Travel, Ports, Shipping and Courier Services

November 3rd, 2020

True economic diversification can take place through transforming the maritime industry by focusing on key expansion and investment opportunities.

Photo: Stephen Broadbridge

The COVID-19 pandemic has presented an opportunity to reflect on the significant implications that the region is facing, and those issues we will need to manage innovatively and decisively to mitigate to secure the future of regional shipping.
The effect of the pandemic on global shipping is echoed to varying degrees in the Caribbean. However, given our position in the supply and demand of global trade and services, there is tremendous opportunity for professionals in all spheres of the region’s maritime sector to assess the impact of COVID-19 on our shipping industry, and to work to influence a strategic agenda and environment of recovery and sustainability. 

In Trinidad and Tobago, since the advent of the COVID-19 pandemic, and the imposition of restrictions placed on the movement of non-essential players in business and consumer services, the shipping community has seen a significant reduction in the inefficiencies (and associated costs) related to vessel and cargo clearance operations at the nation’s ports. With the (forced) restrictions bought on by the need for physical distancing and the like, hitherto long-advocated-for automated clearances could suddenly be facilitated, more than doubling the efficiency associated with moving goods through the supply chain; from pre-clearance to delivery to the consignee. The benefits derived from going automated in a period of scaled-down clearances – due to reduced volumes being cleared, can only be multiplied from achieving full automation – moreover digitalisation, in a fully operational state.

The crisis response has demonstrated that it is through sheer will, and deliberate willingness to relinquish long-held and outdated practices which add no value and merely render our trading across borders and shipping services highly uncompetitive, that we will be able to achieve a more efficient, and therefore, effective trade-facilitating and enabling environment.

A New Sense of Urgency – Not Business as Usual

The Shipping Association of Trinidad and Tobago (SATT) has put forward a series of recommendations for economic recovery, resilience and sustainability – even in the face of a persistent pandemic – from policy through to operation, which can serve to significantly elevate our performance as a trading nation.

This includes but is not limited to:

  • Accelerated integration of all regulatory agencies across a single platform (TTBizLink, the nation’s Single Electronic Window), with the maximum adoption of digital technology; including capabilities for electronic signature and electronic payment;
  • Full deployment of container scanning with the simultaneous scaling down of the Container Examination Centre (CES); and
  • The accelerated introduction of the Revenue Authority, whose structure is expected to (and must) strengthen governance and oversight – and therefore accountability – over the Customs reform agenda in respect of our trade facilitation obligations on the WTO Trade Facilitation Agreement.

Scaling up the entire trading environment from policy to regulation through to operations, could provide a much-needed boost to our overall economic well-being, particularly as we continue to experience a change in our economic fortunes. 

With the momentum and sense of urgency brought on by the pandemic, the Government of the Republic of Trinidad and Tobago (GORTT) has the opportunity to finally make good on the promise to diversify the economy, away from oil and gas. The fragility of commodity prices; which is expected to be sustained for some time, makes it all the more critical to adopt urgent and aggressive diversification strategies.

A Call for Greater GORTT Business Facilitation for Viable and Impactful Maritime Industry Projects

True economic diversification can take place through transforming the maritime industry by focusing on key expansion and investment opportunities.  Opportunities exist for expansion of business/investment in the areas of bunkering, ship-to-ship (STS) operations or transshipment, repurposing the abandoned Petrotrin fuel tanks, and the Sullivan Island Project.  The Sullivan Island Project, in particular, will address most if not all of the needs for the establishment of an Inbound and Outbound Port and Logistics Hub.

What these projects require from the GORTT is not capital, but rather they require a focused facilitating orientation, where the GORTT’s role would be to ensure the necessary checks and balances are carried out expeditiously and cost-effectively, and in a manner which redounds to the benefit of the country while rewarding the risk-taking investors.  

Industry self-regulation can also be a valuable tool for accelerated capacity building. Uniform standards and practices are a central feature of all technological and other advancements and this will provide stakeholders with the platform to develop, adopt, and achieve the required standards and practices.

Express Courier Services

Passenger freighters account for a significant volume of air cargo capacity; in the form of belly capacity. Consequently, imposed travel restrictions and border closures would have caused significant capacity in the Express Courier Service segment to be withdrawn.

Locally, there are two major air freighters; both have reduced their weekly carrying capacity by one-third since COVID-19 restrictions, which is consistent with figures reported by the International Air Cargo Association that suggests that globally, a 26%-35% decline in capacity has been registered as of mid-May, compared with the same period in 2019.

Operating as an essential service alleviated some logistical challenges. Nevertheless, the lockdown and social distancing created its own challenges for deliveries, and as such, some courier companies suspended deliveries and implemented pick-up points. 

The drivers of consumer spending are for the time being down pressed, and recovery is expected to be slow.  Online shopping and retail delivery will expand and play a part of the new normal, but things will only look up for those who are able to weather the initial storm.