Digitalization holds promise

In Global Maritime Issues Monitor 2020, from Global Maritime Forum, broker Marsh and the International Union of Marine Insurance (IUMI), it was noted that the pandemic had shown digitalization to be a shortcoming in the industry.

Some commentators said that digital technologies, had they been better developed prior to the pandemic, could have improved transparency and traceability in disrupted supply chains and reduced the exposure of seafarers to contagion.

The open-ended survey responses indicated that Covid-19 was seen as likely to accelerate digitalization, while 35% of respondents said it had made more likely the development of big data, AI, and autonomy technology.

Alicia Garcia Herrero, Chief Economist Asia Pacific, Natixis, said that “the maritime sector has long been accused of being slow to adapt. But, to live with the virus, the maritime industry should respond quickly to include terms related to new arising issues such as sudden port closures or increased hygiene protocol. In the medium run, the sector should enhance its digital adoptions to meet with the new working mode.”

Herrero added that those more adapted to digital applications and more diversified in supply chain could operate relatively smoothly during pandemic disruptions.

It was possible that the abrupt emergency conditions brought on by the pandemic will also force changes in the onshore maritime workforce similar to what is being seen in other industries.

Heidi Heseltine, CEO, Halcyon Recruitment and Co-Founder, Diversity Study Group, said that “remote working and the adoption of new technology have historically been real challenges for the maritime sector to consider. It took the pandemic for the industry to be left with no other option but to embrace both simultaneously, and almost overnight.”

One area of acceleration stemmed from the need to reduce face-to-face interactions, according to Quah Ley Hoon, CEO of the Maritime and Port Authority of Singapore (MPA). She noted that the MPA had been rolling out technology to use electronic certificates to improve efficiency and port clearance. “The global supply chain thrives on global connectivity,” Quah Ley Hoon said. “There needs to be global collaboration on digitalization in order for the benefits to be multiplied.”

Industry experts agreed that improving the use of technology should be a top agenda item and could lead to benefits in areas such as efficiencies from data optimization — including meteorological data, oceanographic data, shipping rates, and vessel information — improved risk management, improved environmental performance, and more.

Richard Smith-Bingham, Executive Director at Marsh & McLennan Advantage, said that, in order to take advantage of the new opportunities, shipping companies would need to enter into new technology-based partnerships. Without those, the industry could be open to disruption from major technology firms, particularly e-commerce and transportation firms with existing capabilities in the application of data for transportation and land-based supply chains.

Respondents continued to see autonomy technology as something for which the industry was particularly ill-prepared. It moved from fourth on the list of unpreparedness to third this year, just after pandemics and global economic crisis. Smith-Bingham said that “the opportunity of (more) autonomous shipping raises considerable questions about the consequences for seafaring staff, given crew costs and the space required for them. Although a high proportion of marine accidents can be ascribed to human error, greater use of autonomous technologies presents a host of unresolved legal liability questions as well as those relating to confidence in absolute reliability.”