May 15, 2009

Gravy Train

The fact that the maritime industry is indeed unique was brought home to me again by the Belgian Government’s recent announcement reported in Lloyds List. That country’s armed forces will now offer protection to Belgian ships at risk from Somali pirates, at the cost to owners of around a hundred and fifty thousand dollars a week. Private security agencies apparently charge approximately between 12000 and 18000 dollars a trip; obviously, the Belgian armed forces have higher overheads or a greater profit margin.

Coming up next: Somali pirates offering insurance at 100,000 dollars a pop; in return, they will guarantee that you sail through pirate waters untouched. Special annual rates offered for your entire fleet. Cheaper than the Belgian navy, and better. (Because they will offer guaranteed satisfaction, or your money and ship back!)

Post threat developments in our industry follow a typical pattern. Distinctive in this weave is the sight of innumerable players attaching themselves like parasites to the train, or ship, and continuing to milk it almost to eternity. The following is the usual sequence of events after the industry cannot ignore a problem any longer; this is what normally happens when the clamour after an accident or a systemic failure has become as shrill as it can get, and action must now be taken:

Stage 1: The IMO, Flag States, Port States and other consultative bodies attach themselves to the host. Budgets for ‘studies’ and jobs for experts and international (usually Western) consultants are now on offer. A new threat like Somali piracy opens up a new revenue stream. This will trickle down to others, and work well for a select few in an identical way that trickle down economics does: most of the end users get a trickle.

Stage 2: New IMO recommendations, Acts and Codes are enacted and ratified after the usual self centered wrangling and after many trees have been needlessly decimated for the reams of paper consumed. The new Acts attract others on board the lucrative gravy train: management companies that will bill owners for new equipment and training, the maritime education and training industry that will peddle substandard training, other alleged consultative experts and bodies, insurance, class, bureaucrats and equipment manufacturers (again mostly Western). The circle is almost complete by now.

Stage 3: The problem is not solved (perhaps it was never intended to be) or the results are too meager to declare success. Therefore, the gravy train can now be sanctimoniously perpetuated into eternity while we endeavour to solve it.

Of course, one should not discount, in countries like India, the relish with which the bloated and often corrupt bureaucracy looks forward to every new regulation and the power it gives them. To them, all this is often potatoes with gravy.

At least I would have fewer problems with this scenario if the outcome of this exercise resulted in a satisfactory resolution to whatever it was we intended to address. I agree that most other industries, especially international ones, have similar procedures and timelines. In most forward thinking industries, however, the results are far superior to ours. Other businesses seem to address issues more maturely and systematically than we do.

Consider the ISPS code. Ignoring Somali piracy, the fact is that years after its implementation, the situation today is that a few guys armed with nothing more than knives can board and threaten a ship, its cargo and its crew in many ISPS compliant ports in the world. A bunch of terrorists could create a major disaster, and probably will, at some stage. Yet the ISPS gravy train rolls on, unchanged and unexamined.

Consider the ISM Code. Although some may successfully argue that it has succeeded in safer ships and cleaner oceans, one must examine exactly how successful it has been considering the millions (billions?) that have been spent in the formulation of the Code and its implementation. Have we, after years of the ISM gravy train, got enough bang for the buck? I don’t think so. Copy and paste procedures and manuals, lackluster training and overworked crews aside (and even ignoring the blatant and universal violations of another convention, one that addresses fatigue at sea), results have not been good enough. The fact that ships of ‘advanced’ Western nations could dump nuclear and other waste off Somali waters in recent history is just one of the failures of the Code. Not enough bang for the buck, is my verdict, although, to put it a little crudely, many on the gravy train undoubtedly have enough buck for the bang.

And, finally, consider the Piracy issue. In addition to the pirates who seem to be riding the engine on board the gravy train, others who have benefited financially from piracy include insurance and reinsurance companies, international organisations and private security agencies, for a start. (It may not matter, but personnel working for one of these agencies, Blackwater, have been held guilty of murder in Iraq and have been chastised by the United Nations Assistance Mission there). Other direct beneficiaries include management companies that hold training programmes and seminars on piracy, secretive organisations that deliver ransom monies and others that launder it and seafarers who get extra allowances for sailing through dangerous waters. If the recent US lawsuit filed by the Cook against Maersk sets a precedent, the gravy train will become slurpier. Incidentally, there is another plan in the pipeline: more training for crews in anti piracy measures. Prepare to do this at your next revalidation, folks.

At the end of it all, we do not seem to be any closer to the resolution to the piracy issue, which is a problem to be solved on land anyway. It does not matter, though. The gravy train rolls on, with new compartments being added to it every now and then. One recently attached one is the ‘criminalisation of seafarers’ compartment. By now, it is attracting the usual travellers with others running on the tracks alongside trying to jump on. Codes have been formulated, industry bodies are already on board, the usual consultants and ship management companies are well entrenched and the Hebei Two are still in Korea. Meanwhile, the European Union is pushing fast to implement new regulations that will criminalise pollution further and widen the geographical area that sailors are scared to transit today. A new crop of inspections and oppressive regulation will get more on board the gravy train.

The more things change, the more they stay the same.