Anticipating opportunities, bracing for competition

In the face of today’s challenging economic reality, it has become increasingly important for businesses to prepare themselves to manage change and anticipate opportunities. While the dynamism that is inherent in the shipping industry has constantly forced us to stay on our toes, the prevailing circumstances demand that we cultivate deeper foresight, broaden our vision and deploy more comprehensive and far-reaching strategies that will deliver successful outcomes in these difficult times.

In the eight years that have elapsed since the Panamanian government formally announced plans to expand the Panama Canal, several regional territories have advanced discussions and plans to position themselves to benefit from this significant development. Today finds many of the competing ports in these countries at different levels of preparedness; and with the completion of the expanded Panama Canal being revised from this year to late 2015, there is precious little time left to get things in order.

Widely regarded as a catalyst for tremendous commercial activity in the region, the Panama Canal expansion project promises to provide greater trading opportunities by facilitating the crossing of larger New Panamax ships between the Pacific and Atlantic oceans. When the new locks of the canal swing open, one of these vessels will be able to steer nearly 15,000 teu through the upgraded transoceanic waterway. This is three times the volume of cargo transported through the canal today.

The bigger picture

In preparing themselves to accommodate these larger cargo ships and better serve the global shipping industry, several Caribbean ports continue earnestly to pursue activities related to harbor dredging, port facility improvement and the development of logistics facilities.

While our regional ports maintain a laser-like focus on the Panama Canal expansion project, it is important not to lose sight of the bigger picture as other major infrastructure projects with direct implications for the Caribbean loom on the horizon. Heralded as the largest civil engineering and construction project in the world, the proposed $40 to 50 billion Nicaragua Canal project is one such undertaking that is poised to change the landscape of world maritime trade.

With construction slated to commence later this year and run through to 2020, the Nicaragua Canal will seek to offer an alternative transoceanic trade route that is wide and deep enough to accommodate Post New Panamax (15,000 teu) and Maersk’s Triple E class (18,000 teu) vessels. These newer, ultra-large ships will not be able to transit the expanded Panama Canal.

Whether the proposed Nicaragua Canal will rival or complement the Panama Canal remains to be seen; but whatever the outcome, there are several pertinent questions that we still need to ask ourselves. How will this project affect route dynamics in the region? Should Caribbean ports seriously consider mobilizing additional investment in deeper harbors and larger cranes? What are the ramifications of a potential Caribbean coast port development component of the project? Will there be sufficient trade to support two canals a few hundred miles apart?

These and other questions will be addressed at our upcoming 44th AGM, Conference and Exhibition, which is scheduled to take place in Punta Cana, Dominican Republic, from 11 to 15 October. 

Dr Paul Oquist Kelley, Minister/Secretary for National Policies of the Nicaraguan Presidency and Executive Secretary of the Commission of the Nicaraguan Grand Interoceanic Canal, will make a comprehensive presentation outlining the many themes emanating from the project.

While it is not set as an agenda item, the issue of the response that will be made by the Suez Canal Authority in the face of the investments in Panama and Nicaragua cannot fail to be a pertinent consideration for us in the Caribbean and Central American region.

The CSA’s 44th AGM, Conference and Exhibition will serve to connect shipping industry players with new ideas and opportunities that will allow them to remain viable in the competitive global market. I am certain that all the participants will enjoy the discourse and planned events, and I look forward to meeting you and continuing the dialogue during the conference.

Grantley Stephenson
President, Caribbean Shipping Association

Other issues

In addition to the topic of canal links in Panama and Nicaragua, a number of other burning issues will be up for discussion at the CSA’s 44th AGM, Conference and Exhibition. They include the state of the cruise industry in the Caribbean, the role of tug services in the competitiveness of terminals and shipping lines, marine litter, natural gas energy and the design and optimization of cost-effective warehouses.

As it relates to the cruise industry, it will be interesting to explore the present situation and future prospects for the region, especially in the face of growing competition from Gulf Cooperation Council (GCC) states such as the UAE and Oman. The alliance formed among these destinations has strengthened their push to attract greater cruise ship traffic to the Arabian Peninsula, and this will undoubtedly force Caribbean countries to develop countervailing strategies to ensure continued growth in this region.

On the matter of tug services and their impact on terminal competitiveness, the conference will delve into the concept of privatization of towage services and how this is likely to sharpen the competitive edge of regional ports. I am sure that participants will be keen to hear how this model proposes to foster growth by shifting the financial burden away from governments while instituting best practices and appropriate technologies that will efficiently deliver value-for-money services.

The need for us to be responsible stewards of the environment occupies a position of primacy on the conference agenda. Expert presenters will speak to preventing and managing marine debris, as well as the utilization of natural gas as an environmentally friendly fuel alternative that releases lower emissions of sulfur dioxide and nitrous oxides.

Participants at the event will also have the opportunity to learn about streamlining warehouse operations to world-class standards and the benefits that Caribbean ports can derive from implementing the Automated System for Customs Data (ASYCUDA) to enhance the delivery of customs services.