APEC TRANSPORTATION WORKING GROUP
15TH MEETING, SANTIAGO, 19-23 APRIL 1999

STEERING COMMITTEE ON
MORE COMPETITIVE TRANSPORT INDUSTRY (INCLUDING INFRASTRUCTURE)

PROJECT PROPOSAL

FACILITATION OF INTERNATIONAL SHIPPING

DELEGATION OF AUSTRALIA

NEW PROJECT PROPOSAL

PROJECT

02. APEC Transportation Working Group.

OBJECTIVES

03. The objectives/justification of the project.

Objective

The objective of this project is to develop a ‘Policy Framework’ to promote the development of efficient international shipping services in the Asia Pacific. The ‘Policy Framework’ will be drawn from an analysis of maritime policies that have successfully promoted access to safe and efficient international shipping services. Case studies will be undertaken to closely evaluate the objectives and method of implementation of maritime policies critical to sustained and sound growth in the international shipping sector.

The project will initially involve contemporary and historical analyses of maritime policy trends to determine their impact on international shipping services and trade. To ensure this research is available for future shipping studies and negotiations it will be reported separately as a ‘Study of the Impact of Maritime Policy Reform’.

Identifying effective maritime policies will provide benefits to APEC maritime administrators who will be able to assess the potential impact of policy reforms on international shipping services and trade with greater confidence. Shipping companies may also utilise the information revealed in the analysis to assess the impact of regulatory changes and policy reforms on their operations.

The outcomes of this project will provide a foundation for future cooperation among APEC economies on international maritime trade issues.

Justification

It is a founding principle of APEC that international trade contributes substantially to sound and sustained economic development. As shipping is the primary transport mode for traded goods in the Asia Pacific region, efficient shipping services are critical to regional trade and economic growth.

International shipping is a highly competitive industry which, particularly in the liner sector, has been severely affected by the shift in trade flows generated by the recent economic crises. Current shipping trends, such as global alliances and rationalization of low profit services indicate that shipping lines are re-evaluating their commercial viability. In addition to these trends the introduction of new larger vessels (ordered prior to the trade downturn) may result in considerable momentum among APEC economies to review outdated maritime policies. The proposed development of a ‘Policy Framework’ will provide APEC members with an outline of maritime policies which have been shown to facilitate efficient international shipping services and support sustained trade growth.

The proposed project will identify the impact of maritime policy changes in one APEC economy affecting shipping services and trade with other economies. Contemporary research on shipping often focuses on issues such as national fleet development objectives or worldwide trends in shipping markets. In contrast, this project seeks to link national maritime policy reforms to changes in shipping services and trade.

The project will involve an integrated qualitative and quantitative assessment of international shipping services. The assessment will include a time series analysis of the impact on policy reform of shipping services and trade growth. It will also involve an analysis of regulations and policies that have been implemented to promote maritime industry development.

04. How, briefly, this project responds to the priorities set by APEC Leaders and Ministers, as evidenced by parts of the APEC Action Agenda including Action Program, work plan, vision statement, and policy statement that relate to this project. (*)

Leaders

The project responds to a number of priorities set out by APEC Leaders, particularly the TILF and Ecotech objectives. Specifically in November 1998 Leaders reaffirmed their resolve to strengthen, inter alia, trade and investment flows, economic infrastructure, and business and commercial links to provide for sustained growth into the 21st century. Leaders welcomed efforts to strengthen trade and investment flows in the region, including work on competition policy and regulatory reforms as well as rapid implementation of measures to enhance an environment conducive for trade and investment flows.

In addition, Leaders stressed the importance of harnessing and increasing the potential for SMEs to contribute to growth and development in the region.

Transportation Ministers

As this project will evaluate policies that promote efficient shipping services it responds directly to the Transportation Ministers direction to TPT-WG in 1997 to undertake work "aimed at promoting an efficient, safe and competitive operating environment for maritime transport ..".

05. For applications under the TILF Special Account: How briefly this project contributes to APEC Trade and Investment Liberalisation and Facilitation (e.g. relevance to specific parts of the Osaka Action Agenda).

This project responds to the general principles of Comprehensivenss, Transparency, Fexibility, Cooperation as described in the Osaka Action Agenda (OAA). The objectives and purpose of this project are embraced in the OAA under Part Two, Section B, ‘Economic And Technical Cooperation in Specific Areas’ section 6 entitled ‘Transportation Common Policy Concepts’ and in the associated Action Program for Transportation.

The specific Common Policy priorities appropriate to this project include:

• "facilitating the harmonization, coordination and transparency of transport policies, regulations, procedures and standards; and,

• promoting, on the basis of fair and equitable access to markets, a more competitive transportation operating environment and cooperating to address institutional constraints which affect the provision of transportation services".

LINKAGES

06. The kinds of institutions in member economies intended to benefit from the results of the project. Highlight the direct benefits to the institutions, the types of businesses in member economies which will benefit from the results of the project and what the direct benefits are.

The development of the proposed ‘Policy Framework’ that enhances access to and the viability of international shipping will provide benefits to:

• Governments and maritime policy administrators: As governments evaluate maritime policy reforms they could assess the impact of new proposals against the ‘Policy Framework’ and experiences reported by other governments;
• Cooperation among APEC partners: Greater recognition of the impact of policy changes to the supply of, and demand for, shipping services in APEC;
• Shipowners: Shipowners’ assessment of the opportunities and limitations affecting their entry into new trade areas will be broadened to take into account prevailing regulatory requirements and policy reforms;
• Port agencies and enterprises: A viable international shipping industry provides considerable flow on economic benefits and may improve the opportunities for employment in sectors such as stevedoring, port management, shipping lines agencies, customs brokerage, pilotage and towage industries; and
• Importers, exporters and the community: Benefits for these groups may accrue through better access to efficient and reliable international shipping services.

07. How the participation of the business/private sector and non- governmental institutions has been sought or will be sought. Illustrate how the business/private sector are involved in the planning and delivery of the project and whether any other APEC fora have been consulted (*)

As this project seeks to link the impact of national maritime policy on shipping services and trade it will essential for the consultant to liaise with shipping operators during the research and analysis components of the project. Shipping companies will also participate in the case studies which form a central part of the project.

Industry views were sought during the project proposal’s development.

08. How this project will add "APEC value" (as to the potential benefits of implementing projects) in the context of other work that might have been done elsewhere in the same field. (*)

As the project will yield information on the balance between fleet development policies and market access policies it will be useful to trade negotiators from APEC economies during the forthcoming maritime transport services negotiations in the WTO. Similarly, the project will add "APEC value" during maritime services discussions during OECD Maritime Transport Committee meetings. The project outcomes will also be useful in promoting the use of IAP’s as a means for communicating policies affecting the maritime sector.

09. An indication of how the project might contribute to related projects or activities in APEC or elsewhere.

This project builds directly on the outcomes of the ‘Transparency Exercise Questionnaire’ (TEQ) undertaken within the Maritime Initiative group of the TPT-WG. The Transparency Exercise reported on government and non-government measures in place in APEC economies that impinge on the operation of the maritime and auxiliary industries. Information from the TEQ will provide the basis for the qualitative assessment component of the project.

10. Describe the deliverables of the project and demonstrate how it will meet the needs of the targeted beneficiaries.

The project has two deliverables: a ‘Study of the Impact of Maritime Policy Reform’ and development of ‘Policy Framework’. The ‘Study of the Impact of Maritime Policy Reform’ will report on the research and analysis undertaken and the ‘Policy Framework’ will outline maritime policies which have been shown to facilitate efficient international shipping services.

The project deliverables will assist APEC maritime administrators who will be able to assess the potential impact of policy reforms on international shipping services and trade with greater confidence. Shipping companies may also apply the information revealed in the studies to assess the impact of regulatory changes and policy reforms to their operations.

11. A concise description of the project’s methodology.

Purpose

• To study the impact of maritime policy reforms on international shipping services among APEC economies
• To develop a framework of policies that facilitate the development of international shipping services.

Research and Analysis

A consultant will be employed to undertake a congruent study of changes in international shipping services and maritime policy reforms in the Asia Pacific for at least the last 10 years. A large part of the study will rely on existing information on APEC maritime policies and international shipping services gained from the TEQ and information gained during the extended maritime services negotiations at the end of the last WTO Uruguay Round.

Based on their research and analysis the consultant will attempt to determine when, and where, maritime policy reforms can be identified with associated improvements in the efficiency of international shipping services. The study will utilize information about international shipping such as:

Indicators of shipping service activity

• Analysis of the frequency and type of shipping services in the region.
• Analysis of the volume of trade in proportion to the size of relevant economies.
• Type of vessels trading.
• Vessels turn around time.
• Industry trends
• Capital investment by shipping lines – land based and/or blue water.

Maritime policy reforms

This information could be gained from the recent ‘Transparency Exercise Questionnaire’ undertaken in TPT-WG by Japan, information gained during the WTO negotiations on shipping, and reports by the OECD Maritime Transport Committee. It could include the following aspects of maritime policy:

• Port policies implemented by port authorities, regional or national governments.

• Review national policies to promote international shipping services or fleet development such as

• Specific policies affecting foreign conference arrangements
• Vessels registration incentives
• Establishment requirements for ships’ agents
• Tariff filing arrangements
• Bilateral agreements
• Preferential trading arrangements

Outcome

As described in paragraph 10, this project has two deliverables: the ‘Study of the Impact of Maritime Policy Reform’ and the development of a ‘Policy Framework’. The research and analysis components of the project will be reported in the ‘Study of the Impact of Maritime Policy Reform’. The Study will comprise an integrated qualitative and quantitative assessment of international shipping services and will include a time series analysis of the impact of policy reform on shipping services and trade growth. It will also involve an analysis of regulations and policies that have been implemented to promote maritime industry development.

Based on the outcomes of the Study the consultant will undertake case studies of economies whose maritime policy reforms have resulted in improving access to international shipping services. With the cooperation of APEC TPT-WG members, the consultant will encourage at least four (and possibly six) economies to participate in the case studies.

It will be important to ensure that participating TPT-WG members nominate a coordinator, or contact official, in their economy to liaise with the consultant and relevant shipping operators. The consultant will work with coordinators to analyse maritime policy instruments which have effectively improved access to international shipping services. The outcomes of the case studies will be reported in the ‘Policy Framework’. The ‘Policy Framework’ will describe maritime policies which have been shown to facilitate efficient international shipping services.

12. & 13. A concise description of the project by component, with its associated outputs clearly specified. A timetable for the accomplishment of each component.

14. The number of APEC member economies that will participate in this project. Please indicate the names of member economies participating in each component of the project as set out in (12). (*)

It would be appropriate for four to six economies to participate in the case studies proposed in this project.

15. An itemized budget for the project, including provision for any publication and dissemination of project results, is at enclosure 1.

16. A time table for the drawdown of APEC funding requested for the project, including details of any advance payment or instalment payment requested and justifications for such requests.

17. Details of any request for waiver or exception from the normal APEC financial rules with justifications. Nil

DISSEMINATION OF PROJECT OUTPUT

18. A plan for the publication and dissemination of the results of the project, including:

a. The nature of the target audience: Maritime policy administrators within APEC, Maritime policy divisions of UNCTAD, ESCAP, OECD Shipping lines.

b. The form and content: Two reports will be produced. The titles are not set but could be a ‘Study of the Impact of Maritime Policy Reform’ and development of ‘Policy Framework’.

c. Format:. The reports will be printed, available on the internet at the TPT-WG web-site and on disc as requested.

d. Number of copies for the publication: At least 50 hard copies of the report will published, providing one copy for each TPT-WG member.

e. Accessibility of results for the targeted audience: The results will be accessible from the internet and TPT-WG members will distribute copies to local shipping lines

f. A publicity plan: Following publication of the reports TPT-WG members will be encouraged to communicate the results of the projects as part of existing shipping, trade and policy conferences.

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ASSESSMENT OF PROJECT

17. How the project proponent will assess whether he has met the criteria for APEC projects and how he will measure the impact of the project on expected beneficiaries.

To be completed.

B. UNDERTAKING BY THE WORKING GROUP/COMMITTEE

The Transportation Working Group undertakes that, working closely with the APEC Secretariat, due care has been taken that:

1. The line items for the APEC-funded parts of the budget for this project are within SOM-approved guidelines.

2. The costs for line items for APEC-funded parts of the budget of this project are justifiable.

and, with regard to the dissemination of results from the project, due care will be taken that:

1. Comprehensive quality control and professional editing, including factual precision and thoroughness, to ensure that the publication or other dissemination media will be understood by and useful/beneficial to the target audience, will be undertaken before submission of the publication to the printer or the APEC Secretariat.

2. Any output will be consistent with APEC’s publication policy.

The project has been reviewed, approved and prioritized by the Transportation Working Group before it is submitted to the BAC for review.

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SIGNATURE

______________________________________
NAME OF LEAD SHEPHERD OR CHAIR (Please print)

_____________________________________
DATE AND PLACE

Enclosure 1

APEC TILF SPECIAL ACCOUNT :
ITEMIZED BUDGET FOR FINANCIAL YEAR 2000/2001

(Please tick ?.)
This project
o a. is a seminar, symposium or short-term training course
?b. is a survey or analysis and research project
o c. is neither a nor b above but involves the provision of equipment

This is an application for funding under the [   ] Operational Account
                                                          [4 ] TILF Special Account

This page was last updated on 12 March, 2008