit of these two vessels, including the use of the Neopanamax Locks to reduce to a minimum the number of the Canal’s operators involved in the operation.
Panama was the only country in the area to aid these vessels and it was done for humanitarian reasons. Our president Laurentino Cortizo has been prompt to promote solidarity among Panamanians and has shown a strong leadership to the world regarding humanitarian assistance.
Due to our assistance on the transit of both cruise ships, our government received messages of appreciation from many countries of the world, such as the United Kingdom, Canada, France and the Netherlands. Around 1,800 people on board from the countries mentioned were aboard these vessels. The Panamanian government is also aiding and cooperating with other countries on this difficult situation and we already have established a hub for humanitarian assistance to cover from Panama 24 Latin American countries. Thanks to our geographical position we can distribute aid to the region, quickly and efficiently and on the crisis covid19 has caused, this hub, which is the first one on the region and used by the Red Cross and United Nations, has become an important tool to help other countries.
2) The Canal is a vital support to the economy of Panama. How will the current difficulties impact its ability to help balance the national budget?
It is too early to measure the economic impact on the traffic throughout the waterway, but it is true that the Canal is vital for our economy. Even if the Canal represents around 5% of our economy, all the maritime and logistics activities that surround it represent approximately 30% of our GDP. The Canal contributes with around 20% of the government’s income that goes directly to social investments. Just for contextualizing the importance of the Canal to Panamá´s economy, in 2019 the state received 1,786 million USD. Having said that, we have a very diversified economy and a very resilient population. All will depend on the duration of the crisis but I am confident that, after the crisis, we will find new ways to prevail and cope with the world’s new social dynamics. Also, we have to take into account that the Canal works with a very well-prepared group of professionals and independently from the government so hopefully the situation will be transitory, and economies will be restored. Regardless of everything that’s happening, the Panama Canal acts, will react and has acted accordingly to the dynamics of the world economies.
3) Fitch Ratings has downgraded Panama’s rating from stable to negative, and the country is still listed in the Financial Action Task Force’s money laundering watchlist. What is being done to improve the situation, and how will the coronavirus emergency add to these pressures on the Panamanian economy?
President Laurentino Cortizo’s administration is fully committed to ensuring that the FATF Action Plan is carried out on time to ensure Panama’s prompt removal from the list. Besides, it is important to mention that the country’s banking centre is in compliance with FATF recommendations and that the sector financials are solid and stable, with robust liquidity and solvency. Only 8 months into the new administration, President Cortizo’s government has been working on strengthening the effectiveness and transparency of Panamanian institutions to also guarantee the rule of law and fair competitive conditions for local and international investments. In summary, these are some of the actions taken for the development of a more adequate framework:
1. The creation of the International Services Competitiveness Unit within the Ministry of the Presidency to align government agencies with a new mission, strategy and roadmap to enhance the financial services centre.
The government holds weekly high-level meetings with President Cortizo, the National Commission against Money Laundering, representatives from the Financial Intelligence Unit and the Prosecutor’s Office to ensure coordination of the FATF action plan and strategy and to achieve an effective AML/CTF/PWMD national system.
Enhanced coordination and communication protocols between inter-government offices, throughout standard operations procedures to identify, investigate, and prosecute cases related to AML/CTF/PWMD.
Four bills approved in Cabinet and Congress that:
(i) Suspends the access of companies that haven’t paid their annual tax for more than three consecutive years and/or have not reported their resident agent with the Public Registry;
(ii) Modifies the Penal Code to ensure that the appropriate law is implemented as a deterrent for tax evasion;
(iii) Imposes sanctions (5-8 years in prison) to those who carry out the money transfer service commercially without a license;
(iv) Guarantees full autonomy to the supervision entity.
The government is working towards the implementation of a Registry for Resident Agents and a Registry for Ultimate Beneficiary Owners.
Panama’s AML/CTF regulation will be modified to homologate the responsibilities of all obliged subjects and to establish more proportional and dissuasive sanctions.
Amendment of the law that requires accounting records to be kept by all Panamanian corporate vehicles operating abroad.
Updates of Chapter V (financial terrorism) of the country’s National Risk Assessment and updates to understand the major risks and apply the corresponding mitigation measures and controls.
Panama is committed to becoming the best Latin American business, services, and financial hub by mitigating the risk posed by criminal activities and complying with the required international standards.
Finally, the Latin American Anti-Money Laundering Group, GAFILAT, recognised the country’s progress and welcomed the significant improvements in the recommendations: Panama went from complying with 35 requirements to complying with 38 requirements out of a total of 40, securing a current technical compliance score of 95%.
In terms of COVID-19, naturally, the pandemic is affecting the global economy and it is in the hands of our world leaders and the leaders of every sector of our economy to take action. In Panama, the economic measures and relief efforts include initiatives from both the private and public sector, such as freezing some bank payments and obligations, the suspension or delay of several public bills and tax payment extensions.
Panama has already taken a total of 27 economic measures; there are 50 under evaluation to be implemented in the next 45 days, and 29 projects and additional measures are being reviewed for the aftermath of the pandemic. Panama´s measures are being replicated by other countries of the region.
Moreover, the Panamanian government has implemented a program of economic solidarity, “Plan Panama Solidario”, which is an emergency plan of social assistance and humanitarian relief for vulnerable communities in Panama that will help approximately 1.35 million people in the country. This program includes benefits such as physical and electronic (accessed via their national ID) coupons for food and medicine, food supplies, and donations.
I have to admit that I feel proud of how this government is dealing with the crisis, humanitarian and cooperative approach above all, as well as the rapid, coordinated and unified response of all governmental entities.
4)A big slowdown is forecast in global trade growth. How is Panama and the Canal going to be impacted and how will they cope with that?
This is an unprecedented situation, therefore anticipating the economic impact at the moment would be very premature. The impact will depend on how quickly the economies of the countries that use the Canal recover. This situation is still so recent, and we have not received the impact of the market yet. For instance, if ports on the east coast of the United States reduce or suspend operations or when production and manufacturing restart for inventory replenishment in Asia. We continue to monitor the situation closely as shipping companies inform us of their transit schedule.
Nevertheless, it is more than probable that there will be an impact. The Panama Canal Administrator just recently informed that 52 transits have been cancelled, 35 cruise ships and 17 cargo vessels. Since we are the channel that connects 1,700 ports in 160 countries, there will probably be a slowdown. The reduction on oil prices can also have an impact so maybe ships would not mind taking the longer route through Cape Horn. But, at the same time, vessels have to consider that taking a longer route can be more damaging to the climate and Panama offers several incentives to use oil without sulfur, as it was approved by the International Maritime Organization, so even that alternative it is not completely certain. We must wait to know the consequences and our country is ready to respond to the needs of this trade.
5) On March 11, the presidents of Belize, Costa Rica, Guatemala, Honduras, Nicaragua, Panama, and the Dominican Republic signed a joint declaration in which they committed to preparing a regional contingency plan to combat the pandemic, aimed at complementing national efforts. How well equipped is Panama’s health system generally in medical terms to cope with rising numbers of victims and suspects? What else is being done to alleviate the humanitarian crisis?
The Central American Economic Integration System, with the help of the Central American Bank for Economic Integration, approved a fund of one thousand nine hundred (1,900) million US dollars that will be used on a Regional Contingency Plan. Amid this difficult situation, it is very gratifying to see how all central American countries are trying to help each other in a united way. I have to say that all Latin American countries have been, as never before, working together to cope with the crisis in a coordinated and cooperative manner and making lots of efforts to find solutions, sharing best practices and common strategies.
Specifically about Panama´s health system, it is well known that this crisis has affected the health systems of all the countries where COVID-19 has been spread, therefore Panama has also been affected by this. Nevertheless, with the quick response our Government, led by President Laurentino Cortizo strict measures from the beginning have been implemented to alleviate our health system.
Panama has been considered a model for rapid response to Covid19 virus by United Nations health officials and as they said Panama´s response measures can be exported to other countries of Latin America and the world. The government have been behind these efforts from the start, and all Ministries have been working in a coordinated way. In my case, I felt truly supported by the Ministry of Foreign Affairs; since the very beginning, all Embassies received clear guidelines, accompaniment and support from the Ministry. As it is said, you will know how things and people work in a time of crisis, I have to say that the Panamanian government response was admirable, one step ahead compared to other countries and will continue aiding our fellow countries who require humanitarian assistance.
At the celebration of Panama IMO ‘s candidature with the Minister and Administrator of Maritime Affairs of Panama, Noriel Arauz, IMO’s Secreary-General Kitack Lim and other Panamanian officials
6) How will Panamanian companies and organisations – the international registry, shipowners and agents, ship suppliers and so on – be supported if their finances are badly hit?
The Panama Maritime Authority led by the Minister of Maritime Affairs and Administrator, Noriel Arauz, is taking the necessary measures to avoid the potential risks this pandemic may produce, taking into account that the maritime business must continue operating and that we must cooperate efficiently for its recovery.
We are committed to providing the best services; our personnel is ready to assist all our international clients 24 hours a day/7days a week to continue ensuring the expeditious service our clients are accustomed to, even during this unprecedented times.
It is crucial to remember that our registry is currently supported by 53 Consular Offices around the world and 13 International Technical Offices (SEGUMAR) that operate globally. It must be noted that our Registry is backed by the State and not by a consortium or private entity, therefore, we do not have the risk of going bankrupt on this sanitary crisis.
As Minister Arauz said, we are providing continuity ensuring that the operations will not be interrupted by any external factor since we have the appropriate equipment and technological platforms to solve all operations rapidly and remotely. The Panama Ship Registry has the mechanisms to facilitate our users in the registration of their property titles and ship mortgages electronically and remotely, avoiding the physical presence of the persons for the registration of such documents. All Panamanian Consular offices and Embassies worldwide are at the client’s disposal to provide them with all the notary services needed for the registration of property and licenses for the vessel’s operations, in an agile, efficient, remote and safe way, respecting and guaranteeing with each of our actions all the principles of legal security that have characterized us throughout the years.
The Panama Maritime Authority reaffirms the commitment to banking institutions worldwide that trust our ship registry to ensure their credit guarantees through the ship mortgage.
Additionally, Minister Arauz has issued instructions to all approved organizations that any audit, inspection or survey expiration date could be extended for 90 days, as well as dry docking is also extended for the same period. Also, an extension to Statutory Certification & Services and Certificate of Registry/Patents (in all its forms), Radio Station License (in all its forms), Exemption Certificates, Minimum Safe Manning Certificates issued to Mobile Offshore Units (MODU/MOU) has been issued. These benefits are focused on our direct clients of merchant marine. (Ref. Merchant Marine Notice. MMN-07/2020 and merchant marine circular MMC-313)
Furthermore, on Resolution JD No. 032-2020 our Administration suspends, for ninety (90) calendar days, the payment for the anchorage of passenger ships, port charges, berths, anchorage areas and marinas of the national territory, to all ships registered under the Panamanian flag; as well as an additional 50% off in the certification services of foreign seafarers onboard an economic group that keeps more than ten (10) passenger ships registered with the Panamanian flag.
Regarding the welfare of our seafarers around the world, the General Directorate of Seafarers offers to extend payments and licensing procedures to sailors and crew members on board the Panamanian flagship, Seafarers employment agreement SEA and certificates endorsements for 90 days.
At no cost, the ship owners and operator companies can request these special extensions for their crew members through any SEGUMAR office around the world. After reviewing each case and the compliance of the requirements established the Merchant Marine Notice MMN-03/2020, the SEGUMAR office will grant the necessary extensions/crew dispensation letter/authorizations following the good maritime practices and always ensuring the safe and uninterrupted navigation of ships on the Panamanian registry.
We encourage all the ship owners and operator companies to always follow the most updated PMA guidelines, circulars and marine notices through our consular offices, SEGUMAR offices and our governmental official maritime website:
Concluding this interview I must state that our team is here to help on this difficult and unprecedented times, so please if you or anyone on the maritime sector needs advice, do not hesitate to contact us at:
The Panama Consulate in London:
SEGUMAR office in London
Telephone: +442076293616 , +442076293649, +442076293650
|UK Border Force vessel docked at SMS Lowestoft|
THE SMS Group, trading from seven key ports in the UK, is playing an integral role in helping to keep Britain trading – supporting maritime infrastructure, crucial freight operators and the nation’s Defence sector.
SMS has an enviable reputation as specialists in ship repair, marine engineering and major fabrication projects in the Commercial marine, Defence and Superyacht sectors. The company also operates a diving and sub-surface marine engineering business.
Nicholas Warren, Commercial Director of The SMS Group, said: “From our seven sites we support the likes of the Royal Navy, via Babcock and BAE Systems, UK Border Force, Trinity House and various inter-island freight operators as well as numerous ports, harbours and tug/towage operations.
“We’re a small, but important part of the country’s maritime infrastructure and, as Island nation, we must keep trading.”
He added: “We’ve just this week docked a UK Border Force vessel in Lowestoft, provisioned support to aircraft carriers and nuclear submarines, and completed two emergency call-outs for two differing tug operators.
“We’ve also supported the vital inter-island ferry operators that help serve both the communities of the Channel Islands and the Isle of Wight.
“It’s key that we follow Government advice, take all precautions, keep colleagues and customers safe, and develop our own business processes, and then of course carry on.”
In these challenging times The SMS Group is looking to innovate too. The company has established a small, focused team, to provision mobile sanitation services to key customers with ship-side and shore-side assets that are in need of either one-off sanitation pre-recommencement of service, or routine sanitation whilst in service or in refit.
On the subject of innovation, Nicholas said: “As a business we try to put the customer at the centre of what we do; their problems are often our problems.
“Sanitation is now a challenge. We’ve seen interest from both Commercial and Defence customers alike.
“Our ‘fogging’ solution allows the operatives, working in two-man teams, to safely and quickly sanitise all the spaces on vessels that have historically proven difficult to do so by conventional methods.
“We can ‘fog’ machinery spaces, voids and bilges, small cabins, stair wells and both crew and passenger spaces with ease.
“This service is offered on a one-off, or scheduled basis. Our intent is to sanitise any given area against Covid-19, and at the same time ensure that passengers, crew and/or shipyard workers are aware of these higher standards of routine sanitisation.
“We want to reassure all stakeholders and end users.”
He added: “As the ‘lockdown’ eases we will see various marine platforms, across all our markets, with many of our key customers, being ‘reactivated’.
“You’ll also see shipyards return to work. If we can ‘fog’ vessel/shipyard spaces as part of the ‘reactivation’, and then thereafter between crew/shift changes, overnight, or on passenger turnarounds, then we hope to help our customers maintain the highest standards of onboard and shore-side sanitation.
“We want to stay safe and help keep Britain trading.”
The SMS Group has positioned ‘foggers’ and trained operatives throughout the businesses seven locations to try to ensure the geographical reach that we anticipate may be required.