Security in Maritime Transport Essay
create a PowerPoint presentation analyzing the impact of public policy on cargo security. You can reference the articles below or select another peer-review article, agency website, or GAO report. This presentation should be at least 10 slides. The assignment should also be in APA format with separate title and reference pages. This assignment will be graded on content, grammar, and format.Security in Maritime Transport Essay
DHS – US Coast Guard
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Containerized cargo is an ongoing security challenge for the Maritime Transportation System. With gargantuan container vessels plying international routes, it becomes nearly impossible to ensure the safety of these trade lifelines. Recent consolidation in the maritime shipping industry, combined with free-falling shipping rates, combine to cause concern for the future of containerized shipping security. Compounding the present difficulties, container ships are growing in size and capability. Where once it was possible to inspect every container on a given ship, it is now unthinkable with vessels carrying over 20,000 containers.
Maintaining security in the maritime shipping industry is critical to preparing and responding to the parallel growing security threat. Programs including the Container Security Initiative and Customs-Trade Partnership Against Terrorism apply risk-based approaches. However, with fewer market players after industry consolidation, it is time for regulators to review the success of current programs and search for new initiatives. New partnerships and outreach may use current efforts as a framework to respond in a dynamic environment to improve the industry’s overall security.
This essay presents a path forward for U.S. security professionals by providing specific recommendations for the Department of Homeland Security. By leveraging existing programs, policy-makers can make some minor changes which may pay large dividends. Regulators should take the industry’s mergers as an opportunity to engage in an effort to shape security measures in a changing environment. An understanding of the current situation requires a review of the evolution of containerized shipping and the industry’s development. A discussion of current regulatory approaches follows, with examples and the effects of recent industry re-alignment. Finally, the essay provides tools that U.S. regulators may adopt to make the industry safer and more secure.Security in Maritime Transport Essay
The Evolution of Containerized Shipping
The New Era of Containers for Inter modal Shipping
Fewer technological advances contributed more to globalization than the advent of containerized shipping. In the span of 60 years, shipping containers evolved from novelty to ubiquity. Originally designed to assist inter modal transportation by Malcolm McLean in 1955,1 containerized shipping became a lightning rod for commerce. The first container ship, Ideal X, sailed in 1956 with 58 containers from New Jersey to Houston. Because of the decreased shipping costs, mainly due to efficiencies with loading/unloading and locking mechanisms (to prevent pilfering), the idea quickly took hold.2Security in Maritime Transport Essay
The conflict in Vietnam created a large demand for McLean’s containers.3 With the U.S. military needing a way to quickly and efficiently move massive amounts of war materiel to the jungles of Southeast Asia, containers saw heavy use. By 1968, McLean’s containers had the industry’s attention, with the International Organization for Standardization (ISO) issuing its first standard.4 Shortly thereafter, the ISO issued additional standards in identification and size, giving rise to the 20 and 40 foot common containers in use today. This set the groundwork for a new form of low cost inter modal transportation.
While ports initially resisted the shift to containers,5 the cost savings of up to 50% was hard to ignore. When international maritime trade boomed, ports quickly came onboard. By the late 1960s, ships slid down the ways with the ability to carry 1,000 TEUs (twenty- foot equivalent units). While this pales in comparison to the 20,000+ TEU vessels available today, 1000 TEU was enormous for its time. The number of countries with ports capable of servicing container vessels jumped from 1% in 1966 to 90% in 1983. Costs to ship cargo dropped dramatically from nearly $6/ton to less than $0.25/ton.6
With rapid expansion, many companies initially tried to cash in on the inter modal container craze. However, competition grew fierce and industry consolidation began. Paralleling the railroad consolidation in the U.S. in 1980, containerized shipping evolved into a business run by giant operators. When the dust settled, the entire market, responsible for transporting trillions of dollars in global trade, consisted of ~10 companies.Security in Maritime Transport Essay
Current Market State
Since 2000, the shipping market has consolidated. While the top three shippers combined for 23.7% of overall market share, by 2016, the same top three companies comprised an astonishing 39.9% of the market.7 The top shipper, Maersk Sealand, expects to continue growth through 2017 in the wake of Hanjin Shipping’s bankruptcy in 2016, pushing the top three shippers to an estimated 42.8% market share.8 The main reason for consolidation is the pace of mergers and acquisitions in maritime shipping, with five major shipping companies closing up shop from 1999-2016.9 Maersk Sealand alone is responsible for more than 3 million TEU in capacity, capturing nearly 15% of the global market.10
While the numbers alone are not particularly insightful, the trends provide an opportunity for analysis. The Hanjin bankruptcy is a symptom of the shipping industry’s financial troubles. While Maersk increased shipping volume by 9% in 2016, its total revenues dipped by 13%, mostly due to the sharp 21% decline in maritime shipping rates.11 The effect on maritime security may not be obvious at first glance. Still, as one looks deeper into the industry’s financial woes, new vulnerabilities emerge.
Current Regulatory Framework
Before investigating the impact of market consolidation, dipping freight rates, and the evolution of containerized shipping, it is important to look at the current state of security programs. The three primary security initiatives directed at maritime container shipping include the Container Security Initiative (CSI), Customs-Trade Partnership Against Terrorism (C-TPAT), and the International Ship and Port Security (ISPS) code.12 Each, in turn, provides its own benefits to maritime security that may require re-evaluation in the face of industry changes.Security in Maritime Transport Essay
Container Security Initiative
The United States developed CSI as a response to the September 11, 2001 terrorist attacks.13 U.S. officials were quick to identify maritime shipping as a possible threat vector for terrorism. The program’s “core elements” are to 1) identify high-risk containers, 2) employ screening before shipping, and 3) leverage technology to prevent impeding commerce. It is the only program of the three identified with the sole focus of improving container security. The program has seen uncertain success, but in 2017, the program boasts that it prescreens over “80 percent of all maritime containerized cargo imported into the United States.”14Security in Maritime Transport Essay