What do oil spills, piracy and the Greek crisis have in common?
There are at least three received truths, as one of my college professors sarcastically called them, that, in the world of shipping, may be open to challenge. One is that last years Gulf of Mexico oil rig explosion had nothing to do with the rest of the shipping industry, being only about wells and rigs and not ships.
Another truth that is repeated constantly is that weve got to do something about piracy, particularly the Somali variety, and that if our industry musters the will, whatever that is, the world will listen. And the third is that Greeces (and Europes) current economic and political passion play has, and will have, no relevance to the Greek-owned shipping sector.
In my more than 40 years in shipping, Ive learned that like most businesses, ours is dominated by relatively few voices, functioning within an echo chamber of mutually supportive expressions of internal consensus. These voices do not always take account of uncomfortable events outside: a failure that brings unpleasant surprises from time to time.
There are a number of reasons why the three truths, that I have referred to, arent actually true at all.
Truth no. 1 ignores the fact that sound risk management, as a good classification society will tell you, requires a programme that implements principles embodied in the International Safety Management (ISM) Code, the U.S. Oil Pollution Act (OPA 90), SOLAS and MARPOL. These principles, particularly stringent internal and external audit procedures in other words, sound corporate governance were notable for their absence leading up to every major oil spill up to and including (you guessed it) last years in the U. S. Gulf. They apply to shipping companies just as much as they do to oil companies and offshore rig operators. Perish forbid that the great and good should publicly take note of this.
Truth no. 2 maintains that the Great Powers are minded to heed the pleas of some of us, and take concerted action against Somali and other pirates. This is implicit is the mantra: something must be done. A related school of thought has been active in promoting the belief that mercenaries can be put into smallish private navies, and counter-attack the skiffs and mother ships. Well, of course this is possible, but the enormous liability exposure that it would entail has, it seems, not been fully considered. As for the notion that the Obama administration or China, or another Great Power, is willing to take on the pirates, that too is possible just. There are reasons, though, to doubt that any such thing is likely.
One is that the rise of Al Qaeda in the Gulf of Aden area is of greater concern to certain powers than a little thing like piracy, and that the said pirates or their tribal colleagues are adroitly selling their services, as allies, to certain famous intelligence agencies.
A second reason is that after the less-than-stellar performance of NATO & Co. re Libya, and the forthcoming U. S. skedaddle from Afghanistan, evidence exists that further military activities are being discouraged, for now. I cant refrain from adding that our industrys leaders have not been good at burnishing our image not that theyve tried very hard with the result that our political leaders have very little stomach for pounding Somali villagers, and their husbands, with predator drones, J-Dams and Seal Team Six.
Yes, I know about the poor seafarers, but do they have effective spokesmen in the councils of the mighty? Show me. If something CAN be done, I dont think were there yet.
Truth no. 3, that the Greek shipping sector is (more or less) unaffected by the increasingly messy situation in that country, has more merit than truths 1 and 2. Most Greek shipowners of my acquaintance have been careful not to get too close to Greek banks, much less the government. They tend, with good reason, to prefer foreign flags, foreign banks and foreign corporate domiciles. Those however who say that the present crisis will leave no imprint on the mind of the Greek shipping sector are mistaken. The present spot of trouble only confirms the traditional sectoral belief that its best not to put all ones eggs in one basket, or ones ships under the blue ensign.
Those of us who remember the fervent efforts of successive Greek governments to woo shipowners back to the Greek registry realise that the present developments are likely to be unhelpful. Social unrest is growing. Greece is insolvent: its debt load is now about 160% of its GDP. Greece is a rare and maybe the only country where shipping is still regarded as a fundamental national asset, accounting for nearly 30% of GNP. Shipping has for many years enjoyed preferential tax treatment. Posidonia, Greeces famous biennial maritime bash, is the industrys foremost global trade fair. While none of these is really at risk, there is a growing realisation that a companys identification with Greece will sometimes be unhelpful in the global financial markets.
On the other hand, it has long been said that when times are bad in Greece, Greeks turn to the sea. Hellenic seafarer recruitment is up and is likely to grow further as shipping revives. The Hellenic shipping sector has a long history of surmounting troubles ashore. Buoyant is an apt word for it.
Clay Maitland
This article has been initially published at www.claymaitland.com