Thursday 20 November 08 - 18:15
 

Insight & Opinion

Burst that bubble

Give or take a few US politicians, no-one thinks its workable, no-one wants it, it will be expensive but it is in the pipeline. “It” is, of course, new legislation in the US compelling the screening of all US bound containers at foreign ports. 

The US Senate and House homeland security committees reached a deal, in late July, on the form that this legislation will take within the September 11 Commission Implementation Bill. Practically speaking, it envisions that all air freight will be examined within three years and all maritime containers within five years.

The outcome, simply put, if this measure is rigidly enforced, promises to be chaos. The onus is on foreign ports to undertake this scanning and if they have to go down this road there will be many negatives not the least of which will be a major reduction in annual throughput capacity due to the system slowdown generated by the scanning requirement.

In turn, this will mean a fall in service levels and the generation of significant added costs. For container ports in northern Europe, for example, many of which are already battling congestion, the potential consequences of this Bill have nightmare proportions.

Thought through at a practical level it is clear that this legislation, which will bite overseas, is basically unworkable. It is one thing to sit in Washington and decide it is a good idea but very much another to implement it in any meaningful way.

Hardly surprisingly, this view underpins the chorus of disapproval at the legislation’s coming. This includes the scathing comments of influential US importers such as Wal Mart who appreciate the potential negative impact of such a system on their supply chain logistics – significant added costs also loom for them.

At another level, it also contributes to the slightly surreal quality that is perceived to surround US politicians understanding of the shipping business – a perception that first manifested itself in conjunction with the forced extrication of international port operator DP World from the US port business. This was nothing short of a reactionary step and certainly not one based on common sense.

Politicians are often described as operating in a “bubble”, it is perhaps time that this one, which above all else seems to be home to a lack of reality, bursts.

Carly Fields

Motorship