An insight into the shipping industry by Amasgo Angelidi.
It is well known that Covid-19 affected most industries and brought changes in the way things are being done. Especially, in the field of shipping, it created many problems, since the industry plays an important role in the transport of essential goods and the restrictions on the entry to several countries have caused a lot of difficulties.
The outbreak of Covid-19 almost conquered with the long-expected 2020 Sulphur cap, which was predicted to cause short-term uncertainty in the industry. While some countries, in an attempt to reduce the impact on supply chains, chose to delay the implementation of the 2020 Sulphur cap, the level of uncertainty in the field of shipping increased and it is expected to continue for months to follow.
The effects of the pandemic on the shipping industry and the following legal and insurance consequences of the disruption have not yet been clearly defined. As BIMCO stated, “The industry shall be pragmatic and work together to find solutions. Not every answer will be found in the contract and parties should do their best to communicate openly about the issues they face and identify compromise solutions to find a way through these difficult times.”
The ability of shipping services to continue the transportation of food and medical supplies all over the continents, under the new and unprecedented circumstances, will play a key role in passing through this pandemic. Shipping companies should become more flexible and adaptable to the situation and focus on creating effective strategies and plans.
A response strategy plan requires planning for the worst-case scenario, with a prediction of how the crisis will evolve over time and what will be the biggest possible impact for the organisation. The evaluation of the worst-case scenario is an ongoing process as the crisis continues to grow and new insights and facts will become available.
Another sector of shipping, the cruise industry, has been significantly affected by the current Covid-19 outbreak. The cruise industry is the fastest growing sector of the travel industry and the recent global outbreak of the Coronavirus has created a high degree of concern amongst the public about the maintenance of health and safety on cruise ships. As many cruises are being cancelled and the options being offered are being reduced due to restrictions, the impact on this economy is causing many problems. Countries that are depended on the travel industry are expected to get hit the hardest.
Fortunately, the Shipping Deputy Ministry (DMS) in Cyprus, managed to react immediately and offered support and guidance in shipping companies. As the DMS stated on its website “continues to provide its high-quality services without any disruption, so that all ships registered under the Cyprus flag will continue to operate as usual”.
Moreover, on 9 April 2020 Circular 9/2020 was issued and aims to support the shipping companies and owners of Cyprus-flagged ships by reducing the impact of Covid-19 upon them. The circular contains instructions from DMS about the restrictive measures implemented by Cyprus Ports Authority and contractors/ operators/ licensed agents for port services and port installations during the pandemic.
Overall, at a time when the industry was preparing to take a greener approach, maritime stakeholders should now consider the wider impact of the pandemic, while maintaining the positive measures that have already been taken to preserve the environment. It is worth noting that according to experts, the industry may soon return to normal. This is because the virus is not spreading at the same speed under hot temperatures and this is an encouraging signal towards the restarting of operations in the industry.
Written by Amasgo Angelidi and edited by Stephanos Christodoulou.
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