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Industry Backgrounders: Shipping

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Innovative transportation technologies have accelerated the transshipment of goods around the globe. Containerization, larger and more efficient ships, roll-on/roll-off cargo container vessels, more efficient port management, improved logistics, and satellite navigation and tracking all became part of a critical circulatory system within which globalization itself was able to flourish.

In 2007, the volume of international seaborne trade reached an unprecedented 8.02 billion tons; in addition, the total air freight transported worldwide accounted for 41 million tones on 29.3 million scheduled flights, serviced by 3,730 different airports around the globe. Since 2003, global container trade has averaged double-digit growth annually. Even in the midst of a global economic slowdown, at any given moment, there are some 20 million intermodal freight transport containers moving around the globe. More than 4,600 ships carry those containers on over 200 million trips per year.

However, as the global flow of legitimate goods has grown, so has the transshipment of illicit items – small arms, drugs, counterfeit products, and perhaps most worryingly, weapons-useable materials and technologies. In response, governments have introduced an array of rigorous security measures to help weed out contraband from the legitimate supply chain. The Customs-Trade Partnership Against Terrorism (C-TPAT), the Container Security Initiative, the World Customs Organization SAFE Framework with its Authorized Economic Operator (AEO) guidelines, and the SAFE Port Act of 2006 are just a few examples.

As with the dual-use technology sector, these additional regulations layered onto other industries in the wake of the 9/11 terrorist attacks have elicited push-back from industry, rather than facilitating meaningful partnerships with mutual benefit. For instance, four years after 9/11, the Bureau of Customs and Border Protection (CBP) inspected less than three percent of the 20 million inbound shipments to the United States annually. Unable to effectively police the supply chain, CBP introduced C-TPAT, which mandates that U.S. companies help shoulder the burden of cargo screening. While a reasonable premise, many have complained that participation in C-TPAT – today a near necessity for all major companies in the sector – offers few meaningful incentives.

Identifying more effective ways to transform shipping from a conveyor belt into a “choke point” for illicit items without hampering the competitiveness of legitimate industry will be critical for proliferation prevention and other counter-trafficking efforts.

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Related Links

Oceans Beyond Piracy

World Shipping Council


Security Container Initiative

World Customs Organization SAFE Framework

SAFE Port Act of 2006


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