Maritime Shipping at the Crossroads of Economic and Environmental Challenges

Date: 2011
Regions:
Le transport maritime à la croisée des enjeux économiques et environnementaux
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Article Index
Sea Cargo Types by Volume 1960-2008 (in billions…
PRIMARY GLOBAL CONTAINER SHIPPING FLOWS 2008
THE WORLD'S 50 LARGEST SEAPORTS' TRAFFIC VOLUMES…
MAJORITY OF OIL SPILLS OCCUR DURING LOADING AND…
World Shipping Fleet by Type of Flag 1970-2005
SOUTH KOREA'S PORT OF BUSAN IS ONE OF WORLD'S…
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The ocean cargo shipping industry owes its formidable economic efficiency to a unregulated and globalized system, provoking the question: how can it assume its environmental responsibilities? Seaports provide levers for action: the source of a growing number of regulations, they help manage fragile coastal areas that are increasingly coveted for various competing purposes.

Everyone buys products "Made in China." They spring from multinational companies' research centres, include components manufactured in several East Asian countries, and are often assembled in Shenzhen, China's special economic zone. Their financing, manufacture and sale involve many intermediaries in Hong Kong and potent marketing campaigns to consumers around the world. These products and their parts - packed in cartons, placed in containers, transported by trucks and ships - travel several thousands of nautical and land kilometres. They go from one factory to the next, from warehouses to retail shelves, in measured flows and quantities to meet production and distribution constraints. The odyssey of China's goods illustrates a core reality: our global economy has never before created such flows of materials and information. Ocean freight shipping forms the backbone of international trade, accounting for 80% to 90% of all volume: globalization could not occur without it. Increasing concern about sustainability in all forms - environmental, social and financial - requires a closer look at the profile of this industry.

Ocean Freight Shipping Provides Globalization's Backbone

Specialization, reliability and economies of scale. Shipbuilding innovations account for much of the historic growth of maritime trade. Large iron-hulled sailing ships - clippers - carried commodities across the entire world for the colonial system during the nineteenth century (Pétré-Grenouilleau 1997). After the clippers came the steamers and further technical innovations: Frédéric Sauvage's shortened-screw propeller, followed by Augustin-Normand's three-bladed one, with diesel replacing steam engines in 1914. The steamship reigned until the 1950s, ferrying millions across the ocean - third-class immigrants carried by their hopes to a new world, and a first-class high society of (already) global businesspeople and the rich (Fremont 1998).

Planes ended the ocean liner era. Marine vessels became progressively more specialized during the twentieth century: tanker ships to hold liquids, primarily oil, and dry-bulk cargo ships to carry mineral ores, coal and grain, reaching their peak in the post-war years (1945-1975). Most dry-bulk cargo ships provide tramp services: unlike scheduled cargo liners, tramp ships carry all kinds of cargo loads whenever and wherever users charter them.

Since the mid-1960s, container ships have transported other merchandise (Doovan and Bonney 2006; Levinson 2006), typically packed into 20- or 40-foot long containers (6 to 12 metres) and piled on ships that follow precise itineraries and the rhythms of the industry. Highly standardized in scale and volume, container ships carry an infinite variety of cargo: mass-market products, parts and commodities, fresh food in refrigerated containers, liquids and chemicals in tanks. Containerization allows shippers to make door-to-door deliveries from a factory to an inland destination warehouse by train, truck and/or barge without handling the merchandise: this "intermodal" transportation facilitates and accelerates trade (Frémont 2007).

Specialized port terminals for each kind of vessel also dramatically increase handling productivity. Tankers and bulk cargo ships remain in port for two or three days to unload, while a container ship takes only 10 or 20 hours to transfer thousands or tens of thousands of tonnes of cargo. The ships' accelerated turn-around time improves returns on capital and labor costs. Further specialization increases ships' cargo capacity. Oil tankers started the race toward gigantic ships in the post-war period, until the 1973 and 1979 oil shocks abruptly halted this development. These crises signaled the end of an economic growth model based on heavy industry: today's largest oil tankers and cargo ships do not exceed a 350,000-tonne capacity. Containerization also evolved to gigantic proportions, and the trend toward ultra-large container ships (ULCCs) has continued unchecked. At the end of the 1980s, shipowners surpassed the Panama Canal's lock-induced length limit of 32 metres (105 feet);

The Panama Canal, 48 miles of water connecting the Atlantic and Pacific Oceans, is undergoing a $5.25 billion expansion that is scheduled to be completed by Aug. 15, 2014, 100 years to the day after it opened. The expansion, though it still will not allow the canal to accommodate the largest of the ships, will enable products made in Asia to be sent directly to the East Coast of the United States instead of being unloaded on the West Coast and then sent east by train or truck (Severson 2010).

the largest ships currently have a capacity of more than 10,000 TEU,

TEU or "Twenty-feet Equivalent Units" is a measurement that quantifies the number of containers based on one twenty-foot container: one TEU equals one 20-foot container; one 40-foot container equals two TEUs.

i.e. more than 100,000 tonnes of cargo. Increased ship size leads to economies of scale that reduce per-unit shipping costs (Stopford 2009). Even when ground links are included, ocean cargo shipping's share of overall product cost is marginal - only a few pennies on the dollar.

Coordination along the transport chain ensures reliability - encompassing shipowners, freight forwarders who organize door-to-door shipping, longshoremen, customs officers and all the servicers who handle steering, hauling, docking, handling, provisioning. Computerization also provides essential services. The reliability and low cost of international transportation links make it possible for manufacturers and distributers to plan for global production and distribution systems.

Growth and crisis. International seaborne trade increased from only 550 million tonnes in 1950 to more than eight billion tonnes in 2008 (Fig. 1). In 1979, oil made up more than half of all shipments. Since then, containerized shipping has grown immensely, and represents more than 40% of all traffic. More than 500 million TEUs moved through the world's seaports in 2008, compared to 83 million in 1990, 35 million in 1980, and slightly more than 4 million in 1970: ocean cargo's average growth rate exceeded 10% per year.

In 2009, the economic crisis resulted in a 10% contraction of world trade (UNCTAD 2009), a decline unprecedented since the Second World War. The maritime shipping industry suffered immediate repercussions: rates fell through the floor; ships were pulled out of circulation; orders for new ship construction faltered and seaport traffic dropped by 10% to 20%. Maritime shipping's lag between supply and demand amplifies such crises, and as a result, mergers of shipowners are expected to occur. The economic crisis may also strongly affect ship construction, with Chinese shipyards pulling even further ahead of South Korean and Japanese ones. The latter will probably accelerate their ocean liner- and ferry-building activities, to the detriment of European shipyards that have specialized in such vessels.

Ocean Shipping Routes and China's Emergence

Ocean freight shipping follows specific routes. North America, Europe and East Asia account for more than 80% of oil imports: East Asia relies on the Persian Gulf for 80% of its supply, while North America and Europe draw less than 20% from the region. Most of Venezuela's oil is exported to North America, and North Africa's to Europe. West Africa's oil is split three ways, going to Europe, Asia and North America's eastern coast. A few key passages dominate oil routing: oil tankers carrying more than 280,000 deadweight tonnage (DWT) pass through the Straits of Ormuz, Malacca and Lombok, and smaller vessels use the Suez Canal and Straits of Gibraltar and Pas-de-Calais (Frémont 2008).

China's massive entry into shipping routes is the signal maritime event of the last twenty years. It increases East Asia's role in global trade, and reflects the emergence since the 1970s of the so-called "Asian Tigers" - the rising economies of Hong Kong, South Korea, Singapore and Taiwan, and of the more recent "Tiger Cub Economies" - Malaysia, Thailand, Philippines, Indonesia and China.

Asia continues its ascendency in bulk cargo shipments. It is the world' third largest importer: 27% of its imports (by value) are oil and mineral ores. In 2008, China imported 6% (by value) of all oil worldwide, compared to less than 3% in 2000 and 0.3% in 1990. It imported 53% (by volume) of worldwide iron ore in 2008 (UNCTAD 2009).

East Asia has been at the heart of the worldwide containerized system since the mid-1980s, structured by North-South route that runs from Japan to Singapore (Fig. 2). The two biggest trade routes in terms of total traffic, the trans-Pacific and the trans-Indian Ocean route to Europe, originate in East Asia. The intra-Asian market boasts the highest volumes in the world, reflecting the area's regional integration dynamic (Cullinane et al. 2007). The North Atlantic artery, dominant from the nineteenth century until the 1970s, completes the round-the-world freight circulation routes, with lesser traffic. North-South trade links are increasing in terms of absolute value of transported goods, but only account for 20% of all cargo traffic.

Of the world's 50 largest seaports, seven are located in North America, six in Europe and 26 in East Asia, including 11 in China (Fig. 3). The long distance between major seaport cities along North America's three coasts, i.e. the Atlantic, Pacific and Gulf of Mexico, underlies the relatively low density, in contrast to the Northern Europe seaport chain or that of the Japanese megalopolis. Singapore, Hong Kong, Busan (South Korea) and Kaohsiung (Taiwan) form the backbone of the Asian ocean freight-shipping route. China joins the axis with the Yangtze Delta ports of Shanghai and Ningbo, and the Pearl River Delta ports of Shenzhen and Guangzhou. However, China's northern seaports around the Bo Hai Gulf - Dalian, Qinhuangdao, Tianjin and Qingdao - remain apart from this network.

Outside of these large seaport and harbor areas, intermediary and smaller ports are found along the coast of developing countries or places specializing in commodities exports. In addition, transhipment

Transhipment involves unloading and transferring a container from one vessel to another at a container terminal. Generally, small container ships known as "feeders" serve smaller markets and sail to these "hubs" where their cargo is added to larger ships that sail the principal routes.

ports branch out along the container-traffic "highway," attracting freight from peripheral regions. Such ports are located on each side of the Panama Canal, in the Mediterranean along the Suez-Gibraltar route (Algeciras, Gioia Tauro, Piraeus, Damietta), and the Red Sea to Singapore route, i.e. Dubai, Colombo in Sri Lanka and Port Klang in Malaysia.

The Worldwide Fleet on Trial: True or False Accusations?

The accused. The ships involved in the most serious marine pollution accidents are engraved in memory: Torrey-Canon (1967), Amoco Cadiz (1978), Exxon Valdez (1989), Erika (1999), Levoli Sun (2002), Prestige (2002). These names evoke catastrophe: oil slicks, spoiled coastlines, long and complex trials where culpability, the value of damages and who should receive compensation have proven difficult to ascertain. These catastrophes throw sand in the well-oiled wheel of ocean shipping, revealing the sometimes-immoral workings of a system that supplies gasoline every day to an oblivious public in rich countries. These accidents often occur along the coasts of importing or exporting countries, in hard to navigate passages such as crowded straits or capes. Europe, on its Atlantic-English Channel coast, is especially vulnerable. Human error often leads to accidents, raising doubts about crews' capabilities; ship quality can also prove suspect, as in the Erika oil tanker spill.

However, the majority of accidental spills involve small quantities of less than seven tonnes, and occur during loading and unloading operations (Fig. 4). The number of spills has decreased since 2000 even while oil tanker traffic has increased, surpassing shipping levels achieved in the 1970s. The most serious marine pollution arises from intentional oil discharge, e.g. when deballasting, washing out tanks, draining fuel solids or water from holds. All ship types are guilty of these practices, following their owners' deliberate avoidance of portside waste treatment facilities in order to save money. Unlawful, hidden out of sight at night and in international waters, such gangster-like practices highlight the dark side of ocean cargo shipping - where anything goes, as long as it increases profits.

Ballast waters pose another huge problem: water transfers are estimated to reach three to 10 billion tonnes annually (IMO 2002). They help spread invasive species such as the zebra mussel, a small fresh-water mollusk from Europe introduced into the Great Lakes around 1986, following the deballasting of a Black Sea ship. Zebra mussels now inhabit most navigable waters in the eastern United States, and continue to spread westward, affecting the aquatic food chain and waterways' ecological balance, blocking pipelines and locks, attaching to boat hulls and hindering motors. They also infest swimming areas; combating them cost the United States nearly a billion dollars between 1989 and 2000.

Global warming concerns raise questions about ships' worldwide share of carbon dioxide emissions, estimated to be between 1% and 4% - comparable to the levels of a single country such as Germany. Even worse, freighters and tankers use heavy, unfiltered fuels, producing high emissions of nitrogen dioxide (NOx) and sulfur dioxide (SOx). These pollutants concentrate in large port cities, around islands, and in countries with long seaport and harbor coastlines near the largest shipping routes. Although ocean freight currently consumes the least fuel per tonne and per kilometre, its share could increase if ocean traffic keeps growing and other modes of transportation improve their fuel efficiency.

How can the world's merchant fleet be regulated? The seas and ocean are spaces of free circulation. For shipowners, evading the most constraining national laws is both a principle and a necessity, due to the fierce competition such lack of regulation permits. By using open registry, shipowners can freely choose which country's flag to sail under, exploiting tax advantages and recruiting crews that require lower outlay in employment benefits. Crewmembers from developing nations earn good salaries relative to their countries' standard of living, at the cost of unremitting work in often-difficult conditions, as they labor below decks to feed the engines of globalization.

The use of flag-of-convenience

The term flag of convenience describes the business practice of countries permitting the registration of ships owned by non-residents; usually occurs in a country whose tax on the profits of trading ships is low or whose requirements concerning manning or maintenance are not stringent. Sometimes referred to as a flag of necessity (ISL 2008: 419).

registries has steadily risen since the 1970s (Fig. 5). At that time, American shipowners used them to remain competitive with other countries' merchant ships, who then rushed to copy the practice. Two-thirds of the ships sailing under flags of convenience are actually controlled by developed countries, whose share of the world's fleet remains practically the same as it was in 1970.

Shipping fleets have come under increasingly complex and sophisticated management. Since the end of the 1970s, the big oil companies disposed of their tankers to avoid first-line liability in the event of spills. To minimize their risks, independent shipowners - mostly Greek or Scandinavian - based their companies in tax havens and run their ships through various geographically-scattered legal entities. Shipping services, such crew recruitment and maintenance, are systematically subcontracted to benefit from the lowest price on the market. Oil companies use short-term charters, renting a ship for a single trip, for example, or long-term charters, e.g. for a year. The ocean shipping market is completely deregulated and globalized, and astonishingly efficient.

Regulation of ocean shipping should a priori take place at the international level, via the International Maritime Organization (IMO). This entity proposes conventions aiming to ensure shipping security, minimizing environmental risks while preserving the industry's organizational freedom. Its two foundational conventions include SOLAS (International Convention for the Safety of Life at Sea) and MARPOL (International Convention for the Prevention of Pollution from Ships). These conventions have been updated several times; a convention on ballast water followed in 2004 (International Convention for the Control and Management of Ships' Ballast Water and Sediments), supplemented by a ship-recycling project (Ship Recycling Convention) and most recently by discussions about crew quality (International Convention on Standards of Training, Certification, and Watchkeeping (STCW) (see IMO 1974-2010). All of the conventions result from compromises among nations affected by the marine cargo industry and its pollution. Once adopted, the laws apply to everyone.

Questions remain as to when and how such laws will take effect. Their ratification requires thirty signatory states representing at least one-third of the world shipping fleet, suggesting very long timelines for implementation. This near-paralysis motivates states to create their own laws. After the Exxon Valdez spill, the United States enacted the Oil Pollution Act in 1990: it delineates the liability of various parties - shipowners, oil companies, classification societies

Classification societies are nongovernmental organizations that establish and apply technical standards in relation to the design, construction and survey of marine related facilities including ships and offshore structures. The vast majority of ships are built and surveyed to the standards laid down by classification societies (IACS 2010).

- in the event of an accident, and progressively requires double-hulled tankers. Europe is divided between liberal states that have their own flags (United Kingdom, Holland, Greece, Denmark, Malta, Cyprus) and more interventionist states. Repeated oil spills led to the First and Second Maritime Safety Packages (Erika I and Erika II) directives, adopted by the European Union in 2003 (EU 2002). These measures strengthen inspections of vessels and classification societies, gradually eliminate single-hulled tankers, implement a community-wide system for maritime traffic supervision, inspection and information, and create an indemnity fund for damage due to hydrocarbons in European waters. The European Maritime Security Agency, set up in 2003, implements the policy. The Third Maritime Safety Package (Erika III) will complete the directives in 2012: it increases shipowners' liability and asks each member state to ensure that ships flying their national flag conform to international standards.

In addition to the work done by states, large oil companies actively eliminate "garbage ships" via vetting services that decide which vessels to charter. The companies have high incentives for care since oil spills tarnish their brands for long periods. In developing countries, public opinion and legislative pressures lead to rectifying ships' quality problems and improving industry practices. The future may well see further technological progress that curbs ships' air pollution. Creating emissions permits could be a powerful motivating factor, even if their implementation on an international scale faces many obstacles. What is more certain is that increases in energy prices will motivate shipowners to reduce their ships' energy consumption.

But such measures remain a prerogative of the rich: the more distant the market, the cheaper and more hazardous the shipment, the less secure the areas served - the more likely that transactions will be the province of dubious companies, headed by corsairs and pirates of the twenty-first century. They stand to gain or lose fortunes by using garbage ships, disregarding crew dignity, and running the risk of environmental catastrophe. In 2006, the itinerary of the freighter Probo Koala, filled with toxic residues, ended in the Abidjan dump: its discharges killed seventeen people and poisoned thousands of others. The current economic crisis has led to the abandonment of many ships and crews in the Bosphorus Straits. These incidents illustrate the difficulty of regulating the worldwide fleet; laws collide with the world's inequalities, which in turn drive shipping's vitality as the handmaiden of globalization.

The Economic, Social and Environmental Challenges of Seaports

Inclusion in supply chains. A seaport's traffic depends largely on the wealth of its hinterlands and its location relative to the main ocean shipping routes (Vigarié 1979). In Europe, for example, Antwerp (Belgium) and Rotterdam (Holland) lead as principle seaports, serving its economic heart. They are major gateways to Europe's trade backbone, the so-called "Blue Banana" - a curved corridor of urbanization that runs from the Thames Basin in London through Germany's wider Rhine Valley and the Alps, terminating near Milan, Italy. The two seaports' success derives from their geographic location, and especially their ability to fit into international logistics chains (Wang et al. 2007).

While small compared to the ocean's immensity, large seaports extend over several thousand hectares with a succession of terminals and industrial buildings, forming vast seaport-industrial zone complexes. Despite the economic crisis, many have projects for new container terminals completed, underway or planned. These multi-million-Euro projects are usually publicly financed: inland freight distribution requires large-scale infrastructure.

A distinction should be made between bulk cargos and containers. Bulk cargo is mainly processed in the seaport-industrial zones, to avoid adding ground shipment costs to negligible sea freight expenses. It is the reason many heavy industries have moved to the coasts in developed countries during the postwar period. Such bulk traffic is captive for the most part, ensuring regular earnings for the ports. In contrast, containerized traffic is less reliable, whether originating in or going to large metropolitan areas (Hayuth 1981). Because of its flexibility, trucking plays a larger part in carrying goods inland compared to other modes of ground shipping, requiring increasingly dense highway systems. However, freight volumes have increased to the point where shipping by waterways or rail makes logistical sense. Large ports take care to avoid ground congestion, to ensure that the system continues to function. The Rhine River in Germany carries two million containers per year. In North American, the east-west railroad line through Chicago carries loads of containers on double-stack trains that are several kilometres long. The Ports of Rotterdam in Holland and Long Beach near Los Angeles have dedicated freight rail lines: Rotterdam's Betuwe Line runs directly to the German border, and Long Beach's rail freight moves along the Alameda Corridor to inland sorting centers. These cases demonstrate the high investments made in infrastructure. Inland sorting, warehousing and distribution centres join with logistics platforms; such sites are sometimes called Inland Ports or intermodal hubs. Thus railways (and waterways) create true port corridors, reducing congestion and enlarging inland port capabilities: they also reduce inland costs (Notteboom et al. 2009).

Infrastructure is useful only when it fits market needs. Shipowners, freight handlers and forwarders must organize and run door-to-door transport chains, developing global maritime networks, terminals and agencies to meet shippers' overall demands. These networks concentrate around the world's three main economic points - East Asia, North America and Europe - and deploy in a looser fashion in the rest of the world. On land, railroad companies extend their networks across North America. The European Commission liberalized rail freight to create similarly-sized operators in Europe (Debrie and Gouvernal 2006). Fierce competition in the trucking industry, fueled by industry decentralization and legislative differences between European countries, furnishes another variable to ensure the system's efficiency. Transport companies link networks to increase freight-carrying modes and destinations. They act individually, doing as much as they can afford alone, but also link with others, expanding via complex relationships of competition and coordination. The container - the intermodal box - has opened the door to vertically integrated transport chains.

As a result, the "landlord port," serving its varied tenants, becomes the dominant model. Port authorities, who own the port's major facilities, shipping access channels, basins and quays, concentrate on maintaining security, order and rules, but do not participate in running the shipping networks. Freight handling companies lease port terminals for long periods of time. International terminal freight services companies, i.e. forwarders, consolidators and Customs brokers, etc., oversee the organization and coordination of land and sea services; their strategies directly determine the future of large seaports. Ports are pawns, an expendable link among others in complex and, in some ways, interchangeable transport chains (Slack 1993). Ports constantly adapt to supply chain needs, reinforcing the "landlord port" model and the trend toward "always providing more" in developing seaport and inland infrastructure. The risk is that a port may become dependent on a dominant shipping line or terminal services company: public policy-makers, acting through port authorities, must ensure competition and referee issues as needed, e.g. when tenant companies' special interests differ from those of ports.

Meeting social and environmental demands. Seaports are situated in complex coastal territories, where urban and industrial activities mix with shipping activities. They usually adjoin vast, multi-million-dollar urban areas. They must contend with fishing, tourism and rich yet fragile ecologies, on sites near wetlands, estuaries and deltas. Other users of these territories increasingly contest port activities, questioning their economic and social utility (Frémont 2009). The industrial-port zones no longer provide as many jobs as in the past, having suffered industry's restructurings since the 1970s. Containerization furnishes a source of economic growth if logistics or international trade activities settle in a port, or nearby. Otherwise, the port is simply a technical passageway, perceived as a money-making machine for international shippers, without providing any real benefit to local residents.

Even worse, seaports harbor many pollution sources and dangers with their concentrated petro-chemical installations, usually containing hazardous substances with the potential to contaminate vast areas (see e.g. the 1976 Seveso incident

The "Seveso" accident occurred in 1976 in Seveso, Italy, at a chemical plant manufacturing pesticides and herbicides - substances similar to those carried through and stocked at seaports. A dense vapour cloud was released, containing what is commonly known as dioxin, a poisonous carcinogen. More than 600 people had to be evacuated from their homes and as many as 2000 were treated for dioxin poisoning (Wikipedia 2010).

). Such concerns have increased pressure from many non-profit environmental groups and, in turn, from public institutions, leading to stronger protections for coastlines. In Europe, for example, all large ports come under the Natura 2000 network, a European Union policy to protect critical natural habitats and species: the Port of Le Havre on the Seine River, Antwerp on the Escaut River, Rotterdam at the mouth of the Meuse and the Rhine, Bremerhaven on the Weser, Hamburg on the Elbe, and Fos near the Carmargue wetlands.

A contradiction has emerged between development imperatives: greater worldwide seaport growth on the one hand, founded on competition between transport chains, and increasing economic, social and environmental constraints on the other. Every port expansion project faces concerns or, most often, strong opposition that crystallizes around competition for space in the port, at the port-city interface, and inland. Confronted with a lack of space, port authorities design projects ever further from city centers whenever possible. For example, the new South Korean Port of Busan is situated ten kilometres (six miles) west of the current port, completely outside of the city (Fig. 6); and Rotterdam's Maasvlakte II project reclaims land from the sea to increase the port's capacity. However, seaports can no longer avoid dialogue with surrounding stakeholders: new port projects now face public scrutiny and negotiation, breaking with the post-war period when simply pouring concrete sufficed to increase traffic. Port development projects must go through planning reviews and assessments that ensure that they also benefit local residents rather than just a single interest. These reviews last at least ten years in democratic countries, a long process. Even China - where short-term economic interests prevail - cannot continue to open gigantic port terminals in record time without soliciting local acceptance. This is the critical urban planning role for port authorities facing dual objectives: integrating the port into transport chains on the one hand and into its local context on the other, through a balance of economic, social and environmental development. Port authorities, having long considered only traffic volumes, must undergo a cultural revolution if they are to embrace their new mission.

Conclusion

Maritime shipping is the backbone of globalization. Its efficiency allows it to support growth in international trade. The latter depends on the health of the global economy. Three principal economic poles - North America, Europe, and East Asia - will structure worldwide ocean cargo flows, even as new growth areas emerge in South America, Africa and Southeast Asia. Their emergence will lead to more complex shipping networks in the future, and a stronger role for transhipment ports.

Could other forces break the logic of the maritime shipping system, such as a significant rise in energy costs? Shipping fuel costs are marginal on a merchandise unit cost basis, due to large economies of scale. However, higher fuel costs, combined with an international tax on ships' emissions and more draconian legislation to reduce in-port air pollution, would motivate shipowners to reduce their vessels' fuel consumption. That combination could also drive innovation in shipbuilding yards, which should focus on creating the "green" ship of the future. In addition, improving occupational regulations for crewmembers would certainly reduce accidents at sea. But even if the political will existed, what international organization - governmental or not - could regulate an international activity that has long benefitted from extreme organizational freedom? One outcome is certain: at the local level, in the ports of rich countries, ocean shipping will confront increasing regulation, as states strive to manage fragile coastal spaces - increasingly coveted, increasingly used for contradictory and diverse purposes.

Sea Cargo Types by Volume 1960-2008 (in billions of tonnes)

Sources: Compiled by the author from UN, ISL, CCAF, UNCTAD data
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PRIMARY GLOBAL CONTAINER SHIPPING FLOWS 2008

Source: Frémont (2009a)
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THE WORLD'S 50 LARGEST SEAPORTS' TRAFFIC VOLUMES 2007

Source: Frémont (2009a)
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MAJORITY OF OIL SPILLS OCCUR DURING LOADING AND UNLOADING

Source: ITOPF (2010)
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World Shipping Fleet by Type of Flag 1970-2005

Source: UNCTAD (2005)
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SOUTH KOREA'S PORT OF BUSAN IS ONE OF WORLD'S LARGEST

Source: Frémont and Ducruet (2004)
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