By Clinton Williams

GUYANA’S trade transaction costs and as a consequence our competitive advantage are inextricably linked to an effective and efficient Maritime Transportation Sector. Increased industrialization and trade liberalisation has fuelled the acceleration of free trade. This in turn has resulted in technological advances with respect to Maritime Transportation buoyed by increases in world population, thereby increasing the demand for food, raw materials and finished products by both developed and emerging economies.The major international shipping lines have been responding to the increasing freight demand by constructing larger vessels, thereby realizing competitive advantages in terms of cost efficiency and transit times. This tendency is likely to continue and possibly escalate with the completion of a number of mega projects. These developmental needs have resulted in major shifts in the global maritime transportation corridors evidenced by the following viz: the expansion of the Panama Canal which has now been recently opened to the public; the construction of the Interoceanic Grand Canal Nicaragua project; the proposed Guatemala’s Interocean Corridor; transformation of Ports from transshipment hub ports to Gateway Ports, facilitating last minute logistics; the recently completed Egyptian Suez Canal Facility and the corresponding upgrading of the US East Coast Facilities; and finally the planned upgrade of the US Land Bridge between the US West and East Coast.

These developments are already challenging Caribbean Ports to undergo “a paradigm shift” with respect to cargo movement due to the following viz: For 90% of the Containerised Cargo imported into the Region, the containers are returned empty. This could present a challenge, as well as an opportunity; the global economic meltdown and associated financial crisis of 2008 has forced Regional Ports to reinvent themselves away from simply receiving, storing and delivery of cargo to assuming the role as an integral part of the global supply chain and finally the wider Caribbean, endowed with an opportunity of serving 800 million people covering North, Central and South America and all the Islands within the Caribbean Seas.
Some of those currently being modernised to accommodate safe berthing and efficient discharge of the newer post Panamax Mega Ships, as well as accompanying logistical facilities viz: Kingston (Jamaica); Mariel (Cuba); Causedo (Dominican Republic); Point Lisas/Port of Spain (Trinidad); Freeport (Bahamas); Cartegena (Colombia) and Manzanillo (Panama). Guyana’s cargo demand for the foreseeable future is likely to be influenced by the following:

– Substantial increases in exports of traditional products viz: sugar, rice, forestry, bauxite and other minerals and added value items derived from these. There is also likely to be corresponding increases in fertilizer and other imports to support the production and exports envisaged.

-Increased demand for both imports and exports of raw materials and finished products from Northern States of Brazil (Para Roraima and Amazonia) due to exhorbitant freight costs and transit times associated with the Amazon River Corridor.

-Increased demand for transportation of commodities derived from bauxite, aggregates, manganese, etc.

Faced with the dual challenge associated with increased cargo demands and restrictive vessel specifications inclusive of draft and handling gears, the Guyana Maritime Sector would be continuously challenged to provide the following:

-Significant expansion/implementation of effective and efficient management and operation of the Demerara and Berbice River Harbours and Offloading Berth, this must include the establishment of transshipment hubs; capital and maintenance dredging; tugboats; navigational aids, firefighting equipment; mooring buoys, etc.

Such major infrastructural machinery and equipment interventions are best addressed via public/private partnerships. It therefore means that Guyana must also as a necessity and priority implement a similar model that is best suited for our particular circumstances.

-Another major intervention is the need for the establishment and/or refurbishment of local shipyards. Such facilities become a necessity, not only to provide shipbuilding and repair services to ferries, cargo boats, tugs and barges, but also critical product support services for emerging sectors such as oil and gas.

-The other intervention is the strengthening of our regulatory institutions such as MARAD, to ensure that there is adequate safety and security within the sector, inclusive of enforcement of mechanisms that would allow for compliance to mandatory international standards and regulations such as the IMO’s, ISPS Code and other emerging environmental management systems.

-The reduction of trade transaction costs and time is an absolute necessity. Quite apart and distinct from the efficient processing of import and export documentation, the need for continuous introduction of ICT, starting with SWAP within the sector would ensure that Guyana is not only compliant but competitive with other regional ports with regards to acceptable standards for cargo processing and clearance.

Finally it is indeed an anomaly that in Guyana (land of many waters) there exists no dedicated skills development training facility specifically geared to the needs of the maritime industry. Such a facility must form the basis of any modern maritime services and logistics sector in Guyana. Business support organizations such as the Shipping Association of Guyana (SAG) must of necessity become more proactive in leading the way in taking the sector to the next level.