[ “Asia Shipowners Forum Should Continue to Act for ]

the Best Interest of the Members”

Chairman of the Korea Shipowers’ Association(KSA), Cho Soo-ho comment
ed at the official opening of the day-long meeting of the Six Asian S
hipowners Forum(ASF) in Singapore on May 13 this year. His speeches a
s below.
“I must confess that this last two-years of my term as chairman of Tr
anspacific Stabilization Agreement have been the most difficult ones f
or everybody involved in the global liner industry with tougher compet
ition and below desirable freight levels.
Today I would like to make a few general comments on the changing envi
ronment and how to cope with the changes.
Koera has become a member country of Organization for Economic Coopera
tion and Development(OECD) at the end of last year, and participated i
n the Maritime Transport Committee(MTC) in April this year. A recent
MTC meeting adopted a memorandum of understanding upon compatibility o
f competition policy in container and multimodal transportation servic
es.
Synoposis of this MOU were;1)maritime policies and regulations of all
countries should be transparent, predictable and clear, 2)close monito
ring should be made on anti-trust immunity of shipping industry in eac
h country, 3)competition policy of each country should be coordinated
and aligned on a global scale for the benefit of all participants.”
“This MOU can be potentially applicable toward the New Independent St
ates/Central and Eastern European Countries (NIS/CEECs) and Dynamic No
n-Member Economies(DNMEs) in addition to the existing member countries
of OECD. In such a case, it will have a big impact on global liner s
hipping industry with possibilities of enactment as an international t
reaty.
The Ocean Shipping Reform Act, currently discussed in the U.S. Senate,
attracts a great deal of our interest. Especially, carriers have to c
losely watch those clauses concerning promotion of service contracts,
elemination of filing system and broader definition of so-called ‘con
trolled carrier’, which might have huge impact on shipping industry b
y bringing in more severe competitions and/or unfair penalties.
Another area which merits our attention is the multi-modal transportat
ion. Introduction of Intermodal Transportation Board in the U.S. Refo
rm Act and OECD’s efforts to promote multimodal industry indicate tha
t, in the foreseeable future, the liner shipping industry might be mer
ged into one big category of ‘multimadal transportation’.”
“Global shipping industry has already seen the trend of ‘becoming bi
g’ through alliances an mergers. Synergy’s from these alliances and
mergers are obvious, but how far this phenomena of mergers and allian
ces could ultimately go is a matter of our keen attention.
EU has also announced the New Maritime Strategy in March 1996. It stip
uates higher standards of competition through international treaties,
tries to eliminate existing trade barriers, supports various governmen
tal subsidies, and requires penalties to operators as well as owners o
f sub-standard vessels.
They are apparently protecting EU’s own interests, and at the same ti
me regulating and interfering other countries’ policy of competition
with their own standards and criteria.
Summarizing all of these complicated situations, the U.S. takes advant
age of its own market size, the largest in the world, while EU collect
ively acts as one big entity in order to protect own economies and inf
luences the global maritime rules in their favor.
Without unanimous voice and single entity to protect own interests, As
ian countries cannot compete against U.S. and European nations.
I believe Asia Shipowners Forum should continue to act for the best in
terest of its member, and furthermore must be strengthened in its infl
uence and functions to become an effective alternative against EU and
U.S.”