Shipping
MOL to order 10 more large car carriers
MAJOR Japanese shipping group Mitsui OSK
Lines (MOL) is to build 10 large car carriers, to be delivered between
2007 and 2009 and built by either Minaminippon Shipbuilding or Shin
Kurushima Dockyard.
This latest newbuilding decisions follows
on a series of six car carriers delivered in 2003 and a further 12
ships that are being delivered by 2006. By 2009, MOL will have in
service 28 sistership car carriers, capable of carrying 6,400 cars at
20 knots. An MOL statement says that the company aims to expand its
car carrier fleet to meet increasing demand. The company forecasts
steady growth in worldwide trade volume. It expects its current fleet
of operated or owned car carriers will increase from 74 now to over 90
in 2009.
At the same time, MOL says, the company
will dispose of older vessels or re-deliver them to their owners,
while building a succession of new ships. MOL says that it is
creating a fleet structure that can precisely meet the market needs,
ensuring that appropriate size carriers are available for every trade.
The new vessels incorporate various
environmentally friendly features, including a wind
resistance-reducing design patented by MOL and Universal Shipbuilding
Corporation that is claimed to save energy and reduce emissions of
carbon dioxide and nitrous oxides by about 6 percent.
Emissions are further reduced, by about 30
percent, through use of a new cylinder injection system for main
engine lubricating oil.
In addition, to speed up loading and
discharging, all the new ships feature movable access ramps for
vehicles and improved deck layout.
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Shipping News
November 16, 2004
High steel prices, weak US$ hurting Korean shipyards
Daewoo, Samsung among
shipbuilders posting fall in Q3 earnings
SEOUL)
The impact of the decline of the US dollar and the global shortage of
steel have begun to show in the earnings of the world's biggest
shipbuilders.
Daewoo
Shipbuilding & Marine Engineering and two other South Korean
shipbuilders posted declines in third-quarter profits as the rising
price of steel boosted their production costs.
These
shipbuilders' earnings were also hurt by losses on foreign exchange
rates after the won strengthened against the US dollar, analysts said.
South Korea's currency has risen 7.9 percent against the US dollar
this year, reducing the value of US dollar-denominated orders when
they are repatriated.
Net
income for Daewoo Shipbuilding, the world's second-largest
shipbuilder, fell by two-thirds to 41 billion won (US$62 million), the
Seoul-based company said in a statement to the Korea Stock Exchange
yesterday.
Samsung
Heavy Industries, the world's third-largest, said profit fell 84 percent and Hanjin Heavy Industries & Construction's dropped by half.
Daewoo
Heavy, Hyundai Heavy Industries and other shipbuilders are completing
orders they received in 2001 and 2002 at record costs for decade-low
prices. Steel plate prices have risen by a third since January,
boosting production costs.
Shipbuilders are paid as they complete their orders. Hyundai Heavy,
the world's largest shipbuilder, said on Friday it had a 33 billion
won loss in the third quarter, compared with a profit of 3.8 billion
won a year earlier.
The price
of a tanker that can carry two million barrels of crude oil - an
industry benchmark - fell to a 10-year low of US$62.5 million in 2001.
Prices for new vessels have since risen as demand for cargo space
surges on expanding trade with China.
South
Korean shipbuilders get more than three-quarters of their steel plate
from two of the country's steel mills.
Dongkuk
Steel Mill Co has raised the prices of its steel plates used in ships
five times this year, by a total of 70 percent to 715,000 won a
metric ton. Posco, South Korea's largest steel maker, raised prices of
its ship steel plates sold in the country four times this year, or by
a total of 50 percent, to 600,000 won a metric tonne.
Earnings
were also affected by losses on foreign exchange rates. The won
reached 1,103.50 on Nov 9, its highest since Nov 24, 1997, when the
threat of bankruptcy forced the country to seek a bailout from the
International Monetary Fund. That has raised concerns that profits will be
undermined further.
Samsung
Heavy's net income dropped to 8.5 billion won from 53.3 billion won a
year earlier. Sales rose 13 percent to 1.14 trillion won. The
Seoul-based company booked a 37.7 billion won loss because of currency
fluctuations and a 33.7 billion won cost after paying more than the
market price to redeem convertible bonds.
Hanjin
Heavy, South Korea's fifth-largest shipbuilder said its net income for
the period fell to 3.6 billion won, compared with seven billion won a
year ago. Sales rose by half to 477 billion won.
STX
Shipbuilding Co, South Korea's seventh-largest shipbuilder, said on
Friday it had a 1.8 billion won loss in the period, compared with a
profit of 18.9 billion won a year earlier. Its sales rose 27 percent
to 198.5 billion won. – Bloomberg
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Nov 15, 2004
Zim in $732 million
expansion
The Jerusalem Post
reports that Zim Integrated Shipping Services Ltd. and its parent
company Israel Corporation have outlined plans for acquisition of 12
cargo vessels in a $732 million deal.
Israel Corp.
(controlled by the Ofer brothers) is the purchaser of the ships, and
their transfer to Zim's control is subject to approval by its board..
Twelve box ships are
involved. Eight 4,250 TEU vessels have been purchased, and are
currently under construction in China for delivery between March 2006
and January 2008. Two of the ships will be wholly owned by Zim, while
four will be equally owned by Zim and the Ofer group. The additional
two vessels have been leased from London-based Zodiac Maritime (an
Ofer group subsidiary) for 10 years. Cost of leasing totals $23,000
per day.
The Jerusalem Post
says Zim has also acquired four 6.350 TEU postpanamax ships for its
Europe Asia routes. They are being built in Japan, and will be
delivered between the first half of 2008 and first half of 2009. Two
are wholly owned by Zim, and two will be leased from Zodiac.
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Global congestion to
slow trade: APL chief
Widdows tells importers that container
jam threatens worldwide trade
Thu Nov 18, 2004
By Peter T. Leach
The JOURNAL of COMMERCE ONLINE
NEW YORK -- The chief
executive of APL warned Tuesday that the growth of world trade
is threatened by port and rail congestion, not just in the United
States, but worldwide.
The problems of
congestion will become particularly acute in 2005 and 2006 when most
of the world's liner companies deploy new 8,000- and 9,000-TEU
container ships that are on order, Ron Widdows told the Textile and
Apparel Trade and Transportation Conference.
"What is not
understood is the impact of congestion on carriers' ability to deploy
new capacity in 2005," Widdows said. "The problems of inadequate
terminal capabilities are global and will be with us for years.
Intermodal capability is stretched at nearly all major load centers
worldwide."
Widdows, who heads up
the liner division of Singapore's Neptune Orient Lines, has spent much
of the year warning of growing congestion in an effort to rally
support for infrastructure solutions in the U.S. His speech Tuesday
marked the first time he had broadened his warning to include most of
the world's ports.
In an interview
afterward, Widdows said his speech was aimed at shocking the audience
of some 400 textile and apparel importers who gathered to hear experts
assess the impact of the Jan. 1 elimination of U.S. quotas on textile
imports.
"All of the work of
the last 15 years on building global supply chains is beginning to
become unwound," Widdows said. "The [ocean] trip from Hong Kong to Los
Angeles should take 19 days, but the average is now 24 because of port
congestion."
Widdows said that
"we're getting very low productivity [at LA-Long Beach] on the part of
the ILWU [International Longshore and Warehouse Union]," he said. "The
labor management relationship between the Pacific Maritime Association
has only made the situation worse. It needs to change."
Widdows said that
infrastructure problems are contributing to a deterioration of service
reliability and loss of velocity through the transportation chain
worldwide. This is impacting purchasing and distribution patterns.
"In the United
Kingdom and France the infrastructure is even worse than on the [U.S.]
West Coast in some ways," he said. "Asia, India, Singapore and Vietnam
are coping better, but are having problems.
"Governments in many
regions have yet to either develop an understanding of the
implications of inadequate infrastructure or move to implement
solutions. The U.S. government understands the problems, but can't
translate it into action politically," he said.
Widdows' alarm
resonated with conference-goers. In an electronic poll taken
immediately after, 74 percent of the audience said that congestion in
Los Angeles-Long Beach was the most important issue facing them.
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American Shipper
Shippers' NewsWire
11/19/04
Analyst expects
"major downturn" in container shipping in 2006
Credit Suisse First
Boston warned in a report on Asian container shipping that a "major
downturn" in the liner shipping market is probable in 2006, with ship
capacity increasing much faster than cargo volumes.
"It's a cyclical
business," the investment firm said. "Unless economic growth and
global trade is unexpectedly strong going into 2006, and port
congestion effectively reduces the growth in global capacity, we
believe that 2006 will see a major downturn in container shipping."
Credit Suisse First
Boston's analysis is based partly on forecasts of overall capacity and
traffic made by Drewry Shipping Consultants. It predicts the global
container fleet will soar about 14 percent in 2006, while traffic will
rise only 9 to 10 percent.
"We forecast that
freight rates will fall substantially in 2006, which will mean a sharp
earnings decline for the container shipping companies," Hong Kong and
Singapore-based analysts wrote in the firm's investment report.
The analysts
therefore urged investors to use conservative valuations of Asian
shipping stocks such as China Shipping Container Lines, Evergreen
Marine Corp., Yang Ming Marine, Wan Hai, Neptune Orient Lines, Orient
Overseas (International) Ltd., Hyundai Merchant Marine and Hanjin
Shipping.
On Monday, Ray Miles,
chairman of CP Ships, told investment analysts the current bull run of
the liner shipping industry could end in 2006 if demand weakens.
He said industry forecasts
show "a big gap" between expected supply and demand in 2006, with ship
capacity predicted to go up about 14 percent in 2006 and traffic
growth forecast to rise about 8 percent. Miles cautioned that the
prospect of a downturn in 2006 was still uncertain.
Credit Suisse First Boston
also confirmed that 2004 has been strong in terms of profitability for
container shipping lines, with freight rates up substantially.
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Bi-Weeky News ~ USA
18
November 2004
TSA
Announcement: 2005 Rate Increases
Container
shipping lines in the Transpacific Stabilization Agreement (TSA) have
completed a detailed assessment of market, operational and
infrastructure conditions in the Asia-US container freight market, and
finalised pricing plans for 2005 tariffs and service contracts.
The
carriers reported that aggregate operating costs in the Pacific
continue to rise, and will increase next year by at least 11-12 percent, depending on route and transport mode. Port and inland
congestion in the US and Asia, and delays moving through the Panama
Canal, have made the situation worse, the group said in a statement.
In
response, TSA lines have recommended the following increases in
current freight rates, effective in carrier tariffs and upon renewal
of service contracts, by no later than May 1, 2005.
A US$285
per FEU increase will be imposed on US west coast and "Group 4"
western US shipments. A $350 per FEU for inland point intermodal (IPI)
and minilandbridge (MLB) cargo charge will also kick in next year.
In
addition, a $430 per FEU rise for all-water shipments to the US east
coast and Gulf ports via the Panama and Suez Canals is to be added.
Carriers
further recommended retaining a peak season surcharge (PSS) of $400
per FEU, applicable to shipments from June 15, 2005 through November
30, 2005.
The PSS
covers higher contingency planning and operating costs during periods
of full vessel utilization, such as have been experienced in 2004. It
also addresses the structural costs to carriers of maintaining
year-round vessel and equipment fleets and schedules. Sustained peak
period conditions during 2004 have prompted TSA lines, in a separate
action, to recommend extending the current PSS for US-east coast
all-water shipments through January 31, 2005.
TSA members
include: APL, "K" Line, CMA-CGM, MOL, Cosco, NYK, Evergreen Marine,
OOCL, Hanjin Shipping Co., P&O Nedlloyd , Hapag Lloyd, Yangming Marine
Transport Corp. and Hyundai Merchant Marine.
Rail
American Shipper Shippers'
NewsWire
11/10/04
Supreme Court rules “Himalaya” clause
protects railroad
In a decision
rendered more quickly than anticipated, the U.S. Supreme Court ruled
unanimously Tuesday in the case of “Norfolk Southern vs. James. N.
Kirby Pt Ltd.” that a railroad, as a participant in multimodal
carriage, is entitled via a “Himalaya” clause to an ocean carrier’s
bill of lading liability limitation under the Carriage of Goods by Sea
Act (COGSA).
The decision
means Norfolk Southern, which had faced a possible maximum $1.5
million tab after a train derailment in which 10 containers of
machinery were damaged during the land portion of an international
shipment, is likely to be liable only for $5,000, or 10 times COGSA’s
$500-per-package limitation of liability, each container being
considered one package.
“A single
Himalaya Clause,” which extends an ocean carrier’s liability
protections to its agents, “can cover both sea and land carriers
downstream … confusion and inefficiency will inevitably result if more
than one body of law governs a given contract’s meaning,” wrote
Justice Sandra Day O’Connor, who delivered the high court’s opinion.
“Under a
conceptual rather than spatial approach, the fact that the bills (of
lading) call for the journey’s final leg to be by land does not alter
the contracts’ essentially maritime nature,” O’Connor said.
“When an
intermediary contracts with a carrier to transport goods, the cargo
owner’s recovery against the carrier is limited by the liability
limitation to which the intermediary and carrier agreed,” she wrote.
“The
intermediary (meaning non-vessel-operating common carrier) is not the
cargo owner’s agent in every sense, but it can negotiate reliable and
enforceable liability limitations with carriers it engages,” O’Connor
wrote for the full court, which heard oral arguments in this case Oct.
6
Return to Newsletter Front Page.
American Shipper Shippers' NewsWire
11/12/04
U.S. intermodal traffic still booming
The
Association of American Railroads reported that intermodal
freight carried by major U.S. railroads increased 11 percent to
233,559 trailers or containers in the week ended Nov. 6, from the
year-earlier period.
This was the
second highest weekly intermodal total ever, trailing only the week
ended Oct. 30.
Containers
carried by major railroads rose 12 percent to about 168,000 units in
the week ended Nov. 6, while trailers increased 9 percent to about
65,000 units.
During the
first 44 weeks of 2004, major U.S. railroads handled an intermodal
volume of 9.3 million trailers or containers, up 10 percent.
Total carloads
moved by major railroads increased 2 percent to about 343,000 units in
the week ended Nov. 6, with volume up 3.7 percent in the West and 0.8
percent in the East.
"Freight
traffic on the nation's railroads continued to run well ahead of year
earlier levels," the association said.
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CN, CPR and Norfolk Southern announce
agreement to improve freight service between Eastern Canada and US
10 Nov 2004,
CTL
CN, Canadian
Pacific Railway (CPR) and Norfolk Southern Railway (NSR) have
announced an agreement that will significantly improve freight service
between Eastern Canada and the Eastern United States, say the
companies.
The
three-party arrangement will give CN and NSR a seamless, direct
north-south routing over CPR's lines south of Montreal that will slice
as much as two days' transit time off some 20,000 annual shipments. It
will also increase freight traffic density and revenues on CPR's
wholly owned subsidiary, the Delaware and Hudson Railway.
"This
three-railroad agreement will benefit both customers and railroads.
First, it will offer CN's existing merchandise carload customers in
Quebec and the Maritimes quicker access to important consuming markets
in the Eastern United States. And second, it will enable the
participating railroads to improve the utilization of their networks
and locomotive and car fleets," said E. Hunter Harrison, president and
chief executive officer of CN.
Implementation
is scheduled to begin Nov. 19, 2004. CN-NSR traffic destined for the
Eastern U.S. will move in CPR trains on CPR's line between Rouses
Point, N.Y. and Saratoga Springs, under a freight haulage arrangement
between CPR and NSR. This CN-NSR traffic will then move in NSR trains
over CPR's line between Saratoga Springs and the NSR connection near
Harrisburg, Pa., under a trackage rights agreement between CPR and NSR.
The new agreement will cut 330 miles off the current routing used by
CN and NSR, which sees freight traffic handled more circuitously
through the Buffalo, N.Y. gateway.
"We continue
to identify and implement efficiencies benefiting shippers throughout
North America. This agreement demonstrates our commitment to
aggressively pursue opportunities to improve service," said David R.
Goode, chairman and chief executive officer of NSR.
"This is an
important initiative that takes costs out of the rail industry by
placing freight traffic on the most efficient routing without regard
to ownership. It also creates a significant source of new earnings for
our Delaware and Hudson subsidiary and is another major milestone in
improving the profitability and value of this part of our network,"
said Rob Ritchie, president and chief executive officer of CPR.
Security
TSA Proposes
HazMat Background Check Fee Rules
On
Wednesday, November 10, the Transportation Security Administration (TSA) issued
a proposed rule and will soon issue an interim final rule implementing
several aspects of the background check requirements for drivers with
hazardous materials endorsements
as required by the USA Patriot Act.
The rules will require the states to indicate whether they will
collect and transmit driver fingerprints or whether they will allow
the designated TSA contractor to perform these functions. The rules
also propose the fees to be charged in connection with the background
checks. We expect these fees to be between $83 and $103 in states
that select the TSA contractor to collect fingerprints.
The fees assessed in states that perform the fingerprint collection
function themselves likely will be higher, as the rule does not
establish a ceiling on the state-based fingerprint collection fees.
ATA will be submitting written comments on the rules. For additional
information, ATA members may contact Rich Moskowitz at (703) 838-1910
or
rmoskowitz@trucking.org
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American Shipper
Shippers' NewsWire
11/12/04
U.S. container seal requirement may start with C-TPAT, official says
The U.S. Department of Homeland Security
continues to work on a regulation mandating importers use
tamper-evident, mechanical seals for all incoming ocean containers,
but may decide that trusted shippers in the Customs-Trade Partnership
Against Terrorism program do so sooner as an interim step until they
can properly promulgate a rule, a key cargo policy official said
Tuesday.
DHS officials said in September they
intend to follow the recommendations of the industry-led Advisory
Committee on Commercial Operations, which called on the government to
demand the use of more secure seals at the point of stuffing to
protect against terrorists and that ocean carriers certify that the
seal has been properly placed on the container before loading on a
vessel.
Elaine Dezenski, deputy assistant
secretary for border and transportation security at DHS, said in
remarks to the Homeland Defense Journal Conference Tuesday that the
department is considering quickly implementing the same requirement
for shippers in the C-TPAT program as a temporary safeguard until a
formal rulemaking is completed.
"There is no seal that will prevent
intrusion, but we want to be able to detect it if it happens and be
able to interdict it, or factor the event into our risk assessment
score so we have a better chance of catching a high-risk shipment,"
Dezenski said.
Agencies generally go through a lengthy
process that requires issuing notices and receiving comments from
industry and other concerned parties before a final rule can be
published in the Federal Register. Customs and Border Protection,
which manages the C-TPAT program, can make immediate administrative
changes to C-TPAT without a formal review process because C-TPAT is a
voluntary partnership program.
About 7,100 importers, carriers and
transportation intermediaries have signed up to have their supply
chain security plans certified by CBP in exchange for faster clearance
of their shipments at the border. Many importers are requiring their
suppliers and service providers to similarly correct security
vulnerabilities in their operations.
Meanwhile, real world testing of
electronic seals and container security devices that combine sensors
and wireless communication to immediately transmit an intrusion alert
have not produced a silver bullet yet, Dezenski said. Operation Safe
Commerce and other pilot programs have demonstrated that "there is a
lot of technology available, but less than we thought was really ready
for prime time," she said.
Electronic seals continue to have an
unacceptable alarm rate, said Dezenski, who was recently promoted from
director of cargo and trade policy.
"To use this technology in the field the
alarm rate needs to be less than 1 percent, which means we are
virtually cutting out the possibility of a false alarm. The reason the
levels need to be so small is because we don't have the resources to
interdict a container every time we have an alarm go off, particularly
in a foreign arena.
"If we are going to rely on electronic
surveillance technology we need to make sure the integrity of the
equipment is as robust as possible before its use is required," she
said.
She reiterated that the Science and
Technology Directorate estimates it will take another three years
before it can endorse a container security device for limited
deployment and five years for universal deployment on the millions of
containers in the system.
At the same time, DHS continues to
develop performance standards for container security devices to detect
light, radiation, changes in weight and other indicators that a box
has been compromised.
When the standards and technology are
ready the department will determine whether to provide incentives for
their use, perhaps as a C-TPAT prerequisite, or issue a regulation
mandating their use for the entire industry.
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American Shipper
Shippers' NewsWire
11/10/04
TSA issues plan to tighten air cargo security
The U.S. Transportation Security
Administration issued long-awaited proposals to strengthen air cargo
security that include tighter rules for freight forwarders, airports,
aircraft operators and foreign air carriers designed to prevent
terrorists from using the planes as weapons against targets on the
ground or from carrying explosives on a plane.
The proposed rules, more than a year in the
making, include enhancements to the “known shipper” program for
shipping freight on passenger aircraft. Frequent shippers who meet
certain security requirements are allowed to ship goods on passenger
aircraft. Carriers and freight forwarders are required to screen
allowable shipments. The new rules are intended to make sure freight
forwarders are following the security requirements and would extend
the criminal history background check required of workers in secure
airport areas to workers who handle cargo in warehouses outside the
airport. Currently these workers are not screened, leaving the
possibility that they could introduce weapons or explosives into a
shipment.
Screening would also extend to pilots and
other persons traveling on all-cargo aircraft to ensure they do not
pose a threat.
The rules also would expand designated
security zones in airports, and security requirements associated with
them, to cover air cargo facilities.
"We want the air cargo environment to be
treated just like the passenger environment in terms of security,"
said Elaine Dezenski, deputy assistant secretary for policy and
planning for border and transportation at the Department of Homeland
Security, at a conference Tuesday hosted by Homeland Defense Journal.
TSA also proposes to make all-cargo airlines
adhere to stricter rules that cover major airlines. Currently
all-cargo carriers operate under less restrictive security
requirements that typically govern operators of much smaller aircraft.
TSA has opened a 60-day comment period on
the proposal. Comments must be received by Jan. 10.
To read the entire notice of proposed
rulemaking and how to submit comments go to:
http://a257.g.akamaitech.net/7/257/2422/06jun20041800/edocket.access.gpo.gov/2004/04-24883.htm
.
For a PDF version go to http://www.access.gpo.gov/su_docs/fedreg/a041110c.html
and scroll down to Transportation Security Administration under
Homeland Security Department.
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American Shipper Shippers' NewsWire
11/19/04
Ridge: U.S. security depends on international cargo standards
The United States cannot defeat
terrorists without the cooperation of like-minded nations, but more
work on common international technology standards and consistent
screening procedures are necessary to increase the effectiveness of
border security measures, U.S. Homeland Security Secretary Tom Ridge
said.
The top domestic security official said
nations need to come together on a cargo security protocol in the same
way they adopted the International Ship and Port Facility Security
Code through the International Maritime Organization to identify and
close vulnerabilities at ports and on vessels. The United States is
working with the World Customs Organization, the European Union and
other bodies to get other countries to take terrorism seriously and
adopt the kinds of principles and programs the United States
Ridge told the Asia-Pacific Homeland
Security Summit that countries must also develop a set of
international standards for capturing, analyzing, storing, reading and
protecting biometric data in order to ensure interoperable access
control systems and protecting privacy, according to a copy of his
speech. Biometric data is a key component of the U.S.-VISIT passenger
screening system, as well as a universal transportation worker
identification card being developed by the Transportation Security
Administration.
In an acknowledgement that some countries
view the United States as pushing a unilateral security, as well as
foreign policy agenda, Ridge stated, "The United States is
particularly sensitive to the historical, constitutional and cultural
differences among nations. We are mindful of concerns over issues of
standards and civil liberties with respect to biometrics, biometric
passports, border security, student visas and other changes."
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New C-TPAT proposal
focuses on flexible security standards
CSCB
The
following article is excerpted from the 22 November 2004 edition of
“American Shipper”.
U.S. Customs and Border Protection has completed its second draft of
revised security standards for importers participating in the
Customs-Trade Partnership Against Terrorism trusted shipper program,
and is circulating the proposed rules among customs compliance
managers at 16 major corporations for feedback.
The new standards maintain C-TPAT as a voluntary program, but are more
direct… in spelling out security measures that importers and their
foreign suppliers are expected to take in exchange for reduced levels
of inspection and eligibility for certain automated customs payment
programs.
The new C-TPAT draft, obtained by Shippers NewsWire, move[s] away from
characterizing the measures as "minimum standards"…., and instead says
importers should apply various prescriptions as needed to correct
security gaps based on an assessment of their risk….
“Importers shall have a documented and verifiable process for
determining risk throughout their supply chains based on their
business model," the draft said. Risk may vary for companies based on
trade volumes, country of origin, transportation route and an
assessment of the potential terrorist threat based on public documents
and media reports.
The other primary change from the previous draft is that C-TPAT
importers are required to obtain written documentation indicating
whether or not their ocean carriers, terminal operators, brokers and
consolidators with whom they contract for transportation service are
C-TPAT certified themselves.
The draft standards cover requirements for selecting service
providers, container security, physical access controls, personnel,
document compliance, security training and information technology
protections. As in the original version, importers are required to
have procedures to make sure containers are packed without tampering
followed by locking with a high-security mechanical seal and
in-transit seal verification checks.
CBP officials asked members of the informal focus group to submit
comments to the agency by Dec. 3, according to an e-mail accompanying
the draft.
World Trade
The
Office of the United States Trade Representative
U.S. Announces Intent
to Negotiate FTAs with UAE and Oman
11/15/2004
WASHINGTON, DC – U.S.
Trade Representative Robert B. Zoellick today announced the
Administration’s intent to negotiate Free Trade Agreements with the
United Arab Emirates (UAE) and Oman, important steps on the path to
fulfilling the President’s vision of developing economic growth and
democracy in the Middle East.
Zoellick sent a
letter today to Congressional leaders to notify of this intent to
negotiate, in accordance with the procedures Congress established
under the bipartisan Trade Act of 2002.
Transmittal of the
letter to the Hill followed shortly after Ambassador Zoellick’s visit
to the UAE and Oman and after House Ways and Means Committee Chairman
Bill Thomas led a Congressional delegation to Oman and other countries
in the Middle East.
"A free trade
agreement with the UAE and Oman will promote the President’s
initiative to advance economic reforms and openness in the Middle East
and the Persian Gulf, moving us closer to the creation of a Middle
East Free Trade Area," wrote Zoellick. "An FTA with the UAE and Oman
will build on the FTAs that we already have with Israel, Jordan, and
Morocco, as well as the FTA that we recently have signed with Bahrain.
It will also encourage the six members of the Gulf Cooperation Council
to adopt standards that promote trade and investment. Furthermore, our
free trade agreements in the Middle East complement The 9/11
Commission Report recommendation urging the United States to expand
trade with the Middle East as a way to ‘encourage development, more
open societies and opportunities for people to improve the lives of
their families.’"
"These FTAs will
directly benefit the United States," continued Zoellick. "By reducing
and eliminating barriers to trade, a comprehensive FTA with the UAE
and Oman will generate export opportunities for U.S. companies,
farmers, and ranchers, help create jobs in the United States, and help
American consumers save money while offering them more choices."
The United States
trade relationship with the UAE is the third largest in the Middle
East, behind only Israel and Saudi Arabia. The U.S. has a combined
trading relationship of $5.6 billion and a trade surplus of over $2
billion with these two countries. Major exports to these two countries
include machinery, aircraft, vehicles and electrical machinery. Major
imports include mineral fuel and woven apparel.
Background
The Office of the
U.S. Trade Representative will work closely with the Congress over the
next 90 days, as required by the Trade Act, and expects negotiations
to commence in the beginning of 2005.
Middle East Free
Trade Initiative (MEFTA)
In May 2003, the
President proposed a plan of graduated steps for Middle Eastern
nations to increase trade and investment with the United States and
others in the world economy. The first step is to work closely with
peaceful nations that want to become members of the World Trade
Organization (WTO) in order to expedite their accession. As these
countries implement domestic reform agendas, institute the rule of
law, protect property rights (including intellectual property), and
create a foundation for openness and economic growth, the United
States will take a series of graduated steps with countries in the
region tailored to their level of development.
The U.S. will expand
and deepen economic ties through comprehensive FTAs, Trade and
Investment Framework Agreements (TIFAs), and Bilateral Investment
Treaties (BITs), and will also enhance the Generalized System of
Preferences (GSP) program for eligible countries. This Administration
has concluded two FTAs, Morocco and Bahrain; ratified a third, with
Jordan; and signed eight TIFAs with Middle East nations.
United States Trade
Agreements
U.S. FTAs: These are
reciprocal and ambitious agreements that open markets and strip away
barriers across a broad array of goods, services, and agricultural
products.
TIFAs: The United
States has TIFAs with a number of countries to enhance bilateral trade
and coordinate regionally and multilaterally through regular
senior-level discussions on trade and economic issues. The TIFAs
create Joint Councils that consider a wide range of commercial issues
and sets out basic principles underlying the nations' trade and
investment relationship.
BITs: These
agreements level the playing field and ensure that U.S. investors are
protected when they establish businesses in other countries. By
safeguarding foreign subsidiaries of U.S. firms, BITs help promote new
U.S. exports to the markets of BIT partners. BITs also protect the
interests of average American investors, whose stock and bond
portfolios often include stakes in foreign-invested firms.
U.S. Trade Agenda
The United States is
working to open markets globally in the Doha WTO negotiations;
regionally through the Asia Pacific Economic Cooperation (APEC) and
the Free Trade Area (FTAA) of the Americas negotiations; and
bilaterally, with FTAs. The Bush Administration has completed FTAs
with 12 countries -- Jordan, Chile, Singapore, Costa Rica, the
Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua,
Australia, Morocco, and Bahrain. With this announcement, negotiations
are under way or about to begin with 12 more countries: Panama,
Colombia, Peru, Ecuador, Thailand, the five nations of the Southern
African Customs Union (SACU), and now the UAE and Oman. New and
pending FTA partners, taken together, would constitute America’s third
largest export market and the sixth largest economy in the world.
U.S. – Middle East
Free Trade Efforts
The 9/11 Commission Report
The U.S. government
has announced the goal of working toward a Middle East Free Trade
Area, or MEFTA, by 2013. The United States has been seeking
comprehensive free trade agreements (FTAs) with the Middle Eastern
nations most firmly on the path to reform. The U.S.-Israeli FTA was
enacted in 1985, and Congress implemented an FTA with Jordan in 2001.
Both agreements have expanded trade and investment, thereby supporting
domestic economic reform. In 2004, new FTAs were signed with Morocco
and Bahrain, and are awaiting congressional approval. These models are
drawing the interest of their neighbors. Muslim countries can become
full participants in the rules-based global trading system, as the
United States considers lowering the trade barriers with the poorest
Arab nations.
Recommendation: A
comprehensive U.S. strategy to counter terrorism should include
economic policies that encourage development, more open societies, and
opportunities for people to improve the lives of their families and to
enhance prospects for their children’s future.
The 9/11 Commission
Report - Pages 378-379
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China
logistics industry lags: experts
LOGISTICS experts in China have said that the
logistics industry in China is lagging behind in terms of scale,
system, infrastructure and services compared with the modern logistics
industry in other countries.
President of the International Forwarders
Association of China, Luo Kaifu, said recently that the general scale
of the logistics industry in China was still comparatively small,
despite it accounting for 21 percent of China's GDP.
And despite a 30 percent increase in third-party
logistics services in recent years, it remains in its infancy when
compared tothe US and Europe, both in terms of development and
value-added services.
Mr Luo went on to say that the logistics
development in China was far from perfect and that current development
in China was hampered by a government protectionism, which is leading
to monopolistic tendencies in the industry.
President of the Communication and Transportation
Association of China, Qian Yongchang, said that although the logistics
infrastructure construction in China was improving it was far from
able to adequately meet industry demands.
Return to Newsletter Front Page
American Shipper Shippers' NewsWire
11/17/04
Official says WTO
will not ‘cave in’ to domestic textile groups
Chiedu Osawke, director of the textile division of the World Trade
Organization (WTO), told an association of apparel importers in New
York on Tuesday the WTO will not be swayed from “the letter and
intent” of the decade-old Agreement on Textiles by increasingly
strident demands from domestic textile manufacturers, principally in
the United States and Europe, for some form of continued protection
for textile and apparel products after existing quotas on such goods
fall away on Jan. 1.
“We are
very much aware that this has become an issue of bitter contention,”
Osawke said, “and we have a responsibility to listen closely to the
concerns of all of our member nations and deal with them as best we
can.”
Asked by
Shippers’ NewsWire if that meant the WTO might ultimately cave in to
the domestics’ demands if a protectionist backlash after the removal
of most quotas should be stronger than anticipated, Osawke replied,
“absolutely not. Quotas are not coming back. The Agreement on Textiles
cannot be reversed or compromised.”
In
particular, Turkey’s proposal that self-triggering safeguard
mechanisms should be permanently adopted by the WTO is a non-starter,
Osawke noted.
The WTO
has estimated that, after quotas fall away, it will take two years for
“prices to return to normal levels,” he explained. For that reason, a
group of WTO members has proposed a two-year moratorium on antidumping
duties after Jan. 1, Osawke said.
Asked if
the WTO might consider a similar moratorium on safeguard mechanisms
aimed at China, Osawke said, “the antidumping proposal is only a
suggestion from some of our members, not WTO policy. Some in Geneva
think a breathing period” -- which conceivably could be expanded to
other protectionist measures, such as safeguards -- “would be useful,
but that’s currently only a matter of discussion.”
Osawke
spoke at the annual conference of the United States Association of
Importers of Textiles & Apparel (USA-ITA), a 16-year-old organization
that now has 200 members.
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Customs: EU and U.S. act on container security
The
European Union and the U.S. are taking container security measures
that "will facilitate legitimate trade through mutually acceptable
reciprocal security standards and industry partnership programs."
Adopted
within the framework of the EC-U.S. Joint Customs Cooperation
Committee, the measures include:
creation of an information exchange network,
agreement on minimum requirements applicable for
all European ports willing to participate in the U.S. Container
Security Initiative (CSI),
identification of best practices concerning
security controls of international trade.
A pilot
project is focusing on shipments transiting through both the U.S. and
the EU to test the feasibility of exchanging cargo information on
transhipments and freight remaining on board to enable customs
authorities to identify, monitor and assess the risk associated with
transhipments.
Both
sides agree that the exchange of information is a vital component of
customsÕ security actions and will define and establish standards for
sharing information.
The U.S.
has invited the EU to post liaison officers at the Customs and Border
Protection (CBP) National Targeting Center. This will further improve
the exchange of information, the sharing of best practices and the
refinement of common risk indicators on the terrorist threat.
To
facilitate trade while securing the supply chain, experts from both
sides will study the industry partnership programs in place in the
European Community and the U.S. The outcome of the study will support
further cooperation on development of mutually acceptable reciprocal
industry partnership programs.
Recognizing that emerging technologies can promote greater efficiency
and can improve security in the international supply chain, both sides
have agreed to establish a joint group of experts to explore
innovative developments and their application. |
