Report on Integrated Maritime Policy 2016

25 BSPCYEARSBaltic Sea Parliamentary ConferenceThe Rapporteurs on IntegratedMaritime PolicyReport 2015/201625 BSPCYEARSBaltic Sea Parliamentary ConferenceThe Rapporteurs on IntegratedMaritime PolicyReport 2015/20162The BSPC Rapporteurs on The Baltic Sea Parliamentary ConferenceIntegrated Maritime Policy (BSPC) was established in 1991 as a forum forpolitical dialogue between parliamentariansfrom the Baltic Sea Region. BSPC aims at rais-© BSPC Secretariat ing awareness and opinion on issues of currentpolitical interest and relevance for the BalticText: Jochen Schulte, Jörgen Pettersson Sea Region. It promotes and drives various in-Editing: Bodo, Bahr, Florian Lipowski itiatives and efforts to support a sustainableLayout: produktionsbüro TINUS environmental, social and economic develop-Photos: BSPC Secretariat ment of the Baltic Sea Region. It strives at en-hancing the visibility of the Baltic Sea Regionand its issues in a wider European context.BSPC gathers parliamentarians from 11national parliaments, 11 regional parliamentsand 5 parliamentary organisations around theBaltic Sea. The BSPC thus constitutes aunique parliamentary bridge between all theEU- and non-EU countries of the Baltic SeaRegion.BSPC external interfaces include parlia-mentary, governmental, sub-regional and oth-er organizations in the Baltic Sea Region andthe Northern Dimension area, among themCBSS, HELCOM, the Northern DimensionPartnership in Health and Social Well-Being(NDPHS), the Baltic Sea Labour Forum(BSLF), the Baltic Sea States Sub-regional Co-operation (BSSSC) and the Baltic Develop-ment Forum.BSPC shall initiate and guide political ac-tivities in the region; support and strengthendemocratic institutions in the participatingstates; improve dialogue between govern-ments, parliaments and civil society; strength-en the common identity of the Baltic Sea Re-gion by means of close co-operation betweenBaltic Sea Parliamentary Conference national and regional parliaments on the basiswww.bspc.net of equality; and initiate and guide political ac-tivities in the Baltic Sea Region, endowingBodo Bahr them with additional democratic legitimacyHead of BSPC Secretariat and parliamentary authority.bb@bspc.net The political recommendations of the an-nual Parliamentary Conferences are expressedin a Conference Resolution adopted by con-sensus by the Conference. The adopted Reso-BSPC Secretariat lution shall be submitted to the governmentsc/o Lennéstraße 1 of the Baltic Sea Region, the CBSS and the19053 Schwerin EU, and disseminated to other relevant na-Germany tional, regional and local stakeholders in thePhone (+49) 385 525 2777 Baltic Sea Region and its neighbourhood.3ContentsPreface 4A – Activities of the Maritime Rapporteurs 6European Maritime Day (EMD) in Turku and follow-up 6Vasco da Gama Final Conference in Brussels 10Ferry Shipping Conference 12Åland Maritime Day in Mariehamn 13B – Legislative Developments at the EU levelwith regard to all BSPC members 14Stricter SECA regulations as of 1 January 2015 14HELCOM agrees on a Roadmap for a Baltic Sea NECA 15Passenger ship sewage discharges intothe Baltic Sea will be banned 16Research and innovation in the Blue Economyto create jobs and growth 16Support for “Blue Projects” in education,research and innovation 17Targeted review of the General BlockExemption Regulation: extension to ports 18Port Package III 19Safety Rules and Standards for Passenger Ships 19C – Shippax Conference Summary 214 PrefacePrefaceThis report summarizes the developments in the Integrated Mari-time Policy (IMP) field since the renewed appointment of MPJochen Schulte (Mecklenburg-Vorpommern) and of MP JörgenPettersson (Åland Islands) as BSPC Maritime Rapporteurs by theStanding Committee at the conference in Rostock.A number of interesting conferences have taken place throughoutthe past year, such as the Åland Maritime Day, the European Mari-time Day in Turku, or the Vasco da Gama Final Conference inBrussels. For further information on the conferences please refer tothe first part of the report. One of the striking developments hasbeen the great push from all levels of governance in Europe to great-ly invest in skills development in the Blue Economy. This can onlybe seen as a positive development and should receive the full sup-port of the Baltic Sea Parliamentary Conference, also bearing inmind its Work Programme 2015-2016. For the transformation ofthe Blue Economy is driven by skilled people. Industry and educa-tion providers must be connected to plug the skills gap and to en-sure that a new generation of marine scientists, professionals, tech-nicians and entrepreneurs is trained.Aside from the information on what is done to promote skills devel-opment in the Blue Economy we have included a number of otherimportant legislative developments at the international level in thesecond part of our report, which are going to affect our own indus-tries and those of third countries operating in the Baltic Sea. Amongothers, HELCOM has finally agreed on a Roadmap for a Baltic SeaNOx Emission Control Area (NECA). In this part of our report wealso provide a brief update on shipping companies’ experiences withthe stricter Sulphur Emission Control Area (SECA) regulations,which went into effect on 1 January 2015. Further, we update on anumber of other legislative acts that were the subject of previous re-port. Other updates concern passenger ship sewage discharges, sup-port for “Blue Projects” in education, research and innovation, stateaid rules, and the third Port Package.We call upon stakeholders to realize that sustainability can helpdrive the growth of a sector that already represents €550bn of grossvalue added and provides 5 million jobs. But policymakers mustalso push for improved ocean governance that safeguards the ma-rine ecosystem and biodiversity, while simultaneously providing le-gal certainty and providing markets for sustainable blue invest-ments.Preface 5Jochen Schulte Jörgen PetterssonIn the third part of this report we included a conference summaryby MP Jörgen Pettersson about this year’s Shippax Conference. Thearticle includes a detailed summary of current trends in shipping.Riga 28 August 2016Jochen Schulte Jörgen PetterssonMaritime Rapporteur Maritime Rapporteur6 A – Activities of the Maritime RapporteursA – Activities of the MaritimeRapporteursEuropean Maritime Day (EMD) in Turku andfollow-upSince the end of the BSPC Working Group on Integrated MaritimePolicy, the BSPC has been represented at the European MaritimeDays through its Maritime Rapporteurs. This year, MP Jörgen Pet-tersson from the Åland Islands participated in the EMD 2016,which took place on 18-19 May in Turku, Finland.All of the workshops of this year’s edition ran under the dictum toinnovate, learn and adapt, driven by the need for greater sustaina-bility in the Blue Economy.The European Commissioner for Environment, Maritime Affairsand Fisheries, Mr Karmenu Vella, underlined that the drive forgreater sustainability is opening up new global business opportuni-ties. For instance, renewable energy from the sea has a huge globalpotential. The Carbon Trust – an independent expert organizationdealing with carbon reduction, resource efficiency strategies andcommercializing low carbon technologies – estimated a total of€525bn cumulative market value by 2015. The growth of offshorerenewable energy has far outstripped that of more traditional mari-time sectors. 90% of wind turbines are located in European waters.Employment in the European offshore industry has now reachedhalf that in fishing.In order to ensure the sector’s future, the Commissioner deemed itnecessary to encourage investors to back smart and sustainable solu-tions. Accordingly, Blue Growth should be encouraged more sys-tematically than in the past. To do so, the Commissioner outlined3 fields of action:Firstly, the Commission works closely with the industry, MemberStates and regions to produce a strategic roadmap for the ocean en-ergy sector by the end of 2016 as part of the Ocean Energy Forum.The Commissioner explained that initially, solar and wind powerhad benefitted from electricity prices that had reflected the costs as-sociated with their novelty. Without this support they would nothave taken off. As they moved to mass production, costs had plum-meted. Lessons should be drawn for tidal and wave energy.A – Activities of the Maritime Rapporteurs 7Secondly, the Commission has launched three calls over €7.5m topromote innovation and investment in the Blue Economy. This isin line with the BSPC’s Work Programme, which has identified thelabor market in the Baltic Sea Region and labor mobility – amongothers – as key priorities of its work in 2015/2016.Specifically, the European Commission posits that the transforma-tion of the Blue Economy can only be driven by skilled people.However, the industry repeatedly points out that qualified profes-sionals are in short supply. Therefore, the Commission has launcheda Blue Careers initiative, aiming to connect industry and educationproviders, close the skills gap and train a new generation of marinescientists, professionals, technicians and entrepreneurs. The BSPCwill address similar challenges at its Silver Jubilee edition at the endof this month in Riga.The Commission has also launched a Blue Labs call, encouragingpartnerships between young researchers and the business communi-ty, and a Blue Tech call, aiming to develop a pipeline of bankable,ready-to-invest demonstration projects in order to help make theleap from research results to business ventures.But skills development in the Blue Economy is also driven by theregions. Please refer to the following section on the Final Confer-ence of the Vasca da Gama project for more information on thesubject.Thirdly, investments should be encouraged by reducing the per-ceived risk in the Blue Economy. Financial institutions need to lookmore favorably on the risk that inevitably comes with innovation.Therefore, the Commission has launched the European Fund forStrategic Investment (EFSI). About €315bn has already been mobi-lized by the EFSI and has been used towards large Blue Economyprojects. The Commissioner cited Denmark as a best practice exam-ple for a country that invests in innovation. As such, the country setup a fund worth €2bn to invest in large energy projects, includingoffshore wind. Denmark is using the EFSI guarantee to convinceprivate investors to contribute to this fund. In addition, the Com-mission also set up a European Investment Project Portal (EIPP),which serves as a bridge between EU project promoters and inves-tors worldwide thereby catalyzing and accelerating the fruition ofmore EU investment opportunities. It is part of the “InvestmentPlan for Europe” and is one of multiple strands pursued by theCommission with the goal to revive EU investment activity. Theminimum EIPP project size is €10mn.8 A – Activities of the Maritime RapporteursLastly, the Commissioner highlighted the need of improved inter-national ocean governance. The current framework would not en-sure a level playing field, provide enough legal certainty and safe-guard marine ecosystems and biodiversity. The issue was also raisedG7 Environment Ministers’ Meeting on 15-16 May in Toyama,where it was included in the conclusions of the summit.Further key messages emerging from the two intense days of debateinclude:• Clusters are enablers that can connect good ideas – of SMEsand others – to industry partners and finance providers andhelp drive transitions to new Blue Growth activities.• Sectors such as ocean energy provide massive opportunities forgrowth, jobs and global environmental gains; we should not bediscouraged by the challenges that are still outstanding, butshould tackle them gradually and keep a long term focus.• Ocean Energy also shows how important it is to prioritize strate-gic investments that provide returns not only in economic termsbut also in terms of climate and environmental benefits.• Access to finance continues to be a challenge. Policy makershave a huge responsibility to strengthen risk guarantees, cut redtape and ensure stable regulatory environments.• Action at regional level has a huge role to play in boosting BlueGrowth. The most advanced regions are systematically develop-ing their transnational partnerships to maximize their potentialand bundle strengths. This could be further facilitated throughwider Blue Growth platforms that could turn the ambitions ofthese actors into concrete and joint investments.• If we are to get a return from all the investments in innovationand infrastructure, developing skills is critical. It is hard to pre-dict what future jobs will entail, so it is important to educatealso for the ‘unknown’.• The element to emphasize when attracting capable and moti-vated young people to maritime careers is not just the purelytechnical interest of the profession but also the role of ‘stewardof the oceans’.A – Activities of the Maritime Rapporteurs 9• Blue Growth can only thrive within a strong and reliable inter-national ocean governance system, for which intense coopera-tion and stricter implementation and enforcement globally areneeded.One of the most interesting topics at the Conference were the useof autonomous vessels in the future. Some of the conclusions werethat the regulators should:• Support research, technology development and standards forautonomous vessels.• Take the lead and coordinate development of a new regulationsframework for autonomous vessels with the aim to make pro-posals to IMO.• Promote a goal/performance based regulatory framework thatdoes not rely heavily on prescriptive requirements and legacytechnologies.• Facilitate trials and piloting efforts by making exemptions fromcurrent regulations and establish designated test areas for un-manned vessels.• Support research and standardization within cyber security,with focus on maritime context and applications.• Realize the importance of standards for quality assurance andto achieve interoperability, competition and economies of scale.• Foster data governance in order to enable a fair and fertile envi-ronment for new data-driven services that will capitalize onEUs technology excellence and trigger high skill job creation.10 A – Activities of the Maritime RapporteursVasco da Gama Final Conference in BrusselsThe issue of skills development in the maritime economy was the coreof the project “Vasco da Gama – Training for Greener and Safer Mar-itime Transport”. Jochen Schulte attended the Final Conference of theproject on 1 March in Brussels.The aim of the project was to contribute to achieving the developmentof high professional skills and the development of Education andTraining within the EU. In particular, it focused on improving theskills of persons employed in European shipping with a view to ad-dressing specific challenges such as maritime safety and the reductionof environmental damage. It also aimed to lay the foundations for mo-bility within Europe, involving education and training institutions.The project was led by the Conference of Peripheral and Maritime Re-gions of Europe (CPMR), an organization that brings together some150 regional authorities.The main drivers of the project – the French region of Bretagne andMecklenburg-Vorpommern – emphasized the importance of mari-time professions at the regional level. Jochen Schulte praised the pro-ject’s character as an incubator for projects covering a variety of topicsand geographical areas, all focused on promoting mobility and the keyrole given to regional authorities, while at the same time developingpartnerships with other professional and academic stakeholders fromthe sector. Jochen Schulte underlined the activities of the BSPC in thisrespect, not least against the background of the current BSPC WorkProgramme.The Maritime Rapporteur recapitulated the lessons-learned from theproject.1) The importance of exchange programs: The first Vasco da GamaSummer School was held on 24-29 August 2015. It was organizedjointly by the CPMR and Kalmar Maritime Academy. Partici-pants from the Atlantic, Baltic, Black Sea and North Sea benefitedfrom briefings and discussion time with high-level speakers on theissues of maritime safety and security, integration of the human el-ement and cultural influences in these areas, and greening of mar-itime transport. A series of case studies and exercises gave an oper-ational dimension to the training course. All parties involved hadagreed that this first Summer School had been a great success andthat it is worth repeating in the future. It is the stated goal of theorganizers that the lessons learned from this first edition will helpto develop the content of future Vasco da Gama Summer Schools.This important milestone should be further developed.A – Activities of the Maritime Rapporteurs 112) The contribution to the networking of the stakeholders: For in-stance, cadets from the involved academies can participate in ex-perimental pilot training sessions that will be organized in 2 differ-ent maritime basins. A high-quality cross-national master pro-gram in Sustainable Shipping at an advanced level has been devel-oped, which ran from January to June 2015, with the participa-tion of close to 50 people: students and seafarers from Sweden,France and Germany. Various professionals from across the ship-ping supply chain have been brought together in the developmentof a course module. The project has thus contributed to a networkof partners, which extends from the Black Sea over other sea ba-sins all the way to the Baltic Sea, and which constitutes the nucle-us for exchange and cooperation in this region.3) The necessity of the input from the involved regions: The regionsare key actors in the improvement of the attractiveness and inter-nalization of maritime professions, as they are responsible for edu-cation and training, as they are drivers of regional economies andeconomic sectors, and as they are the ones best equipped withknowledge about the local and regional situations and needs. Thedifficulty – and the objective of this project – lies in combiningthese strengths and insights in a mutually beneficial manner.Jochen Schulte concluded by urging stakeholders to continue andbuild upon the “Vasco da Gama” label even after its formal conclu-sion. The project could be continued in the framework of the separatesea basins, for instance with support from Interreg. GD MARE distin-guishes its Blue Growth initiative among others based on sea basins,and the education and training in maritime professions should be anintegral part of any growth strategy. The regions could offer theirknow-how to the Commission and its GDs in so far as personnel andquality needs are concerned, for instance in the areas of sea traffic orthe “Blue Economy”.To do so, CPMR should mind the EU context. It must turn to respec-tive priorities and initiatives to complete them, to develop technicalsynergies with them and, to participate in them as appropriate. Specialattention should be paid to the initiatives such as the Blue Careers In-itiative. The CPMR is already working on sectors such as maritimetransport, port logistics, and shipbuilding as part of discussions on theimplementation of technical partnerships that should ensure the de-sign and development of European cooperation projects.The regions play an equally important role in this regard. A conceptcatalogue should be developed based on the experiences gained so farand together with the CPMR General Secretariat interregional pro-jects should be designed and implemented by the regions.12 A – Activities of the Maritime RapporteursFerry Shipping ConferenceOn 13-14 April Jörgen Pettersson participated in the fourteenthedition of the Ferry Shipping Conference that took place on boardSilja Symphony, trafficking between Stockholm and Helsinki. Overforty different speakers shared their knowledge, experiences, andanalyses during these intense days. After the moderator Bo-LennartThorbjörnsson and Tallink Group’s CEO Janek Stalmeister openedthe conference by tradition; hitting the ship’s bell, the floor andopening speech belonged to the main sponsor Anders Rundberg,CEO of Carus:“It looks brighter in many ways, but we must never be complacent. It isimportant to continue to work to attract new customers on board, notjust those that are recurring. The UK has been successful with joint ven-tures – such as National Ferry Fortnight, for people to choose the ferries– which we should do in the Baltic Sea as well.”Bo-Lennart Thorbjörnsson went on to set the tone for the two dayswith the heading “Where is the industry now?” He highlighted thefact that many of the world’s shipping companies made very goodresults last year. DFDS outperformed all time high while the othermajor actors, i.e. Viking Line, Rederi Ab Eckerö and Tallink Groupraised its earnings significantly: “We look positively on the futureand we have strengthened our office organization to keep develop-ing our service and fleet.”A – Activities of the Maritime Rapporteurs 13Åland Maritime Day in MariehamnOn 12 May Jörgen Pettersson attended the Maritime day in Marie-hamn. At the event there were both company presentations andseminars. One of the interesting seminars addressed the question ofhow to install scrubbers and methanol installations without mal-functions. The CEO of Godby Shipping Dan Mikkola said in hispresentation that until 2014 the company concentrated on runningits ships as efficiently as possible: “Today we are looking for goodsecond hand vessels. From 2017 and forward we will be looking atnext generation ships.”Per Stefenson, Marine Standards Advisor, Stena Teknik talked aboutfast and smooth installations of scrubbers on existing ships.Everything is loaded during normal harbor time and installationsare made by a team at sea. He also talked about methanol fuel. Ste-na Germanica is the world’s first methanol ship. Wärtsilä has devel-oped the technique to convert existing engines. Methanol leads theway to the zero vision it is therefore a sustainable fuel for globalshipping.Tommy Mattila, Sales and Marketing Director, at Skangas talkedabout LNG as a fuel for the future. LNG fulfills all coming emis-sion regulations as such without any extra systems. There is no oilspill risk. The price development of LNG is foreseen to be more sta-ble than that of oil. However the LNG supply chain is more expen-sive than that of oil especially in the startup phase when the vol-umes are small. There are currently 165 confirmed LNG projects.He stated that:• Environmental restrictions will get stricter – natural gas /LNGis a part of the solution for Industry, Marine and Traffic seg-ments.• Significant resources of gas and increased infrastructure ensureavailability and competitiveness.• LNG will be a major fuel for shipping.14 B – Legislative Developments at the EU level with regard to all BSPC membersB – Legislative Developments atthe EU level with regard to allBSPC membersStricter SECA regulations as of 1 January 2015One ongoing theme of our work has been the challenge of vesselsbeing subject to stricter regulations both at global or regional levelfor 10 years since the creation of the first EmissionControl Area in the Baltic Sea. Since, ECAs have been enlarged toThe Channel and North Sea, as well as North America and the max-imum sulphur content has been reduced gradually from 4.5% to1.5% and 1% up to this date, while the regulations set new limitsin 2015 at 0.1% sulphur, which presents significant challenges forthe industry including oil majors, shipping lines and shippers.Already in our previous reports we informed extensively aboutSECA and its potential impact. Now that shipping companies havehad some time to evaluate the situation it must be concluded thatthe impact on shipping companies has not been as severe as predict-ed and that a modal shift from sea to land has not taken place to thedegree that could be expected. This conclusion is based both on ourtalks with shipping companies throughout the past two years, aswell as on statements made by shipping companies in the context ofthe European Maritime Day 2016 in Turku (see also Section Aabove).However, the reason for the good news is also due to the fact thatthe context in which shipping companies operate has been more fa-vorable than could be expected. Most importantly, oil prices are ata long-time low. Fuel prices went down with the global reduction ofthe crude oil price from close to $ 100/barrel to $ 30/barrel (Q32014 vs. Q1 2016).Therefore, despite of the fact than shipping companies had to retro-fit ships and/or order new builds, the additional costs due to thestricter SECA regulations did not have to be borne by the custom-ers, nor did shipping routes on a larger scale have to be abandoned.However, this may well still change, depending on the economiccontext.B – Legislative Developments at the EU level with regard to all BSPC members 15As was pointed us by us in last year’s report, we therefore continueto urge to investigate, if and how a modal shift from sea to land hastaken place since the introduction of the stricter SECA regulationson 1 January 2015. Should such a modal shift have indeed takenplace it would then be in order to evaluate how counter-measurescould be initiated and how the affected sector can be supported,bearing in mind EU state aid rules.We will continue to monitor the development and inform theBSPC accordingly.HELCOM agrees on a Roadmap for a Baltic SeaNECAOn 10 March 2016 the Annual Meeting of the Helsinki Commis-sion (HELCOM), consisting of the Baltic coastal countries and theEU, agreed on a Roadmap, which includes a commitment to sub-mit to IMO a proposal for a Baltic Sea NOx Emission Control Area(NECA) - according to the IMO MARPOL Convention Annex VI- in parallel with the North Sea. According to the Roadmap it willbe submitted to the IMO MEPC 70 meeting, scheduled for nextautumn.Nitrogen Oxide (NOx) emissions from shipping is a major sourceof airborne deposition of Nitrogen, aggravating the serious eu-trophication of the Baltic Sea. According to estimates, Baltic SeaNECA has potential to cost-efficiently and significantly - around 7kilotons - reduce Nitrogen input to the Baltic Sea annually after atime lag needed for fleet renewal as the regulation addresses onlynew ships.The initiative for a Baltic Sea NECA emerges from the HELCOMBaltic Sea Action Plan, agreed by the nine coastal countries and theEU in 2007.Beginning tomorrow the coastal countries and the HELCOM Sec-retariat will prepare for a submission to the MEPC 70 Meeting,scheduled to take place in October 2016. This Baltic Sea NECAsubmission is planned to take place parallel to a similar NECA sub-mission from the North Sea countries.16 B – Legislative Developments at the EU level with regard to all BSPC membersPassenger ship sewage discharges into the Baltic Seawill be bannedIn April 2016 the International Maritime Organization (IMO)agreed that the Baltic Sea special area for sewage discharges frompassenger ships under Annex IV or the MARPOL Convention willtake effect by latest 2021 for IMO registered passenger vessels.However, in certain cases of direct passages between St. Petersburgarea and the North Sea there is a two-year extension to the deadline,until 2023.The decision means that by 2021 all IMO registered passenger ves-sels sailing in the Baltic Sea, as the first region in the world, mustdischarge all sewage at port reception facilities, or treat it with anon-board treatment plant certified to meet stringent special area re-quirements. For new ships built on or later than 2019, these re-quirements will apply earlier.By the IMO meeting in April, all Baltic coastal countries had sentconfirmation of adequate reception facilities in Baltic ports, as a re-sult of substantial work on port reception facilities for sewage andtheir use in the Baltic Sea area by national administrations, portsand the passenger ship industry (see also last year’s IMP report).The Baltic Sea parliamentarians have always supported the notionof bringing economic and ecological aspects together, as much aspossible. Especially for the tourism sector, the good ecological stateis an indispensable pre-condition in the competition with other re-gions. And for this reason, we also have to bear in mind economicaspects when devising strategies for the protection of the Baltic Sea.Against the background of these challenges we will continue to callfor the implementation of an EU-wide concept for the set-up ofport reception facilities.Research and innovation in the Blue Economy tocreate jobs and growthOn 8 September 2015 the European Parliament adopted a resolu-tion on untapping the potential of research and innovation in theBlue Economy to create jobs and growth. It refers to a Commissioncommunication of 8 May 2014 entitled ‘Innovation in the BlueEconomy: realizing the potential of our seas and oceans for jobs andgrowth’. The Commission regards aquaculture, coastal andB – Legislative Developments at the EU level with regard to all BSPC members 17maritime tourism, blue biotechnology, ocean energy and deep seamining as economic sector with special economic potential. TheEuropean Parliament regards this definition and approach as toonarrow, as it does not cover all important aspects of Blue Growth,and demands a comprehensive action plan. The EP especially con-siders maritime research and good vocation training and educationan important basis for the Blue Economy. The precautionary prin-ciple and the eco system approach should form the basis of the BlueEconomy. Regarding the financing of the Blue Economy the differ-ent EU financial instruments should be better integrated, amongothers also a knowledge and information community.Support for “Blue Projects” in education, researchand innovationOn 13 September 2016 the EP Intergroup ‘Seas, Rivers, Islands andCoastal Areas’ discussed prospects for Blue Growth in the Baltic SeaRegion. DG MARE announced a call for blue technologies for thespring of 2016, which has now been launched. €2.5m shall be madeavailable for the different European sea basins. The gained insightsshall form the basis for a European master plan “Blue Technology”and support Blue Growth in the European sea basins.The call is part of a larger initiative that the Commission announcedon 2 February 2016, which with “Blue Projects” in education, re-search and innovation are supposed to be funded. The call “BlueCareers in Europe” aims at contributing to fill existing skills’ gapsby supporting activities that will increase the employability of vari-ous target groups in Blue Economy sectors (e.g. students, workers,unemployed people etc.). It is intended to contribute to training anew generation of students, scientists, professionals, techniciansand entrepreneurs equipped with the appropriate skills to matchthe needs of the industry and to provide people already working inthe field with the new skills required.On 5 April 2016 the Commission formally launched the aforemen-tioned calls for the Blue Economy. With over €7.5m projects in thefollowing areas will be supported: “Blue Jobs” (€3.45m for up to 7projects), “Blue Labs” (€1.7m for up to 6 projects), and “Blue Tech-nology” (€2.52m for up to 4 projects. For further information onthe Blue Careers initiative, please refer to the summary of Commis-sioner Vella’s speech in the context of the European Maritime Day2016 in Turku under Section A of this report.18 B – Legislative Developments at the EU level with regard to all BSPC membersTargeted review of the General Block ExemptionRegulation: extension to portsOn 10 February 2016 DG COMP passed a roadmap, which in-tends to simplify the scope of EU state aid rules, codify the existingdecision-making practice, abolish reporting obligations, and yieldcost savings. To this end, the Commission intends to include portsin the general block exemption within the EU competition laws.The prerequisite for a corresponding change of the general block ex-emption would be a sufficient case practice.According to EU competition laws Member State are obliged tohave state aids approved by the Commission in advance. Certain in-frastructural investments in ports can be affected by this. With theinclusion of ports in the general block exemption could be exemptfrom notification, given certain prerequisites. If implemented, portprojects could be implemented faster and cheaper. The Commis-sion announced two public consultations, including the MemberStates. However, the roadmap did not contain details regardingconcrete changes to the general block exemption, nor regarding theconcrete timing.On 7 March 2016 DG COMP then opened a public consultationto adapt the general block exemption Regulation. It proposes ex-emptions from the notification obligations for ports. The consulta-tion ended on 30 May 2016. Investment aid in ports for projects upto €100m (€120m for TEN-T ports) shall be exempt from the no-tification obligations. State aid should under no circumstance ex-ceed the funding gap of a project. Furthermore, the infrastructurehas to be be available to all users in a non-discriminatory fashion.The following aid intensities are envisaged:• Projects up to €20m: 100% aid intensity• Projects between €20m and €50m: 80% aid intensity• Projects between €50m and €100m (€120m for TEN-T ports):50% aid intensity.On the basis of the results of the consultation the Commission will re-write its proposal and launch a second consultation, most likely this fall,before the final EU regulation will be passed.B – Legislative Developments at the EU level with regard to all BSPC members 19Port Package IIIOn 25 January 2016 the Transport Committee of the EuropeanParliament approved the draft report regarding the third port pack-age. Key elements of the report include the financial transparency inports, as well as rules regarding education and training of port em-ployees and the strengthening of social dialogue (see also previousIMP reports).In the same vein as the Council, the committee significantly eased pro-posed rules, for instance regarding piloting and dredging services,which were exempt. With a view to state aid law the EP asks of theCommission to clarify the notion of State aid with regard to the financ-ing of port infrastructures, and to include port infrastructures in thegeneral block exemption regulation with adequate threshold values.On 8 March 2016 the plenary of the European Parliament submittedits position regarding the proposal for a regulation of the EuropeanParliament and of the Council establishing a framework on marketaccess to port services and financial transparency of ports, and fol-lowed the vote of the EP Transport Committee from January.Safety Rules and Standards for Passenger ShipsOn 6 June 2016 the Commission adopted a number of legislativeproposals to simplify and improve the common rules on safety ofships carrying passengers in EU waters. The update is a response tolessons learnt, including from accidents, and technological develop-ments.The revision aims to simplify and streamline the existing EU pas-senger ship safety regulatory framework, in order to maintain EUrules where necessary and proportionate; ensure their correct imple-mentation; and eliminate potential overlap of obligations and in-consistencies between related pieces of legislation.An overarching objective is to provide for a clear, simple and up-to-date legal framework that is easier to implement, monitor and en-force, increasing thus the overall safety level.Commission proposal amending Directive 2009/45/EC on safetyrules and standards for passenger ships – Among others, it is pro-posed to clarify and simplify the safety rules and standards for20 B – Legislative Developments at the EU level with regard to all BSPC memberspassenger ships so that they are, in line with the Commission’s RE-FIT program, easier to update, monitor and enforce. In view of in-creasing legal clarity and certainty, the proposal also intends to re-move a number of outdated, redundant and inconsistent legal refer-ences.The proposal amends the corresponding definitions and require-ments of Directive 2009/45/EC.In addition, the proposal provides for the alignment of Directive2009/45/EC with the changes brought about by the Treaty of Lis-bon in regard of the powers of the Commission to adopt delegatedand implementing acts.Commission proposal on a system of inspections for the safe opera-tion of ro-ro ferry and high-speed passenger craft in regular service –Council Directive 1999/35/EC2 provides for a number of types ofinspection addressing particular safety characteristics of ro-ro ferriesand high-speed craft (HSC). These address specific risks related toundivided vehicle decks giving rise to stability and fire vulnerabili-ties, very intense activity, the risks of cargo shift, water-tightness is-sues, hoistable ramps and wear & tear.The requirements of this Directive no longer match the realities andwill therefore have to be adopted.It is therefore proposed to update, clarify and simplify the existingsurvey requirements for roro ferries and HSC while maintaining thesame level of safety and key delivery mechanisms. This is in linewith the Commission’s REFIT program and aims to further ration-alize the inspection effort of national administrations and to maxi-mize the time in which the ship can be commercially exploited.In this vein, in order to ensure clarity and coherence, the proposalrepeals the current Directive and replaces it with a new Directive. Italso includes ancillary changes to Directive 2009/16/EC.C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conference 21C – Shippax ConferenceSummary“Grounds for optimism”(by Jörgen Pettersson) published in Shippax CFI 6/2016There is a vibrant future in passenger and ro-ro traffic.It’s not a coincidence that 404 delegates and thirty exhibitors par-ticipated in the fourteenth edition of the Ferry Shipping Confer-ence that took place on board Silja Symphony, trafficking betweenStockholm and Helsinki on 13-14 April 2016. This kind of rallyingis a new record and leaves great promises for the future.Over forty different speakers shared their knowledge, experiences,and analyses during these intense days. After the moderator Bo-Len-nart Thorbjörnsson and Tallink Group’s CEO Janek Stalmeisteropened the conference by tradition; hitting the ship’s bell, the floorand opening speech belonged to the main sponsor Anders Rund-berg, CEO of Carus:• It looks brighter in many ways, but we must never be compla-cent. It is important to continue to work to attract new custom-ers on board, not just those that are recurring. The UK has beensuccessful with joint ventures – such as National Ferry Fort-night, for people to choose the ferries – which we should do inthe Baltic Sea as well.Rundberg went on to highlight the Åland Islands where the ITcompany, which doubled its business last year, has its headquarters:• We have since 1850 developed shipping and made Åland to awellknown maritime hub. Therefore, Carus could be formed in1999. We live and breathe ferries, both in passenger and cargooperations, and today we have a diversified and global custom-er base.22 C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships ConferenceBo-Lennart Thorbjörnsson went on to set the tone for the two dayswith the heading “Where is the industry now?” He highlighted thefact that many of the world’s shipping companies made very goodresults last year. DFDS outperformed all time high while the othermajor actors ie Viking Line, Rederi Ab Eckerö and Tallink Groupraised its earnings significantly.• The vast majority of shipping companies showed noticeableimprovement, even in the Mediterranean, and the battle of thechannel between P&O and DFDS is over, he said.There are several reasons but the most obvious one is that there arestronger markets with more purchasing power, low interest rates,trimmed organizations and a low bunker price.• It is thus, against this background question itself, you ask your-self where all shipbuilding orders are. Are all shipyards full? Areshipping companies unsure of what type of ship suits the futurebest? Are the fuel costs of the future what baffles shipping com-panies or have they lost the internal know-how required fornew construction projects?The rhetorical questions will get their answers eventually, andBo-Lennart Thorbjörnsson added that there are also exceptions:• Attica, Stena, Destination Gotland and DFDS are some exam-ples of ship owners who has settled the matter and signed newshipbuilding contracts.After prosperous years there are years of setbacks, but Thorbjörns-son do not think it will happen in the next two three years. Howev-er, he does not believe the expected industry consolidation takesplace in the short term.• We may even get to see new shipping companies appear witholder tonnage and try to enter the markets, maybe we can evenget to see high-speed ferries make a comeback.One of the reasons that ferry traffic has a brighter future are thetravellers wish to be able to move from door to door.• This can only happen with the help of cars and such cannot betaken on a plane. People want to move around themselves ontheir vacation and drive to where they want, when they want,he said.C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conference 23On the cargo side Bo-Lennart Thorbjörnsson noted that growthcontinues to be stable with the added plus for Poland and the UK,where the quantity of goods has grown considerably. A remainingchallenge instead is a lack of suitable second-hand tonnage.• It has become a seller’s market, which is a huge difference com-pared to two years ago.To build new is far from uninteresting but the wait is long becausethe ship yards already have their work sheets fully booked. Onesolution that more people choose to do is to build in China. BothStena and Destination Gotland used this option.• If you want a new passenger ferry you must be prepared to waitfive or six years of delivery, he said.A solution, against this background, is that more and more shipowners are investing more on renovation and renewal of aging ton-nage. There is also a clear trend where the onboard experiences ofthe passengers are highlighted more and more. The digitalization isstill in its infancy and the future will be crucial when it comes to at-tracting passengers. Shipping companies needs to be on their toesahead of the trend.In summary:• There are many good reasons for optimism in the industry!“Sure there is money to make on shipping”Even directors of shipping companies are increasingly positiveabout shipping and its potential.• Sure you can make money in the future, says Tallinn Group’sCEO Janek Stalmeister.But then you have to be attentive to travellers’ wishes and requirements.The first program item was a panel with some of the industry’s mostinfluential leaders. Janek Stalmeister (CEO of Tallink Group), Spi-ros Paschalis (CEO of Attica Group), Mr Grimaldi (Deputy Man-aging Director of the Grimaldi Group), Niclas Mårtensson (DeputyCEO for Stena Group) and Jan Hanes (CEO of Viking Line) beganwith a brief analysis.24 C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships ConferenceStalmeister:• There are still lots of opportunities to make money in shipping.We see, for example, more travellers from Asia and Latin Amer-ica that discovers the Baltic Sea. New times require new con-cepts on board. It is important to keep in constant contact withcustomers and ensure that we are constantly analysing theirneeds. Shopping behaviour has changed and the passengershave different needs than before. On the risk side, we have pre-vious competition from low-cost airlines but also the thoughtsand plans of Hyperloop, which challenges the entire industry aswell as the larger geopolitical uncertainty.Paschalis:• Tomorrows travellers have different expectations about us thanwhat we are accustomed to. We must be able to show social re-sponsibility and greater transparency in what we do. It will fo-cus on the Global Distribution System where a call will arrangeeverything for the customer. Passengers require internet accesson board and constant entertainment and personal service. Wemust also remember that the low price of fuel will not last for-ever, so we cannot relax when it comes to continuing streamlineoperations.Grimaldi:• I want to thank you for a fantastic event. Shippax and FerryShipping Conference is an important gathering for the entireindustry, even if we are at an upswing right now, the future isalways uncertain. The European shipping industry has environ-mental, political and strategic challenges to overcome. It mayfor example include terrorist threats and refugee crises that af-fect us all. With a close call we’ve managed to escape the newSECA regulations due to the falling oil price but it has also en-abled us, for example in the Mediterranean we see old ships,forty years of age, and more, only picking the cherries out ofthe big cake. It is not good for anyone. We still have twenty-fiveships today and are optimistic about our future.Mårtensson:• When it comes to safety, we must never forget to practice andpractice and yet again practice. Just by doing that and alwaysfollowing the rules, we avoid new ill-conceived laws. We shallalso be proactive in the implementation of new Directives. TheC – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conference 25next ballast rules are in themselves good for the environmentbut have negative consequences. Our ships traveling betweenLiverpool and Belfast (nationally) are not affected by the ruleswhile running between Liverpool and Dublin (international)must follow them. Although the traffic going over the same sea!Hanses:• Ballast Convention is a distraction right now as well as the weakeconomy in Finland and in Russia. We are also a constant topicof discussion within the Finnish government about state aidwhich is challenged at every new forming of Government. Tohandle the customers’ requirements when it comes to on boardexperiences, and because some of our ships are getting older, weare also actively working around the possibility of ordering newbuilt ships. I think it will be a reality within five or ten years.The panel discussion revolved around the many common challeng-es and opportunities of the industry.• Eventually, it is possible to start traffic between the US andCuba. When that happens, it will be extremely interesting forthe entire industry, said Guido Grimaldi.• If Britain chooses to leave the EU after the referendum on June23 the only advantage we can resume is the duty-free sales onboard! I hope that this does not happen. There is a clear advan-tage in many other ways than this that the EU holds together,said Niclas Mårtensson.• If we are about to order new ships? Well, Viking Line, we are abit old-fashioned when it comes to the balance sheets. But weare investing heavily in the renovation of the existing vessels. Ithough believe we will place a new building order within thenext five ten years, said Jan Hanses.• It’s all about balance when to buy new ships. The old vessels arethe ones we can make money off, added Mårtensson.26 C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships ConferenceThe issue of joint IT solutions dedicated the interest of the panel.UBER driving taxis without their own cars. Airbnb is a world lead-er in overnight stays, but does not own hotels and so on. Is it alsotime for the ferry business to seek similar partnerships? The ques-tion is not simple.• We have invested millions in our own IT-systems. That is notsomething we will throw away. Our customers are mostly local,and buy our brand. However, when it comes, for example,Asian clients who do not know our circumstances, it could bean idea, thought Janek Stalmeister.• Internet reservations are clearly increasing, but the dynamics ofthe system is still missing. In the future I think we need to findglobal systems for ferry journeys the same way as, for example,made in air transport, said Guido Grimaldi.• When a system like UBER and Airbnb reaches shipping indus-try it is clearly a Game Changer, stressed Niclas Mårtensson.The moderator Bo-Lennart Thorbjörnsson addressed a direct ques-tion on how shipping companies are looking to hedge fuel now thatthe price is affordable. There was no consensus.• Yes, we have hedged the bunker in a conservative manner. Notas a financial instrument, but bought in advance. So far it hasn’tbeen very successful, said Jan Hanses.• Yes, we have hedged but if it’s good or not, we will know onlylater, said Niclas Mårtensson.• No, I know that some see it as a part of business but we don’t.Everything is based still on pure speculation. That we are notwell served by, said Guido Grimaldi.• To some extent, about twenty percent, said Spiros Paschalis.• We have locked a third of our purchases until the end of thisyear, said Janek Stalmeister.C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conference 27Europe is moving towards better timesFrom the financial world came Denise Baum working at KfW IP-EX-Bank GmbH in Germany. She invited a European outlook thatlooked mostly decent but not lacking challenges.• The refugee crisis, market volatility and the new Cold War cre-ates ANGST (German expression). And as if that wouldn’t beenough put the threat of Brexit into the picture. It would bebad for Britain, Europe and the entire Western world, she said.However, economic indicators are pointing upward for most Euro-pean countries. There’s a two percent GDP growth and decliningnumbers of unemployment rates, partly thanks to the structural re-forms implemented in some of the earlier countries in crisis.• It is far from really good but it’s for the better. Increasingly pri-vate purchasing power should lead to greater investment andmore consumption, she summed up.The countries which are the worst affected are Greece, Spain, Portu-gal and Italy. They have worked hard on their government financesand are now finally on the right track.Opportunities in CubaBruce Nierenberg came from the United Caribbean Lines and de-livered a speech filled with hope in regard with what happens theday that the traffic between the US and Cuba and Mexico opens.Rush to the ports are to expect for a variety of reasons. The US is theworld’s largest nation in terms of consumption, and Mexico is itssecond largest trading partner. In addition, the Caribbean is a con-tinent characterized by long-term political stability.It is an understatement to call this an opportunity for it is muchmore than that. Those who are first on the scene have the advantageto reach a market of historic proportions. Cuba is the Caribbean’sstrongest economy and air travel is expensive.• Travelling there by sea is guaranteed to become as much as fiftypercent cheaper than flying and it will take a lot of capacitywhen Cuba will be rebuilt, said Bruce Nierenberg.28 C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships ConferenceTourism in the Caribbean is in constant growth. Last year, the num-ber of incoming travellers to Cuba increased by 17 percent, half ofall from the United States. Cuba today has eleven million inhabit-ants, and before the revolution in 1959, Cuba was number one forAmerican tourists. In addition, there are two million Cuban exilesin the United States that can look forward to easier travel betweenthe countries.US travel restrictions to Cuba are to disappear before 2017 is over.This is not wishful thinking, but probably crass reality; there areplenty of American companies that want to start investing in Cuba.The conditions are good. Cuba has five deep-sea ports and infra-structure can handle the first ferries to arrive.Reach customers with WiFiTo deliver what customers want in the future WiFi and smart mo-bile phones are necessary tools. Jan Erik Norli from Telenor Mari-time lined up arguments and evidence on how passengers can bereached.• It’s all about keeping track of where they are on board. Whenthey pass the store, we can reach them with a direct message, hegave as one example.Today, almost nothing is technically impossible that are commer-cially desirable. The background is that people love deals and aremoreover happy to exploit them.Major investment for StockholmPorts of Stockholm is investing 800-900 million euros in the threemajor port projects that will take the company and Sweden to thefuture. It is largely to upgrade three different ports belonging to thecompany; Värtahamnen in Stockholm, where a state of the art ter-minal are being completed right now, Kapellskär expanded consid-erably and Nynäshamn where a completely new cargo port is built.Deputy CEO Henrik Widerståhl for the Ports of Stockholm gazeswith great confidence into the future of the ports of Stockholm,which is currently the fourth largest cargo port in Sweden. On thepassenger side, Stockholm is by far the largest with 250 cruise shipsC – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conference 29visiting every year. This works strongly in Stockholm’s favour. Itgenerates about EUR 550 million every year and create 4,100 jobs.The guests of the hotels in Stockholm are representing as much as1,000 overnight stays or seven fully booked hotels every day. Ac-cording to surveys, 95 percent of the visitors are satisfied with theirvisit to Stockholm, and three out of four is planning to return with-in five years. Yet it’s the same with the ports like much else, they’llhave to be there for a long time to come.• Our plan right now focuses on what should be done about for-ty to fifty years from now, says Henrik Widerståhl.This business is still not completely without risks. Stockholm isgrowing with 35,000 inhabitants per year, and the city is one of Eu-rope’s strongest growth areas but the neighbour Helsinki are strug-gling harder.• And the Russian market is unpredictable.Electricity from land connectionsAs part of the work for a more sustainable society and to save onbunker it is more and more common that shipping companies arelooking for shore connections during their stays in ports. IngemarGustavsson represents the company Process Control Electric ABwhich are behind eight land sites in Sweden and Norway and is theEuropean leader in its segment. The largest sites are in Ystad and hasan output of 10 MW, which corresponds to about 1,000 electrical-ly heated homes on a normal winter day.• And also produce less emissions, less noise and lower costs, saysGustavsson.The payback period on investment is of course difficult to calculategiven the variations in oil price, but the savings are substantial anda facility that can fit in a twenty-foot container costs approximately500,000 euros.• No traffic interruptions are necessary. Installation takes placeduring travelling.30 C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships ConferenceFinnlines’ view of the futureGrimaldi owned Finnlines is one of Europe’s largest shipping linesand closely follows the global trends in trade and economic cycles,something that has never been easy. Marketing and sales managerStaffan Herlin highlights the slow recovery following the economiccrisis in Europe and its effects on exports and imports.• We see infrastructure changes that alter the balance of traffic.In Finland, we are back on the 2009 numbers and have moreimports than exports. We’ve gained back only a third of whatwe lost then. In Sweden and Germany it is very different, saysHerlin.It addition, there’s the sanctions against Russia, which are also hardon the traffic and the SECA regulations that could have been devas-tating.• Fortunately the decline in oil price played a positive role andsaved us.Even the cargo routes are changing. More and more goods areshipped on wheels of Via Baltica which Finnlines can sense. Thecompetition is, like always, about price.• SECA regulations caused more shipments to be moved up onland where there are cheap drivers, cheap fuel and cheap trucks.Had not the price of shipping fuel dropped so much we hadsuffered an enormous carbon footprint as a result of the trafficon the roads.This will happen in 2025In the passenger sector it is important to know your travellers. Notjust as they are today, but also how they will behave in the morningand ten years down the road. Ferry investments are extremely longterm deals so it’s important to bet right from the start. Chief Com-mercial Officer Janette Bell delivered a future reconnaissance basedon her current role and her background from Tesco and Procter &Gamble, two giant chains that constantly analyses its customers.The trends are, according to Bell, clear. It is about “wantingeverything and immediately”, convenience and immediate delivery,clicks versus bricks, the new green reality and digital connectivity.C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conference 31• Growth continues but the costs are being pushed down. Expec-tations for Just In Time (JIT) will be higher and travellers re-quiring more sustainability, says Janette Bell, whose recommen-dation was clear:• It is time for collaboration and partnership.“Too many dead corners “Dr. Bruce Peter works every day at the Glasgow School of Art but isalso a true ship enthusiast. He has just recently, after six years ofwork, put the finishing touches on DFDS large 150-year historybook given out this year. It is a magnificent work of 500 pages oftext on the shipping company which has grown along with Den-mark.Dr. Peter is not completely satisfied with what he sees on board theferries of today:• There are too many dead corners. Some places look like theones where dogs lies down to die... We should take lessons fromthe Apple Store, where every place breathes content. Should wemanage to attract young people on board we are required tocreate more atmosphere and better decorations, he says.There are exceptions and Bruce Peter mentions Silja Symphony andSilja Serenade as good ones with their large arcades amidships.• It creates a tremendous sense of generosity and it’s hard to finda place that doesn’t feel pleasant.Dr. Peter calls for more spas, health and sports. Tomorrow’s custom-er engages less time in drinking contests and more to the wines.• It is not enough to open up more games corners like many to-day seem to believe that the young people want.32 C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships ConferenceContainer giants for the greatToday’s container giants have become too large. It is Henrik Tid-blads conclusion as commercial manager in DFDS.• The infrastructure on land is not enough. Stocks and parkinggarages are too small for the loads to be handled rationally. Theroads to and from the ports are inadequate, he says.Tidblad also lifts the international refugee crisis as one of the indus-try’s challenges as well as geopolitical developments in Europe andthe world. All this uncertainty is also creating new opportunities forthose who embrace the digital opportunities in new technology.• Remote-controlled vessels, optimized propulsion, more auto-mation, cargo handling and so on.Upgrade vessels oftenCEO Anders Ørgård Hansen from OSK-ShipTech A/S made a re-connaissance into the future around RoPax traffic. As key factors,he cites the ability to deal with the new mobile technology, Face-book, social media and their relationship to the purchasing behav-iour of customers. He also calls for faster decisions when it comes toconstantly upgrading the design board.• Change the style more often and adapt the design to the cus-tomers. It increases sales, recommends Anders Hansen Ørgård.It is also very important that the shipping company’s managementand board have insight and interest in digital opportunities.Shipping is changing and it’s important to be part of and embracethe new digital opportunities.Duty free trade continues to increaseSince the 1980s, the world’s duty-free trade, with a few exceptionsdue to the crisis, has increased. The trade is growing by seven per-cent (roughly) annually and the sales are those around 65 billiondollars. It is even more than the growth of the number of travellersin the world (+ 6%). Still, there is room for even greater growth,C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conference 33according to Frederick Lindh, who runs Generation Research andhas great insight on the statistics and the future.• Today only 55 million Chinese have a passport. There are 1.4billion... When all start travelling you can just imagine the po-tential, he says.According to the forecasts duty-free trade should reach USD 125billion by the year of 2025. The largest product segments are cos-metics, followed by wines and spirits and tobacco. Together they ac-count for nearly 60 percent of sales.This kind of duty-free sales are mostly happening at airports. Only3.5 percent of the world’s duty free sales are done aboard the ferries,according to Fredrik Lindh. The Nordic countries however are dif-ferent. There ferries account for about 40 percent of all duty freesales. The trends in the Nordic countries are similar to those in theworld. All travellers plan their purchases in advance and are alsowilling to pamper themselves.• That fact requires communication before they come on board.When that happens they have already decided.Although the price of the products obviously play the role, and thisis where the smart phones come into the picture. Twelve percent ofthe passengers compare prices directly in their handsets.• The shopping is clearly a part of the travel experience.Understanding digital marketing?The question about the shipping companies real approach to digitalmarketing is rhetorically asked by John Crummie as a consultant inthe industry. He answers himself:• It could be much better. 48 percent of the travel industry de-scribes itself as “fast followers” when it comes to digital technol-ogy. It takes advantage of the mainstream trends to avoid risks.That’s why it can sometimes move a little too slowly.80 percent of European passengers make their travel bookings todaydirectly on the Internet. 89 percent of adults have a cell phone and66 percent of those are smartphones. The digital trend is unstoppa-ble and therefore with the Internet of Things in the future there will34 C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conferencebe many more opportunities. Among those who are traveling, it iseven clearer. Nine out of ten carry a smartphone.• Is there sufficient digital capacity in the boardroom? It is an im-portant issue for the future, says John Crummie.Think about search enginesVictor Velton works on Versonix and states that Search EngineMarketing is essential for success.• A Majority of people are using search engines to make purchas-ing decisions’. Companies such as Google understands this andtherefore make it more difficult and costly to reach customers.• It is important to avoid digital fluff, it should be easy and fast.New companies coming upFrom IESE Business School came Koert Grever to inspire a new vi-sion of the world. He brought up some examples of companies thatin a short time changed the whole industry. UBER is the world’sbiggest taxi company but does not own a single car. Facebook is theworld’s largest media company, but produces no content. Alibaba isthe world’s largest retailer, but do not have a warehouse. Airbnb isthe world’s largest accommodation provider but does not own anyreal estate.When this happens in the shipping industry all that is taken forgranted today changes. Therefore, it is important to constantlymonitor developments and act quickly.• A common rule is to overestimate what you have time to dowithin a year while underestimating what you can do in fiveyears, says Koert Grever.C – Article written by MP Jörgen Pettersson in Shippax after participation at Future Ships Conference 35Lobbyist top tipsMagnus Ehrenberg is from Sweden, he is based in Germany and be-longs to Shippax most prolific contributors. It’s not that strange.Lobbying requires contacts and lots of friends. His company Ehren-berg Communications is working with both governments, compa-nies, and everything in between. His message is clear. Keep constantcontact with politicians if you want them to listen to your argu-ments.What is a lobbyist? The lobbyist is an influencer, trying to affect de-cisions that are favourable to their clients. Lobbyists can be individ-ual citizens, organized interests groups or businesses. Does lobbyingwork?, Magnus Ehrenberg asked and gives the answer by quotingAnn-Therese Enarsson who ran the campaign to ban smoking inbars and restaurants in Sweden in 2004:”Before I started, I imagined bought people who ran in the corri-dors of Brussels. But the more I think about it, I realize that it isabout pursuing an issue over a long period of time. The fact is, thata lobbyist can just be a committed enthusiast. It’s exciting when youdiscover that individual people can actually make a difference.”Magnus Ehrenberg finally offers some things to consider when itcomes to influencing:• Focus on few and specific questions.• Select a spokesperson.• Find a strategic partner to raise your questions together.• Be open and honest.• Combine with efforts on social media.• Find political ambassadors.• Reach out before any problems occur.Baltic Sea Parliamentary Conference Secretariatwww.bspc.netBSPC Secretariatc/o Lennéstraße 119053 SchwerinGermanyPhone (+49) 385 525 2777