06 Jul Maritime Single Window – Necessity or Luxury
The Maritime industry lives in world of hardcopy – PDF, email, documents and physical signatures. For single shipment to move from source to destination it takes more than 40 documents, 150 copies and 200+ signatures. In the world of maritime trade, businesses have long struggled with issues like operational inefficiency, rising costs, and escalating competition, all while attempting to meet strict regulatory requirements and guarantee the safety of their crew and vessels.
Traditional methods of managing shipping operations, such as manual record-keeping and communication systems have been plagued by errors, delays, and high costs, making it difficult for marinas to remain competitive in a constantly evolving industry. On this backdrop, the International Maritime Organization (IMO) made amendments to the existing FAL mandate and it stresses upon certain key objectives. The primary one being having a single window for ship-shore interface.
The amendment calls for implementing the Maritime Single Window System in every Port on or before January 01, 2024. While key ports in Africa and Asia Pacific are actively pursuing, it is noted that ports in developed and other developing markets are not considering it seriously, according to industry reports.
Therefore, this brings us to the question of Maritime Single Window’s significance. Why every port needs to consider it seriously? Is it viable only to achieve sustainability goals?
What is the amendment to IMO Mandate all about?
The fresh amendments to the FAL convention were adopted at the Facilitation Committee (FAL 46) session, which met from 9 to 13 May 2022 and is expected to enter into force on 1 January 2024. The amendments update the provisions of the FAL Convention on the mandatory use and maintenance of single window systems for the electronic exchange of data in Ports for ship clearance.
This exchange of information is required on arrival, stay and departure of ships in Ports. In addition, public authorities will have to combine or coordinate the electronic transmission of the data to ensure that information is submitted or provided only once and reused to the maximum extent possible.
Why the sluggishness in adoption?
When a single window is implemented, a few challenges remain: Getting all the stakeholders and procedures on board, achieving KPIs, adhering to effective international standards dealing with regulatory changes, and all other specific challenges. Even though regulatory bodies like IMO have been insisting on widespread technology adoption to sustainability threats, the adoption rate remained less due to various factors. Some of them are listed below.
Investment
The primary reason for non-compliance is always the financial investment. While focusing on reducing logistics costs overall, investing in something new is considered a luxury. Large players have a strategy to address emission norms, and the small-medium players have not even considered sustainability as a strategy to evolve as a business house.
Timelines
According to a media report, a well-known country in South Asia has pledged to implement a Maritime Single Window System. However, they are still skeptical about the timelines because they believe at least 6-8 months are required to conceptualize, implement, test and deploy a single window system in one port.
Cybersecurity threats
While digitisation is seen as a boon, several stakeholders are reluctant to digitise their operations because of the rising cyber-attacks. According to a news report, the cyber-attacks in the UK in October 2022 rose by 40 per cent compared to 2020. Such trends do cause havoc to the overall thought process of achieving sustainability goals.
Roadmap to implement Maritime Single Window
The industry must follow a planned approach to implement a robust system like Maritime Single Window. The digital journey for any cargo organization begins with basic process automation.
This is achieved through applications that digitize different functions in the maritime ecosystem. Combining these applications and device integration creates a sound foundation for an accurate process control system. Also, this creates a good internal automation setup.
Once the internal automation setup is done, additional efficiencies come from integrating stakeholder operations. This collaboration can be achieved through a single window system and a set of APIs or industry-standard Electronic Data Interchange messages.
Once the Internal Automation and Stakeholder Collaboration layers are done, the creation of Cross Border Linkages comes into play. This is another innovation to strengthen partnerships with different ports or trade lanes that we need to solidify. This creates a unique infrastructure for Ports wherein there is an overall supply chain visibility and the possibility of exchanging critical data with partner ports’ cargo ecosystem, which will differentiate and integrate digital infrastructure.
Widespread Adoption
Several countries worldwide are now rapidly implementing a Maritime Single Window system. Some of the countries in Africa and Asia Pacific top the list. Implementation of the first phase is already over in these countries and the remaining phases will possibly be completed on or before the stipulated timeline.
Necessity or Luxury?
In a nutshell, Maritime Single Window can definitely facilitate trade and ensure smooth movement of cross-border trade. Apparently, Port authorities and governments pursue it as a luxury than a necessity due to misconceptions. Added to this, stakeholders fear a major investment and exposure of their business functions with the implementation of a transparent single window system. Therefore, a change in approach among the decision-makers is essential to achieve larger goals.