Maritime and Trade Talk - Stirring the Melting Pot
Discussions around the cause for the congestion issue the maritime industry faces are heating up fast. Digitalization and collaboration among the supply chain are two key ingredients of Gene Seroka's recipe to tackle this. The executive director of the Port of Los Angeles and Patrick Verhoeven, managing director of the IAPH, discussed the way forward.
How the shipping industry works with the cargo side and ports is something Gene Seroka, executive director at the Port of Los Angeles, thinks about a lot — especially amid the waterways congestion issues some parts of the world currently face. "What we're witnessing here in the US is a pandemic-induced buying surge by the US consumer that we've never seen before," Seroka told P&H in a conversation with the managing director of the IAPH, Patrick Verhoeven. While people followed stay-at-home orders in the US, commerce plummeted in mid-2020. In Los Angeles, businesses dropped by about 19% in the first five months of 2020, and then started to surge."
It is all connected
The pandemic was just another stressor on the supply chain, Gene added. "Because of ill-advised trade policy in Washington from the previous administration, our exports continued melting pot to plummet. At the Port of Los Angeles, our exports have been down 29 out of the last 33 months."
He therefore cautions against attributing the situation to having a single cause. "When folks try to categorize the industry as having problems based on port congestion, I think instead we need to look at the entire supply chain." He added that, "I think it should be a dialogue within the industry and with elected officials and policy makers as well. There's a lot to be excited about right now, but we've got to categorize this properly to make sure that our voices are heard."
Digital way forward
One of the developments Gene is excited about is advancing the digital infrastructure of the supply chain. "Unfortunately, we are decades behind our colleagues in Europe, Asia, the Middle East," said Gene, adding that he has worked all over the world and witnessed what digitalization means to port communities and supply chain participants.
"Because we have the ability as ports to affect change, we talk to so many people, we have so much access at the C-Suite level in our industry, that ports are a natural repository for all this information and have the ability to advance our industries technological capabilities," he added.
"I very much subscribe to what Gene said that the port authorities are somewhere in the middle of all the action," said IAPH managing director Patrick. Within this melting pot is a small group of trailblazers that play an important role. "Basically, when it comes to data sharing, we have ports around the world that are very advanced like LA and I would also mention ports such as Barcelona, Hamburg, Singapore among others. So, I think to broaden the knowledge from that relatively small group of leading ports and to share that with the wider communities, that's our role as IAPH."
He is echoed by Gene, "It's really about leadership. And whether it be former IAPH president Santiago Garcia-Milà from the Port of Barcelona, Jens Meier from the Hamburg Port Authority, Tang Chong Meng from the PSA, and Ley Hoon Quah from Singapore. These are folks that have that vision, and, for the record, we have done our level best to overcome objections in this area by creating data, sharing agreements, legal documents that permit data sharing within the confines of that mutual respect and leadership."
Looking out for risks
Gene also values being self-sufficient over being regulated. "It's my belief that we have advanced further in our industry with voluntary measures than with the hammer of regulation."
The above article is an excerpt from the cover interview of Ports & Harbors magazine, September/October 2021. Ports & Harbors is the membership publication of the International Association of Ports & Harbors.
Gene Seroka is the executive director of the Port of Los Angeles, the busiest container port in North America. Throughout the pandemic, Seroka - who lived in China during the 2002-2004 SARS epidemic - has led the port's response to the global health crisis, keeping cargo flowing as an essential service to the nation. Seroka has distinguished himself as a leader throughout his 33-year career in shipping, global logistics and executive management. He holds an MBA and Bachelor of Science in Marketing from the University of New Orleans.
Patrick Verhoeven is the managing director of the International Association of Ports and Harbors (IAPH), responsible for policy and strategy. The organisation represents about 170 ports and some 140 port-related businesses in 90 countries worldwide. Prior to joining IAPH in 2017, Patrick spent twenty-four years in Brussels representing the interests of shipowners, port authorities, terminal operators and ship agents at EU level. He started his career in 1991 with the Antwerp-based ship agent Grisar & Velge. Patrick holds a PhD in applied economics and a bachelor's in law from the University of Antwerp.
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This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.
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