Global Shipping In Crisis: World Leaders Ignoring The S.O.S.

How many more signals do world leaders need to see to believe that global shipping is an industry in meltdown?

Between 200,000 and 400,000 seafarers are stranded in vessels around the world. They have been unable to leave their ships due to COVID-19 restrictions. They are the ones responsible for running the engines of economic growth, as these ships power 90% of the global economy in terms of transferring commodities and goods around the world, while other forms of transportation like global aviation have essentially closed down.

Stress and fatigue are mounting among crew. The industry already had 2,815 shipping incidents by July 2020, with certain categories of vessels seeing safety issues shoot up 20% this year, and while Q3 numbers are not out yet, every indication points to a rapid growth in incident rates as mariners’ stress and fatigue reach unprecedented levels.  Shipping insurance giant, Allianz highlighted this risk by saying that the “consequences of coronavirus and a sustained economic downturn could threaten long-term safety improvement and trigger an uptick in losses from cost-cutting measures, fatigued crew, idle vessels and weakened emergency response.”

A humanitarian crisis on the oceans

The UN Secretary General has had to intervene not once, not three times on this issue over the summer alone, describing conditions in modern shipping as a humanitarian crisis, and called out the shipping industry for not making enough progress on sustainability.  Even the Pope has called for divine intervention.

Of the 1.2 million sailors employed in the maritime industry on international routes, over 200,000 have been stuck on vessels for months past their crew shift changes.  They often stay in cramped cabins in factory-like conditions.

A survey by the International Seafarers' Welfare & Assistance Network shows how serious the issue is.  The number of seafarers they had to assist increased by over 700% in 2020 compared with the same period last year.  The numbers rose from 4,316 between January and July 2019 to 30,563 for the same seven month period in 2020.

Four major issues: unchecked for too long

Editor of leading maritime publication gCaptain, John Konrad, put out an emotional appeal for rapid intervention into the industry.

He called out four major issues in the global shipping industry that had gone unchecked for far too long:

1. Ship Safety

2. Sustainability

3. Gender parity

4. Racial diversity

In his 45 minute video, Konrad listed 26 active incidents that the gCaptain shipping news site is covering, with a range of examples of ships exploding, sinking, and crashing. 

He raised the question of whether many of these incidents were a combination of years of weakening safety standards on ships that had now been accentuated with COVID-19.

‘Flags of Convenience’ responsible for lowering ship safety standards

With the Wakashio oil spill in Mauritius, explosion on the MV New Diamond off the coast of Sri Lanka, and the Gulf Livestock 1 heading straight into the eye of a powerful typhoon, questions are now being asked how much of this was caused by underinvestment in safety systems processes, training, and technology.

Such incidents happen outside the eyes of the public, as the majority of global shipping continues to be listed in shell companies in obscure offshore locations, such as Panama, Marshall Islands, and Liberia, where 50% of all large ocean ships are registered.

These three countries are known for having a lower inspection enforcement regime than other jurisdictions.

It may be more than a coincidence that three of the biggest shipping disasters in the last two months, the Wakashio in Mauritius, Gulf Livestock by the coast of Japan, and MT New Diamond coast of Sri Lanka, were all registered in Panama.  Panamanian Maritime Authorities’ accounts of the Wakashio crash in Mauritius went against satellite imagery published three days before the Panamanian statements were made.  This has already thrown in doubt the credibility of the Panamanian Maritime Authorities’ ability to conduct a thorough independent investigation into an incident that has caused national protests in the country and threatened to bring down the government.

All the Mauritian opposition parties have been calling for greater transparency with how the Wakashio is being handled. The former President of Mauritius, Dr Ameenah Gurib-Fakim - who is nonpolitical (the President has the same role as the Queen of England compared with the elected Prime Minister) - was on BBC News last week calling for assistance from reputable ship incident investigators from countries that lead the world in accident investigations, and who can advise an independent Mauritius inquiry into the Japanese vessel’s sinking. 

Panama is the registrar of the vessel, and whose inspection regime was responsible for vessel safety.  Japan is heavily involved in the incident, with a Japanese vessel owner, Japanese vessel operator, and a major Japanese insurance firm (Japan P&I club).

Here are the big four issues that the global shipping industry has ignored for too long.

1. Ship safety

The shipping industry loses between one and two large vessels each week on average, often with loss of life. This year is going to be worse. 

The unfolding sailor situation on ships is leading to increasing maritime safety incidents.

Already in 2020 alone, there has been a 20% increase in incidents with car carriers and roll-on roll-off car ferries, that require rapid turnaround of vessels at each end of the journey.  The number of total losses have increased as well as the number of reported incidents (currently at 188, which is 20% above 2019 figures).  

On 12 June 2020, the UN Secretary-General, Antonio Gutteres, said that he was “concerned about the growing humanitarian and safety crisis facing seafarers around the world.”  He went on to explain that “Hundreds of thousands of the world’s 2 million seafarers have been stranded at sea for months.  Unable to get off ships, the maximum sea time stipulated in international conventions is being ignored, with some seafarers marooned at sea for 15 months.”

Two weeks later, on 23 June 2020, he was calling this an unsustainable humanitarian crisis.

In the last two months alone, three major incidents have taken place by Panama-flagged vessels.  The Wakashio ran aground on the island of Mauritius in mysterious circumstances and has led to the worst oil spill in the country’s history amid a network for biodiversity hotspots.  The country is still under a state of national environmental emergency.

The families of 40 crew missing from the Gulf Livestock 1 continue to appeal to Japan not to end its search and rescue mission, after the ship sailed straight into the eye of a powerful typhoon earlier this month.

Around the same time, a massive oil supertanker passing by Sri Lanka’s coast, the MT New Diamond, experienced a boiler explosion and put the entire South East coast of the large Indian Ocean island at risk of a major oil spill involving 2 million barrels of oil.

It is typical for  Panamanian ships to have safety incidents, but the global coronavirus pandemic is increasing these numbers and now extending the problem to countries with stricter standards and the best marine investigations, such as the United States.  In August four crew died and many more were injured when an American dredging vessel, the Waymon L. Boyd, exploded in the Port of Corpus Christi, in Texas.  The investigation of the cause of the incident is ongoing there, amid concerns the vessels may have hit a propane pipeline during its operations.

How many of these incidents are due to poor procedures on board vessels that ship owners put in place amid the coronavirus pandemic.  Ship operators and owners have had at least 7 months to understand and prepare for the global pandemic, and serious questions must be asked at their failure to address these issues.

Organizations like the Maritime Union of India and the International Seafarers' Welfare & Assistance Network continue to speak up at how the needs of seafarers are being discarded.  The Maritime Union of India was particularly concerned that the captain and crew of the Wakashio were being made scapegoats by the Panamanian Maritime Authorities, when deeper questions needed to be asked about the Wakashio shipping incident, and have been repeatedly raised by no answers have yet been given.

2. Sustainability

Shipping is still one of the most polluting industries in the world.  If it was a country, shipping would be the 6th largest in terms of carbon emissions.

The size of global shipping has grown by 1500% in the last 50 years.  So while the number of vessels has remained approximately the same at 60,000 large oceangoing ships, it has been their size that has ballooned to 2.5 times the size in 2000.  Imagine if that happened to all the cars on the road.

Even the proposals from the Japan-dominated Environment Council of the UN shipping agency, the IMO, is only 25% of the ambition level needed to meet global climate goals.

On September 23, the UN Secretary General urged for a change in global shipping.  He called for urgent change, saying, “Shipping activities must be balanced with the long-term health and biodiversity of the oceans.“

This means that shipping continues to act as a 500 billion dollar subsidy on the entire oil industry by agreeing to burn the heavy residual fuel at the end of the refining process that would otherwise require the oil industry to pay for expensive and safe disposal.

Ocean Conservancy released a report on Monday calling for greater urgency in the shipping industry in order to have the first commercially viable set of fossil-free vessels rolling off the production line by 2030  - less than a decade away.

 The world's scientists have given governments an industry ten years to change.

 Shipping continues to act as a bête noire.

 If shipping is unable to change itself, change must be thrust upon it.

 3.    Gender Parity

There is also a major gender crisis in global shipping.  

In 2019, the UN shipping agency described the year as ‘Supporting Women in Maritime,’ and made a range of impressive-sounding initiatives.   However, none of the powerful IMO Committees are chaired by women.  Nor are there enough women among the senior ranks of the IMO.

Despite Mauritius placing a strong emphasis on gender balance in its response to the oil spill to date, of the almost 100 international consultants sent to Mauritius, 100% have been men.  For an industry that has talked loudly about promoting women in maritime, that’s more than an oversight.  The structural issues have gone unchecked for too long.

It is not as if the maritime sector lacks capable female leaders.

John Konrad read a list of strong leaders in the maritime sector who are all female, saying “We have leaders like Dr. Sylvia Earle, Astronaut Kathryn Sullivan of NOAA, Dawn Wright, oceanographer and Chief Scientist of ESRI.

I have daily discussions with Ally Cedeno of Women Offshore and she works harder than anyone I know and has so much more work to do. In 1974 WISTA was formed and that same year Kathy Metcalf first walked down the passageways of King’s Point, among the first women to attend any service academy.  46 years and there is so much more to do.

Meanwhile, a battle has been fighting on social media over sexual harassment and rape and nobody is certain of the facts but everyone acknowledges it’s shaking some of our most valued institutions to the core.

The US Secretary of Transport, Elaine Chao, a female minority of the highest intellect and deepest heart, but she get’s villainized by the press for conflicts of interest when she supports shipping.”

So why has the shipping industry not taken gender equality seriously enough?

After every industry faced its awakening with the #MeToo movement, did the global shipping industry believe it could just sail by unnoticed?

4.    Racial Diversity

The lack of diversity extends beyond gender to the lack of racial diversity.

A look at the Boards and Senior Executives among all the major shipping companies and regulators, and another familiar pattern starts to emerge.

Where is the racial diversity?  It is not for a  lack of talent.

gCaptain explained this again in the John Konrad video.

“What has stuck most in my mind since COVID started is the one man in our industry who has fought harder than the rest. Captain Robert Cook, president of the Organization of Black Maritime College Graduates who has been fighting for the advancement of his members for 27 years.

27 years and countless young, bright, talented OBMG cadets have graduated, entered our industry and have risen to the ranks of Captain, Chief Engineer, and Pilot. Not bad. I’m a captain myself, and proud of that achievement. But look around the Boardrooms of our industry’s leadership and you will see his job is not finished.”

The shipping industry and the UN agency, the International Maritime Organization, is particularly effective at putting our copious amounts of marketing material for World Maritime Day and other annual celebrations. 

However, how serious is it trying to address its diversity challenge.

Even compelling reporting from organizations under its responsibility will start to change behavior, yet this is not being done at anywhere near a serious level.

Sending out an S.O.S.

Taken altogether, this is an industry sending out an S.O.S.

The Pope, the UN Secretary-General Antonio Gutteres, business leaders such as Sir Richard Branson have been calling for major reform to the industry.  French President, Emmanuel Macron has gotten burnt in both Beirut and Mauritius with shipping incidents that caused political fallout. Canadian Prime Minister Justin Trudeau has attempted to put ocean issues on the G7 agenda at Charlevoix in 2019 and is also a member of the controversial ‘High Level Panel on a Sustainable Ocean Economy.’  150 million people in six countries around the Red Sea wait with baited breath to see whether the 1 million barrels from the disintegrating oil tanker will be removed in time.

Captain Andrew Kinsey, a senior marine risk consultant at marine insurance giant, Allianz, was quoted in Allianz’s 2020 Safety and Shipping Review as saying, “Shipping will increasingly be drawn into geopolitical disputes.” He is wrong.  The shipping industry is now directly responsible for causing geopolitical disputes.

And regarding the UN shipping regulator, the IMO, it has shown that it is an agency that cannot fix itself.  It is therefore the role of the G20 to intervene.  The group of G20 most powerful countries have economies that cover 80% of world trade, much of which is transported by ships.

The G20 stepped up on Tax Havens.  They have taken on the Climate Crisis.  Over the past few years, they have increasingly looked into intervening into Ocean Health.

The report card on global shipping is damning.

It is by far the greatest laggard of all the transportation industries.

The world is running out of time to avert runaway climate change.  So too is the shipping industry.