The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates.
On a tonnage basis about 70% of U.S. exports and imports travel by ocean vessel. Volume-wise it is the most important mode of international trade. When merchandise trade is focused on Canada and Mexico, as members of the United States-Mexico-Canada Agreement (USMCA), the motor carrier sector dominates in U.S. export flows. Since March 21, 2020 border crossings among the three USMCA nations have been restricted to essential workers due to concerns over the spread of COVID-19. This restriction has been reviewed on a month-by-month basis. As of today, it will remain in place at least until August 21.
There is also fear of further spread of COVID-19 by disembarked crews from the world’s ocean vessels and cruise ships. This has kept about 200,000 crew members in limbo since March. While these crews are still being paid for their work, they have been stuck aboard vessels with little to do other than work or sleep. Contracts for crews are under one year in duration in order to comply with the 2006 Maritime Labor Convention. Vessel companies pick their crew members up and drop them off at major ports of call. Beyond that, crew members typically fly to and from their home countries. The International Maritime Organization (IMO), which regulates international waters on behalf of the United Nations, estimates that only 20% of crews scheduled to stop work and leave their vessels during March have been able to do so. On any given day there are about 60,000 cargo vessels involved in commercial activity around the world. They are crewed by about 1 million people.
(Photo: Flickr/Michele Rinaldi)
The nature of the ocean vessel sector has exacerbated the current problem. About half of the world’s commercial vessels engaging in international trade fly so-called flags of convenience (e.g., those of Panama, Vanuatu, etc.). This serves to keep operating costs and taxes down. Also, crews can be made up of citizens of practically any country. In contrast, U.S.-flagged vessels require the crew to be only U.S. citizens – and, therefore, subject to U.S. employment laws (see 46 U.S.C. §8103 (a) and (b)).
Under these circumstances it is easy for a country to deny entry to a crew member who has finished out his contract because he is already on a conveyance capable of taking him elsewhere. However, other ports of call can act in the same way. The number of commercial flights to the crew member’s home country may be reduced and may not depart from an airport near a vessel’s scheduled port of call. Putting all these possibilities together creates a dicey situation for all those who have been working well beyond the official close of their contracts. On the other side of the coin, the drop in flights due to travel bans has left those crew members who were scheduled to work stuck at home since March.
(Photo: Jim Allen/FreightWaves)
Why not designate these crews as essential workers as was done for others in the transportation industry? Well, these were government pronouncements applying to their domestic workers and to foreign workers entering their countries on a temporary basis in order to make export or import deliveries. By contrast, ocean vessel crews can remain confined to their vessels while cranes and drayage vehicles do all the loading and unloading.
Certainly, boredom and fatigue can take their toll on crews and their vessel captains. Mistakes at sea and at port can be costly. Therefore, it makes sense for the international community to come together to work out a solution. In that regard the IMO has been urging its 174 member states to allow crew members ashore who simply wish to return home. So far 13 nations have signed the IMO’s pledge. These are Denmark, France, Germany, Greece, Indonesia, Netherlands, Norway, Philippines, Saudi Arabia, Singapore, United Arab Emirates, United Kingdom and the United States.
The importance of the ocean vessel sector to international trade cannot be overstated. It is a global industry requiring global solutions whenever problems arise. The maritime sector is also a reminder that supply chain management is just as much about the efficient movement of people as it is of raw materials, sub-assemblies and final goods. Transportation makes or breaks international trade. Well-rested crews contribute to the quality of transportation.
Click here to see other commentaries by Darren Prokop on American Shipper and FreightWaves.
