World Bank -Trade and COVID-19 (Coronavirus)

Photo: Martin Sanchez, Unsplash

Maintaining trade flows during the COVID-19 pandemic will be crucial in providing access to essential food and medical items and in limiting negative impacts on jobs and poverty.

The speed and scale of the crisis are unprecedented. But governments can ameliorate the impact. The following documents, hyperlinked to this page provide initial guidance for policymakers on best practices to mitigate pandemic-related trade risks, support trade facilitation and logistics, and implement trade policy in a time of crisis.

Managing Risk and Facilitating Trade in the COVID-19 Pandemic

Maintaining trade flows as much as possible during the COVID-19 pandemic will be crucial in providing access to essential food and medical items and in limiting negative impacts on jobs and poverty.

Some countries are closing border crossings and implementing protectionist measures such as restricting exports of critical medical supplies. Although these measures may in the short-term provide some immediate reduction in the spread of the disease, in the medium term they may undermine health protection, as countries lose access to essential products to fight the pandemic. Instead, governments should refrain from introducing new barriers to trade and consider removing import tariffs and other taxes at the border on critical medical equipment and products, including food, to support the health response.

Trade facilitation measures can contribute to the response to the crisis by expediting the movement, release, and clearance of goods, including goods in transit. The World Bank Group provides guidance and technical assistance to developing and least developed countries to implement best practices to facilitate the free flow of goods.

Download the Guideline here!

Do’s and Don’ts of Trade Policy in Response to COVID-19

Despite the initial inclination of policy makers to close borders, maintaining trade flows during the COVID-19 pandemic will be crucial. Trade in both goods and services will play a key role in overcoming the pandemic and limiting its impact in the following ways:

  • by providing access to essential medical goods (including material inputs for their production) and services to help contain the pandemic and treat those affected,
  • ensuring access to food throughout the world,
  • providing farmers with necessary inputs (seeds, fertilizers, pesticides, equipment, veterinary products)for the next harvest,
  • by supporting jobs and maintaining economic activity in the face of a global recession. Substantialdisruption to regional and global value chains will reduce employment and increase poverty.Trade policies will therefore be an essential instrument in the management of the crisis.

Trade policy reforms, such as tariff reductions, can contribute:

  • to reducing the cost and improving the availability of COVID-19 goods and services,
  • to reducing tax and administrative burdens on importers and exporters,
  • to reducing the cost of food and other products heavily consumed by the poor and contributing to themacro-economic measures introduced to limit the negative economic and social impact of the COVID-19 related downturn,
  • to supporting the eventual economic recovery and building resilience to future crises.

Governments with industries producing COVID-19 medical goods or food staples can further contribute by committing to refrain from limiting exports through bans or taxes. If export restrictions must be used, then they should be targeted, proportionate, transparent, and temporary.Measures to streamline trade procedures and facilitate trade at borders can contribute to the response to the crisis by expediting the movement, release, and clearance of goods, including goods in transit, and enabling exchange of services.

Reforms can be designed to reduce the need for close contact between traders, transporters and border officials so as to protect stakeholders and limit the spread of the virus, while maintaining essential assessments to ensure revenue, health and security. Interventions to sustain and enhance the efficiency of logistics operations may also be critical in avoiding substantial disruption to distribution networks and hence to regional and global value chains.

Download the Guideline here!

Trade in Critical COVID-19 Products

The covid-19 pandemic is increasingly a concern for developing countries. Using a new database on trade in covid-19 relevant products, this paper looks at the role of trade policy to address the looming health crisis in developing countries with highest numbers of recorded cases. It shows that export restrictions by leading producers could cause significant disruption in supplies and contribute to price increases. Tariffs and other restrictions to imports further impair the flow of critical products to developing countries. 

Download the Guideline here!

Also view the Blog post – Viral protectionism in the time of coronavirus

Source: World Bank, 1April, 2020

Guide: Goods and Conveyance Reporting in South Africa

A companion guide in support of increased compliance in the reporting of goods and conveyances (RCG) to Customs, South Africa.

Necessary information for – Air, Sea and Road carriers, vessel’s agents, NVOCCs, freight forwarders, Air and Sea terminal operators, container depot operators, transit shed operators and de-grouping depots. Also, all private software service providers to the trade.

The guide offers easy navigation through –

  • registration and electronic trading with SARS Customs
  • the various electronic messages mandated by law, covering import and export movements, across all modes of permissible international transportation
  • message types for each transaction type
  • scenarios to facilitate easier understanding across operators in the supply chain on how the various electronic reports are sequenced, ensuring that Customs formulates a comprehensive end-2-end view of a international trade transaction
  • reference webpages, official notifications, Customs rules and other pertinent information concerning cargo reporting.

All information is hyperlinked to SARS documentation, found on the official SARS website www.sars.gov.za

You may download the Guide below (File size: 3MB)

Books to make you better understand the Shipping Industry

Luc Castera founder of Octopi, a tech company in the logistics industry, has recommended a series books to broaden culture and learning about the shipping industry. Ninety percent of everything around you was carried over on a shipping container before it reached you. It’s the industry that puts food in your plate, clothes on your back and enables the success of e-commerce globally. Yet, very few companies are trying to solve the hard problems facing this industry, says Octopi co-founder Luc Castera. If you are new to this industry, or if you have been working it in for 20 years and believe that learning should be constant, Luc highly recommends the following books.

1. The Docks by Bill Sharpsteen

Focusing on the Port of Los Angeles, The Docks delves into the unseen world of this highly successful enterprise. Author Bill Sharpsteen paints a picture of the port’s origins, zeroing in on the people that helped contribute to its economic prosperity. While Sharpsteen emphasizes the Port’s success, he also talks about its vulnerability with security and labor, while including personal stories from industry insiders. One perspective he includes is that of one of the first women longshoremen. The Docks demonstrates the energy behind this incredible port through dramatic photographs and personal perspectives.

2. The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger by Marc Levinson

The Box tells the story of the container and its beginnings. What started as a simple box, changed the future of the shipping and transportation industries collectively. The container idea was slow on the uptake and economist Mark Levinson tells the story of how, after a decade of struggle, it came to fruition and changed the transport industry for good. Levinson includes key notes about how the inclusion of the “box” brought some ports back to life, whereas others suffered with its implementation. Thanks to this extraordinary box, costs were cut in the transport sector and the global economy is able to thrive, today.

3. Port Management and Operations by Maria G. Burns

Port Management and Operations has created a manual filled with insights and strategies into the world of shipping. Through examination of port management practices on a global level and deconstructing them on commercial and technological levels, this manual provides readers with a new set of skills and perspective. Port Management and Operations touches on 4 themes: “Port Strategy and Structure, Legal and Regulatory Framework, Input: Factors of Production, and Output and Economic Framework.” This book also identifies strategies and provides insight into the future of shipping.

4. Port Business by Jurgen Sorgenfrei

For veterans or those just starting out in the shipping industry, this book breaks down the meaning of ports and explains the role they play in the global supply chain. With globalization, exporting has increased exponentially, and the shipping market is changing. Port Business breaks down and analyzes the struggles for small to mega-sized ports, providing insight into the industry’s future.

5. The Travels of a T-Shirt in the Global Economy by Pietra Rivoli

Through the perspective of a T-shirt, this narrative has a lot to say about globalization and international business. Following a T-shirt from Texas to Africa, author Pietra Rivoli reveals political, cultural, economic, and moral issues associated with international business. The reader is challenged to view trade through an unconventional perspective while evaluating the complex layers of business crossing borders.

6.The Shipping Man by Matthew McCleery

Matthew McCleery tells the story of a hedge fund manager turned shipping man. After deciding to buy a ship on a whim, Robert Fairchild enters the complex world of shipping. A stark contrast to his New York life, Fairchild embarks on a journey where he learns about everything from Somali pirates to the wealthy folk of Wall Street. Though he ends up losing his hedge fund, he gains the title of shipping man along with the knowledge associated with it.

7. Ninety Percent of Everything: Inside Shipping, the Invisible Industry That Puts Clothes on Your Back, Gas in Your Car, and Food on Your Plate by Rose George

Ninety Percent of Everything unveils the invisible world of shipping to the commoner’s eye. Author Rose George divulges the secrets of the “invisible industry” through her incredible adventure sailing from southern England to Singapore. Five weeks aboard The Maersk Kendal and countless miles later, George lets readers into the shipping industry from the perspective of someone with little experience. Her objective in writing this tell-all piece is to shed light on the otherwise closed-door industry and to inform consumers about the shipping life and all that entails.

Published by Maritime Executive, Luc Castera, August 23, 2017

New Digital Currency “TEU” to Transform Container Shipping Business

TEU Token

The creators of a new industry-specific digital currency that shippers can use to book ocean shipments say so-called “cryptocurrency” could help reduce carrier overbooking and shipper no-shows, which cost the industry some $23 billion annually.

The Hong Kong-based 300 Cubits recently introduced the TEU, not the container unit but rather a digital dollar that replaces traditional currencies as the deposit for shipment bookings, providing greater visibility to the booking process and allowing users to penalize bad behaviour. Whereas other tech startups have introduced digital management platforms to achieve the same goals, 300Cubits’ founders say they’re offering something different: not a place for transaction, but a means of transaction.

The company introduced the new TEU crypto currency to the market, putting some up for sale and giving others away to container lines and shippers “who actively promote the tokens for early adoption.” The TEU tokens are blockchain-based, which means they are tethered to a decentralized, distributed digital ledger used to record transactions across many computers so that the record cannot be altered retroactively.

Blockchain is a largely back-end technology, which means there’s very little change for the user, both shipper and carrier, according to Johnson Leung, a longtime shipping finance analyst formerly with Jefferies who founded 300Cubits with his partner Jonathan Lee.

“The biggest change is the acceptance of TEU tokens as a booking deposit, which is a more commercial decision than a technical call,” Leung told, “We do not plan on a substantial change in terms of user interface experience other than having one more option for the user to choose whether to use TEU tokens and the amount to put it before the shipper clicks on the book button.”

The tokens were named TEU to honor, in a way, the classical unit of measurement for container shipping, said Leung.

“TEU is a kind of a classical unit for container shipping that is getting less and less used,” Leung said. “We just think that the people in the industry would appreciate the name as TEU when naming something that could be the money for the industry.”

In an era marked by the buzzword “disruption,” Leung was clear that TEU tokens are not disrupting any existing system or process in the container shipping industry. TEU tokens are like an industry-specific bitcoin, another blockchain-based cryptocurrency. Put simply, Leung said, “We play part of what the dollar does today in container shipping.”

According to a white paper prepared by the company, once TEU tokens are used to book shipment their value could be lost if a customer does not turn up with cargo or a carrier does not load cargo according to a confirmed booking.

Trust, or lack thereof, is the biggest pain point in the container shipping industry, according to 300 Cubits.

“Unlike ticket booking in airlines, customers in container shipping do not bear any consequence for not showing up for bookings. Industry people complain the lack of trust between liners and customers,” the company said in a statement. The TEU token can change that.

While it is aimed at tackling overbookings and no-shows and providing greater visibility into the container shipping industry, 300Cubits should not be confused with other tech firms attempting to accomplish the same feat through different avenues. Leung’s company only provides the means of transaction. It does not provide the actual space for where carriers and shippers can transact, like the New York Shipping Exchange, an online portal through which carrier cargo space can be booked and which also monitors whether the booking is fulfilled by shipper and carrier.

According to Leung, the container shipping industry is a $150 billion industry that has been in “constant distress” since the economic crisis of 2008. Subtle technological innovations, like digital currencies and digital marketplaces to use them, are going to be the means to ease that volatility.

Frequently Asked Questions regarding TEU – 300cubits.tech

300Cubits White Paper – 300cubits.tech

Source: www.dailyshippingtimes.com, 3 August 2017.

New CTU Code – IMO Approves Container Weight Verification Requirement

containerThe Maritime Safety Committee (MSC) of the IMO has approved changes to the Safety of Life at Sea (SOLAS) convention that will require verification of container weights as a condition for loading packed export containers aboard ships.

Misdeclared container weights have been a long-standing problem for the transportation industry and for governments as they present safety hazards for ships, their crews, and other cargo on board, workers in the port facilities handling containers, and on roads. Misdeclaration of container weights also gives rise to customs concerns. The approved changes to the convention will enter into force in July 2016 upon final adoption by the MSC in November 2014. In order to assist supply chain participants’ and SOLAS contracting governments’ implementation of the container weight verification requirement, MSC also issued a MSC Circular with implementation guidelines.

MSC also approved a new Code of Practice for the Packing of Cargo Transport Units (CTUs), including intermodal shipping containers. The new CTU Code, which will replace the current IMO/ILO/UNECE Guidelines for packing of CTU, has already been approved by the UNECE (United Nations Economic Commission for Europe) and will now go to the International Labour Organization (ILO) for approval. The CTU Code provides information and guidance to shippers, packers and other parties in the international supply chains for the safe packing, handling and transport of CTUs.

Of particular interest for regulatory authorities is Chapter 4 – “Chains of responsibility and information” which deals with the parties responsible for the provision of information and other security and regulatory requirements concerning containers as they are transported across the supply chain.

The World Shipping Council (WSC), whose members represent about 90 percent of global containership capacity, has been a leading advocate for the container weight verification requirements and has worked cooperatively with the IMO for over seven years to see them materialize. WSC has also participated in the group of experts that developed the new CTU Code.

“In taking these decisions, the IMO has demonstrated its continuing leadership in trying to ensure the safe transportation of cargo by the international shipping industry,” said WSC President & CEO, Chris Koch. “We congratulate the IMO Secretary General and the IMO member governments for developing and approving these measures that, when properly implemented and enforced, should provide for long-needed improvement to maritime safety. The SOLAS amendments and related implementation guidelines regarding container weight verification represent a collaborative effort that we were pleased to be a part of and we look forward to final adoption of the amendments in November 2014.”

The new CTU and supporting material can be accessed at the UNECE website here. Also See the World Shipping Councils webpage here for chronological information about the container weighing issue. Source: Maritime Executive