Hellenic Chamber of Shipping board member Yannis Triphyllis
initiated a debate between insurers that covered virtually all of the major
challenges of the maritime market in the modern age.
In his welcome speech to the Marine Insurance Greece conference
in Athens on May 06, Triphyllis claimed that, “Invasion of the Donbas was the starting gun for the
unravelling of the rules-based market.”
Key to the discussion was a presentation by COO of the
American Club, Daniel Tadros, who laid out the US vision of a new
world order, which has the US
at the center of the new global economic regime.
Tadros launched into his treatise with a quote from the
second world war Admiral Yamamoto, of Japan, speaking after the attack on
Pearl Harbour, “I fear
that all we have done is to awaken a sleeping giant and fill him with a
terrible resolve.”
“Now, fast forward to the last four or five years,” Tadros
told the Maritime Insurance Greece audience, “The geopolitical competition
with China, both commercially and as a matter of national security, has
woken up the United States and has filled not just politicians, both Democrats
and Republicans, but also the government, the military, everyone, with a resolve to rebuild the US
Merchant Marine.”
Historically
the US had been a world leader in shipping, owning 63% of the world’s tonnage,
today that was down to less than 1%, the cutting of government
subsidies, high labour costs all contributed to the rise of Japanese and South
Korean prominence in shipbuilding.
In the last 15 years, China has surged ahead, not just in
shipbuilding, which Tadros focused on, but in a number of key industries,
including electric vehicles, green energy and through investments across the
globe through the Belt and Road.
“The geopolitical competition and national security have
created what many have called assertive US maritime trade policies,” said
Tadros. The assertive policy can be seen in the tariff regime and other
policies that are aimed at levelling US costs with their international
competitors.
“In the
Western Hemisphere, the United States is looking at combating China's
influence, migration, combating cartels, expanding partnerships, and
strengthening supply chains, including looking at the Venezuela region.”
The US is combating Chinese influence in Africa, Europe and
the Middle East, and Washington is, “working furiously” to reach a peace deal
in Ukraine, Tadros said.
According to the assertive America doctrine, a key issue is
to avoid conflict between China and Taiwan, and to avoid conflict in the Middle
East the US has taken action to remove its main destabilizing forces the
Palestinians and the Iranians.
An effect of the assertive America policy was highlighted by
George Karkas, MD of Gard Greece, “Developments in the Strait of Hormuz have
been quite extraordinary. I actually heard from Mr. Rubio that 10 seafarers
died,” in what Karkas said is “one of the most significant disruptions to
global trade and energy markets in decades.”
The
potential consequences of the disruptions could affect food supplies, energy,
and the basic necessities of life for millions of people around the world.
Since April, there have been some 20,000 seafarers stranded on between 2,000
and 3,000 ships imprisoned in the Arabian Gulf.
Shipping, as Karkas points out, is a major global success
story, “Over time, we have built the framework of rules, standards, practices
that work together and have made shipping safer, more efficient, and more
accountable. Today, shipping is one of the most internationally governed
industries in the world, and this matters. We see fewer lives lost at sea,
fewer major casualties, and fewer pollution incidents than at any point in any
modern history.”
This framework did not evolve through chance, it happened
because it was “rooted” in the work of the United Nations and the IMO, he said.
Now we are “entering an
age of extremes,” according to Karkas, shifting from a bipolar to a multipolar
world “marked by conflict, shifting alliances and fragmentation”.
Karkas showed that the maritime insurance industry has
reduced the number of claims — shipping has become a safer industry overall —
but that claims over a five-year average are now three times bigger, with the
strongest increase in the last 10 years.
“So, we have fewer claims, but when things go wrong, they
seem to go very wrong and become very costly. In short, we see far more extreme
claims. Why is this happening? The reasons are probably many and complex, but part of the picture is
no doubt politics and geopolitics,” said Karkas.
Karkas spoke about the criminalization of crew where nation
states are more interested in extracting money than they are in justice for the
accused. “If claims and verdicts, become more detached from reality and from
the loss actually suffered, they end up undermining trust in the system,"
he said.
The system is under increasing pressure from risks,
including climate change, extreme weather, the shadow fleet, which continues to
be a systematic challenge for insurers, and not least the increase of more
extreme claims.
Although not directly said by Karkas in his presentation, the global ramifications of the
assertive America doctrine are a decay in a system of trust, which ultimately
undermines the system as a whole.
Courtesy: Seatrade Maritime News
