August, 2007 IIFA Newsletter Limits of Liability (Cargo Claims) By Sea - Hague Visby Rules SDR 2per kilo or SDR 666.64 per package By Road - CMR SDR 8.33 per kilo By Air- Warsaw/Montreal SDR 17 per kilo IIFA Standard Trading Conditions SDR 2 per kilo (The SDR rate on 21/08//07 according to the International Monetary Fund was 1 Euro = 0.885372 SDR http://www.imf.org Incoming President of IIFA 2007 Finbarr Cleary New IIFA Council for 2007/08 The following were elected as incoming officers of the new 2007 Council at its first meeting on 19th June 2007. President - Finbarr Cleary of Celtic Forwarding Ltd. Hon. Secretary - Richard Clery of Irish Shipping & Transport Limited Hon. Treasurer - Paddy Kenny of Schenker (Ireland) Limited Council Members: Vincent Brennan of Phoenix International Freight Services Ltd. Pat Nolan of TwoWay Aramex Brian Stears of Campbell Freight Ltd. John O'Hanrahan of DHL Freight Brett Gourlie of TDG Ireland Ltd. Retired from last Council: Graham O'Reilly of TDG Ireland Ltd. John Bermingham of Expeditors Ireland Ltd., who was Hon.Treasurer. New Members At the council meeting in June the following firms were elected as Full Trading Members: W.T. Sea- Air International BBT International Logistics Toga Freight Services At a Glance 1) 2) 3) 4) New IIFA Council New Members FIATA World Congress AEP II 5) Port Congestion 6) CLECAT focuses on green issues 7) Quinn Direct in Germany 8) Belfast reclaims land 9) Another Jack in the box 10) New Eucon Service 11) Who will control Irish Continental Grou 12) Pentagon Payments 13) Real Estat 14) Cargo 2000 pioneer dies 15) Alan Hines RIP 16) Aer Lingus Belfast Route 17) World Trade and the Doha Round – Last Ditc 18) Irish Ferries’ new ship 19) Piracy Plague and the last word. Please feel free to forward this Newsletter to any interested colleagues, who can register to receive it directly from us at 1 iifa@eircom.net Colm Walsh Chief Executive IIFA For the next council meeting there are four applications for consideration for membership as full trading members: ICS Forwarding Ltd Hawthorn Logistics Hamilton Shipping Ltd Aquaship Agencies FIATA World Congress The FIATA World Congress is taking place in Dubai this year from October 18 - 22 under the patronage of His Highness General Sheikh Mohammed Bin Rashid Al Maktoum who is Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai. H.H. Sheikh Ahmed Bin Saeed Al Maktoum President of Dubai Civil Aviation and Chairman of This is the second time Dubai has hosted this event since 1999. Emirates Group who The theme of the Congress is "Economic Mobilisation through is also Patron of the Transport Logistics". National Association of Freight and Logistics (NAFL) in UAE. With direct flights from Dublin to Dubai, it represents a unique opportunity to make world wide contacts in the logistics and forwarding world and at the same time view the many landmark developments in Dubai and feel its dominance as the region's freight and logistics capital. Please contact us at IIFA@eircom.net or phone 01 8455411 for the Congress brochure. See also http:www.fiata2007.ae or email any questions directly to FIATA2007@mci-group.com The venue is The Grand Hyatt Hotels and Convention Centre. The opening ceremony is on Friday 19th October 8.30 am. Apart from the business meetings there will be three optional tours for accompanying persons or indeed "active persons" at a small additional cost. On 19th October - Dubai City Tour "Taste of Dubai" On 20th October - Dubai Shopping Tour On 21st October - Cultural Tour On the 18th of October there will be golf at the Arabian Ranches Golf Course. Extra charge of US$196.00 Whetted your appetite? For an updated list of participants at the congress please go to website http://www.fiata2007.ae (weekly update) P.S. Dubai has a sub tropical arid climate. AEP II We invite readers of our newsletter to comment on their experience of the introduction of the new system. A meeting of the Customs Consultative Committee has been arranged for September. Your comments would be appreciated by close of business on Friday next 24th of August to iifa@eircom.net 2 Port Congestion Congestion will continue to grow as a problem and by all current appearances will become more painful a long time before that other fear - global warming - causes dramatic changes to the way we manage our affairs. At the recent Coastlink annual two-day conference in Dublin the "Dublin Declaration" was drawn up which called for a cohesive and inclusive European strategy to address this issue in European ports. It also raised the question of the role that regional ports can play. The Director of the Irish Maritime Development Office, Glenn Murphy highlighted the dependency of this country on major European ports both for access to EU markets and as transhipment points for its deep sea trade. He quoted statistics: "In 2006 we estimate that E130bn of goods were transported via our ports and shipping services". He went on to say that this figure represented over 90% of all traded goods travelling "in and out of our country by sea". "Over 64% of our trade last year was intra European and European ports are major transhipment points for Irish trades to the wider global economy". It is hardly necessary to point out that the causes and the cures may not all lie with the major European ports. Perhaps an equally critical look could be cast on our own local ports in Ireland with a view to improving the total process of moving boxes through them? If you have any comments to make on this please email us at iifa@eircom.net CLECAT focuses on green issues European forwarding association CLECAT recently established a working group on sustainable logistics to reflect the growing importance of environmental issues and their economic impact on the transport sector. The group will tackle all issues related to sustainability in logistics, with a special focus on environmental EU legislation. The members met for the first time on 5th July in Brussels and elected Erica Kronhoffer from Green Cargo as chairperson. The first meeting concluded that this group could play a significant role in addressing sustainability in logistics from the uniquely independent perspective of non-asset based service providers. It will review pro-actively the environmental impact of EU legislation. Quinn Direct in Germany According to a report in Lloyds List Quinn Direct is about to open an office in Frankfurt with offerings including marine. Quinn will offer liability and property cover and is following in the footsteps of firms such as Mitsui Sumitomo of Japan, QBE of Australia and Mapfre of Spain who have set up in business in Germany since the beginning of this year. For the past three years the German market has been extremely lucrative. Quinn is particularly interested in the construction industry, cement, glass and plastics factories, hotels and the hospitality sector according to Fred Slikker the head of European operations for the company. The company is aiming only for business clients on the continent. In the UK and Ireland it is mainly active in private client business. 3 Belfast reclaims land The port of Belfast announced plans to reclaim 48ha of land from Belfast Lough at a cost of £630m (US$1.18bn). The decision was taken on the basis of a report which predicts that Northern Ireland traffic will double over the near future and the terminals, quays, warehouses and roads need to be in place to handle that growth. Another Jack in the Box There was a report in the IFW last month of a Kenyan man who was discovered loaded into a box being readied for export to Kenya's Eldoret International Airport at Dubai International Airport. The former Dnata employee apparently planned to utilise a scheduled weekly charter freighter operated by Emirates to get home. He had packed himself into a small wooden box with some food, water and an oxygen bottle, to help him breathe at high altitude. (We hope some of the budget airlines don't hear of this!) However he did not leave the ground because as the shipment was being palletized, staff heard loud banging inside the crate and the unorthodox traveller was handed over to customs. The Sales and Service agent involved Air Cargo Trader (ACT) was still awaiting the results of a police investigation. It denies any prior knowledge of the stowaway, although some of its staff have been detained by Dubai police. New Eucon Service As from July 18th Eucon Shipping and Transport opened a new route between Dunkirk and Dublin. Carrying a wide range of containers including 20'Dry, 40' HCPW (High cube Pallet Width), 45' HCPW, 20'Flat and 40'flat. This is a weekly service. Calls Dunkirk: Wednesday morning Dublin: Friday morning Who will control Irish Continental Group? The situation as to who will control Irish Continental Group has still not been decided. On Friday 17th August the independent directors gave more time to the competing sides and were due to make a further statement on the matter on Monday 20th August. Two parties are bidding to take over the company - Eamonn Rothwell, the ICG chief executive's group Aella and the partnership of One51 and Doyle Shipping - Moonduster. Both have offered E22.00 per share for ICG and because each indicated to the independent directors that they would not support the other's bid there is stalemate. An hour before the deadline for final offers - set on August 3rd for Friday 17th August - millionaire developer Liam Carroll told the market had increased his stake from 18.6% to 19.06%. According to reports he is unlikely to table a bid as his interest is in the group's property portfolio. After the deadline passed on Friday 17th another window of opportunity for the sides to reach agreement was offered by the independent directors. On Monday, 20th August, 2007, Aella made an offer of E24.00 per share. The independent directors have recommended this improved offer. Under the terms of the offer, any new bid for ICG will have to be more than E25.50 per share to receive the backing of the independent directors. 4 Pentagon Payments The Irish Times of the 18th August reported on a case involving a Pentagon contractor who over-charged for shipping items to key military installations, including Iraq and Afghanistan. A South Carolina defence contractor has pleaded guilty to defrauding the Pentagon of $20.5 million over almost 10 years by adding hundreds of thousands of dollars to the cost of shipping spare parts such as metal washers and lamps. According to court records C&D supplied small hardware components, plumbing fixtures and electronic equipment to the military. The company used a government system that fast-tracked items to priority military installations. C&D submitted the shipping costs separately and the system paid them automatically. In one instance, in 2006, the government paid C&D Distribution $999,798 for shipping two washers valued at only 19 cents. The Pentagon paid 112 of the fraudulent invoices until the scheme was detected last September. A Pentagon spokesman said that steps have been taken to improve internal controls. Also among the Invoices was a 2004 order for a single $8.75 elbow pipe that was shipped for a total of $445,640. Also in the same year, a $10.99 machine thread plug was charged out at $492,096for shipping. Last year six machine screws worth a total of $59.94, shipping costs to the tune of $403,436 were invoiced. A co-owner of C&D Distributors Ms Charlene Corley (47) acknowledged her role in the fraud but maintained her twin sister, who was also a co-owner of the business was the main benefactor who used the money to buy luxury homes, cars, plastic surgery and jewellery. The court heard that her sister took her own life last October after being approached by federal investigators. Real Estate - Savills Hamilton Osborne King Summer Report (edited) According to his summer report on Industrial real estate developments, Gavin Butler, Associate, of Savills Hamilton Osborne King comments that since the beginning of this year in North Dublin there has been a burst of new activity, where construction of new units is well under way at Northwest Business Park and Premier Business Park in Ballycoolin, North City Business Park in Finglas, Airside Enterprise Centre in Swords and the Port Tunnel Business Park in Clonshaugh. The major part of speculative construction at these schemes has been for starter/enterprise units ranging from 200 sq.m to 500 sq.m. in size. Most of the larger buildings under construction are not being built speculatively but are being built to the specific requirements of occupiers as bespoke facilities. Over the last six months sales of approx. E25 million have been agreed with occupiers on a design and build basis at Northwest Business Park resulting in a total of over 15,000 sq.m. currently under construction. The strongest prices achieved this year for new buildings of between 1,500 - 3,000 sq.m in the greater Dublin area was at North City Business Park where approx. E2,260 per sq.m. was achieved. Record prices of up to E3,175 per sq.m have been achieved for smaller units of between 200 - 500 sq.m at Airside Enterprise Centre in Swords. New developments to come on the market on the south side of Dublin over the past six months include Kingswood Park at the Kingswood/N7 junction and a new starter unit development at Grants Avenue in Greenogue Business Park just off the N7 near Newcastle. Prices of approx. E2,315 per sq.m have been achieved for starter/enterprise units in this locality. In September, construction is due to start at Profile Park, a new commercial development of approx. 40 hectares situated beside Grangecastle on the Nangor Road in Dublin 22. Profile Park will be the first major new commercial development on the Naas road in over ten years. Almost half the land will be developed for industrial purposes and the first buildings are due for completion in early 2008. 5 Vacancy Rate The first six months of this year has seen the vacancy rate move back over the 10% mark. In December 2006 the rate had fallen below 10% for the first time this decade. The increase is due to a number of medium to large sized facilities which have come to the market recently. These include the Whelan facilities in Dublin 12 and Dublin 15 and two facilities occupied by Tesco and Fedex in Ballycoolin. These alone account for over 30,000 sq.m of space. Industrial land values are likely to grow by between 5-10% with building values rising by another 5% before the end of the year, according to the report. Development Land Market In an interesting comment the report says "property development in Ireland, has become far more sophisticated in recent years with the emergence of stronger planning policies from local authorities and more discerning buyers for the end product. The emergence of Framework Plans, Master Plans and Action Area Plans has greatly assisted developers in ascertaining the true potential of lands, while also delivering sustainable developments. Developments such as Adamstown, where the provision of both physical and social infrastructure have been paramount are likely to become far more commonplace. On the negative side, the preparation of such plans can add considerably to the timescale for development but as the process becomes more streamlined, this should become less of an issue" Savills website - http://www.savills.ie Cargo 2000 pioneer dies Mr. Ron Cesana project director of the Cargo 2000 airfreight quality programme died on 8th June while on holiday in his home country Italy. Ron was 66. Some members may remember Ron when he spoke at a lunch the association had in Cruzzos restaurant in Malahide a few short years ago. At extremely short notice he acceded to our request to address us at that time. Ron had a long and distinguished career with AEI before taking on the challenge of Cargo 2000. Ron was most recently in the process of developing proposals for small and medium-sized forwarders that have previously lacked the technical infrastructure to join Cargo 2000. Mick Fountain, the chairman of Cargo 2000 initiative underscored Cesana's great merits for the airfreight industry and assured the industry that the next development steps for Cargo 2000 will be realised with the same commitment as Ron had envisaged. Alan Hines RIP All of his friends and acquaintances will be sad to hear of the untimely death of Harry Hines’ son, Alan, aged 36. Alan, who is survived by his wife and daughter, was laid to rest in St. Fintan’s Graveyard in Sutton on Monday, 13th August, 2007. 6 Aer Lingus Routes from Belfast International Airport (BFS) Following the announcement of a new base in Belfast, Aer Lingus also announced full details of the schedule and routes that will operate. In all the debate about its effect on Shannon, the extent of the services that will be on offer has not been so apparent. The routes that will be served, their dates of commencement and their weekly frequencies are: Destination Amsterdam Barcelona Geneva London Heathrow Rome Budapest Malaga Faro Weekly 14 5 2 21 4 3 4 3 Starts December 10th ditto ditto Jan 14th Feb 25th ditto ditto ditto World Trade and the Doha Round - Last Ditch Since its beginning in Doha in November 2001 and the failure in Cancun in 2003 the World Trade Organisation's Doha round of talks has been painful. It suffered another setback in Potsdam in June when the G4 countries failed to reach agreement. A meeting of minds in Potsdam would have brought a more positive atmosphere. Ministers from the 21 members Asia-Pacific Economic Cooperation (which excludes the EU, India and Brazil) met in Cairns, Australia in July this year and urged the opposing parties to show flexibility and offered to mediate between the factions. Overall failure of the Doha round will mean the removal of the possibility of 150 countries lowering barriers to global trade in goods and services worth more than $14 trillion per year. A successful outcome will boost global commercial trade, including increased shipments of millions of tons of grains, cotton, meat products and industrial goods from steel to machinery, textile and clothing. The Doha agenda is designed to lift millions of people out of poverty but has stalled over a failure to make deals on rice, poultry, bananas and manufactured goods. In 2006 global merchandise trade was valued at $11.7 trillion, of which manufactured goods accounted for about 70%, while mined fuels and agriculture products accounted for about 8%. Other fuels, minerals, ores and metals accounted for the remainder. The Doha round, launched in the Qatari capital has involved numerous other negotiations, including trade in services, trade and environment, anti-dumping, fishery subsidies, specific development issues, trade related intellectual property and trade facilitation. Since the round was launched, member governments have, among other things, already agreed to eliminate all forms of export subsidies in agriculture, to remove barriers to trade on 97% of least developed country exports, to reduce the highest agriculture and manufacturing tariffs by the widest margins and to reduce red tape and bureaucratic delay in customs procedures. Among the differences still needing resolution in the agriculture and 7 NAMA negotiations is the precise magnitude of tariff cuts, and reductions in trade distorting domestic farm subsidies and the degree of flexibility to be extended to developing countries in opening their markets to greater competition from imports. In an effort to try and bridge gaps it was hoped that the G4 group might smooth matters over. However, in June, the trade and agriculture ministers of the group - US, European Union, Brazil and India- failed to bridge those gaps when they met in Potsdam in June. The G4 had been holding talks parallel to the WTO multilateral discussions all along, and after Potsdam that group has now thrown in the towel and it is now back in the WTO court. The hope is now that the WTO and its chief Pascal Lamy will be able to pull all the collective 'cochones' out of the fire in talks that are due to begin on September 3rd. Blueprint Overseeing the Doha round talks respectively on agriculture and industrial market access, the New Zealand and Canadian chairmen have come up with a draft blueprint which is a lifeline to world trade diplomats that hopefully will get the talks back on track. The proposals put forward by Crawford Falconer, the New Zealand chairman of agriculture negotiations and Don Stephenson the Canadian chairman of industrial market access talks have met with a mixed reaction. Don Stephenson's text concerning industrial market access - NAMA (non agricultural market access negotiations) suggests that the final rate of duty for rich nations at the end of the Doha Round should be around 8% - 9% and for developing countries between 19% and 23%. It also suggests that tariff cuts for manufactures be implemented over four years for rich nations and over eight years for developing nations. In talks to date the rich countries have pushed for the final rate to be around 10% for developed nations and 15% for developing nations. The WTO director-general and former EU Trade Commissioner Pascal Lamy defended the proposed texts as being representative of members' views that offer " a fair and reasonable basis for reaching ambitious balanced agreements." Commenting on the mixed reactions to-date he said "what separates (them) to-day, is smaller than what unites them". For information - http://www.wto.org Irish Ferries' new ship Irish Ferries' new ship on the Rosslare, Cherbourg and Roscoff route is to be named "Oscar Wilde". It will continue to operate under charter to Color Line, who sold the vessel to ICG, on the Oslo to Kiel route until Irish Ferries takes delivery in September. Built in Turku in 1987, the 31,914 gt ship will carry up to 1,458 passengers and 580 cars. This is a 40% capacity increase compared to the "Normandy" which currently plies the Rosslare/Roscoff route. It will be able to carry more vehicles (62 versus the current 43). Cars will be carried on a separate deck from the freight deck. The ship will have a speed of 21.5 knots, cutting one hour off current cruising times. Other vessels in the fleet have literary links, "Ulysses" and "Jonathan Swift". 8 Piracy Plague The International Maritime Organisation has made a formal approach to the United Nations Security Council for a naval task force to police the Somali coast. This follows a recent upsurge, which has seen two food aid ships hijacked offshore. A former senior UN official, according to a report in Lloyd’s List, has said the attacks are preventing ships from delivering food supplies to hundreds of thousands of Somali civilians caught up in hostilities or affected by drought and in dire need of humanitarian relief supplies. The executive director of the World Food Programme, Josette Sheeran has also pleaded for the world to act. The appeal by WFP came following the killing of a Somali guard who helped to repulse a pirate attack on a ship that had just delivered food to the Somali port of Merka. "For us it's very important to be able to buy food and have it delivered by ship, because it is much cheaper" said WFP spokeswoman, Christiane Berthiaume. and the last word....... "An idealist believes that the short run doesn’t count. A cynic believes that the long run doesn’t matter. A realist believes that what is done or left undone in the short run, determines the long run" Sidney J. Harris (1917 -1986) American journalist and author 9