EN Official Journal of the European Union C 157/141

Opinion of the European Economic and Social Committee on ‘Europe's accessibility by sea in the future: developments and how to anticipate them’

(2005/C 157/25)

On 1 July 2004 the European Economic and Social Committee, acting under Rule 29(2) of its Rules of Procedure, decided to draw up an opinion on: ‘Europe's accessibility by sea in the future: developments and how to anticipate them’.

The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 24 November 2004. The rapporteur was Mr Simons.

At its 413th plenary session on 15 and 16 December 2004 (meeting of 16 December 2004), the European Economic and Social Committee adopted the following opinion by 124 votes in favour, with two abstentions:

1. Introduction

1.1 Maritime transport to, from and between the countries of the European Union is of cardinal importance. Each year more than 3,500 million tonnes of cargo are imported and exported via the more than 1,000 seaports of the EU. In addition, about 350 million passengers travel annually by ferry and cruise ship.

1.2 More than 90 % of Europe's trade with the rest of the world is routed via its seaports. Moreover, 40 % of goods transported within Europe are likewise conveyed by sea. From the energy and environmental points of view, maritime transport is rated highly. Compared with road transport it can be 13 times less polluting as far as CO2 and particle emissions are concerned and even 19 times less so with regard to CHx (1).

1.3 Around 250,000 people are employed in the ports of Europe or in the directly related services sector. The entire maritime sector provides work for about 2.5 million people in Europe and generates approximately 111 billion euros in added value. The importance of maritime transport for Europe should therefore be obvious.

1.4 The volume of maritime transport in, from and to Europe continues to grow each year. It is consequently of great importance that the EU should keep a close eye on the growth of these maritime flows and encourage — or where necessary itself take — appropriate measures at an early stage in order to be able to manage the growth.

1.5 Maritime transport can be divided into different types and categories, depending on: the purpose of the voyage (leisure or commercial); how it is organised (tramp or liner shipping); whether deep sea or short sea shipping; and the type of load (passenger or goods transport). Commercial transport and the four categories mentioned above have a particular impact on the single market and are the subject of this opinion.

1.6 In passenger transport, the most obvious difference is between cruise ships and ferries/ roll- on/roll -off services. The transport of goods by sea can be sub-divided depending on type of load: — Dry bulk cargo. Carried as bulk cargo in special bulk carriers, e.g. ore, coal and grain. — Liquid bulk cargo. Transported in tankers, e.g. crude oil, oil products and chemicals. — Mixed cargo. Divided into roll- on/roll -off cargo, other mixed cargo and containers.

2. Outline of the market situation in the relevant categories

2.1 Cruise and ferry roll -on/roll- off shipping are two radically different types of passenger transport. Cruising is a kind of tourism by ship. Ferries, on the other hand, provide transport from A to B and, as roll- on/roll- off services, may also be used to transport goods. A total of 350 million passengers travel by sea in the EU, including some 4 million by cruise ship.

2.2 The biggest European cruise ports are, Barcelona (832,000 passengers), Palma de Majorca (665,000), Venice (634,000), Naples (534,000) Southampton (533,000) and Civitavecchia (520,000). The biggest cruise ship is the Queen Mary 2, launched this year, which is 345 metres long and 41 metres broad, and has a 10.3 metre draught. The Queen Mary 2 is about as long as the biggest bulk carriers and container ships. However, cruise ships have more restricted draught than container and bulk ships. Larger ports have no real trouble in providing access for the small number of ships involved.

2.3 Ferries usually also provide roll- on/roll- off goods transport and are combined passenger-cargo ships. In the EU, ferries link the European mainland and the UK, Ireland, Scandinavia, the Baltic States and the Canary Islands, and the Mediterranean in particular has an extensive ferry network including destinations outside the EU. The biggest ferry/roll- on/roll-off ships are the Pride of Rotterdam and the Pride of Hull — sister ships of the P&O North Sea Ferries fleet. These ships are 215 metres long, 32 metres wide, but their draught is only 6.3 metres.

2.4 Apart from occasional local difficulties, physical access to Europe by vessels of this category does not, for the moment, require any further structural consideration at European level. These categories are thus already assured future European access, which enables further growth in this sector as well.

2.5 Dry and liquid bulk cargoes are of great importance for supplying European industries. Dry and liquid bulk transport in Europe experienced, especially in the 1960s and 1970s, a period of enormous growth in terms of expansion in load volumes and size of ship.

2.6 In the case of liquid bulk cargo, the closure of the Suez Canal following the Six-Day War and the continued growth in demand for crude oil resulted in an increase in maximum ship size from 85,000 DWT in 1968 to 560,000 DWT (2) in 1976. A number of European ports took steps to allow such ships to dock there. Once the first oil crisis struck in 1973, these ships ceased to be profitable and, ultimately, they were scrapped. The new-build tankers of the 1980s and 1990s did not continue the trend for bigger and bigger ships. The size of large tankers is stable at around 300,000 DWT. Not until 2002 were, once more, a few 400,000 DWT Ultra Large Crude Carriers (ULCCs) built; there is still adequate port capacity to cater for them.

2.7 Dry bulk cargo transport experienced a similar development from the late 1960s onwards. Ships in this category grew in size, culminating in the 365,000 DWT Berge Stahl, which has been transporting iron ore from Brazil to Rotterdam for the past eighteen years and which, with its 23 metre (76 foot) draught, has no access anywhere else in the world. Since the 1980s, however, the vast majority of new bulk carriers have been between 150,000 and 175,000 DWT. Dry and liquid bulk transport operations have thus become fully developed markets and the European seaports they use have already adapted — even to the biggest dry bulk cargo ship in the world. No further significant expansion in loads or size of ship is now to be expected. These categories are thus also already assured future European access.

2.8 Mixed cargo is transported in general cargo and multi-purpose ships. Since the rise of the container, the mixed cargo market has declined steeply and is limited to niche markets such as Africa and reefers in the specialised fruit trade. The ships are restricted to around 40,000 DWT and ship size is no longer increasing.

2.9 Container transport, on the other hand, is currently undergoing a period of unprecedented structural growth, in terms of both volume and ship size. In 1966, the Fairland was the first ship to transport intercontinental containers from the US to Europe. The Fairland — part of the Sea-Land fleet — was able to transport 266 35-foot containers. Today, with a capacity of 8,500 TEU (twenty-foot equivalent units), the CSCL Europe is the biggest container ship in the world;, although 9,200-TEU ships are already under construction. The CSCL Europe is 334 metres long and 42.8 metres broad and has a maximum draught of 14.5 metres. The following graph shows the biggest container ship built in the year in question. The spectacular growth — particularly since 1995 — is astounding. At the moment, orders have been placed for 156 ships with a capacity of more than 7,000 TEU.

2.10 Shipyard orders are expected soon for 10,000-TEU and even as much as 12,000-TEU ships, which would still require only a single engine. Calculations have even been made (3) as to the potential upper limit. Because of the rock formations in the Malacca straits — a vital part of the Asia trade route — a figure of 18,000 TEU has been arrived at, although the vessels in question would be double-engined, significantly raising the transport price per container. Intercontinental container ships will therefore not necessarily grow to maximum technical and geographical capacity, as has been seen during the last few decades in the case of intercontinental transport by ship of dry and liquid bulk goods.

2.11 Transport of intercontinental containers to and from European ports has grown particularly fast over the last few years. One consequence of the increasing globalisation and associated rise of China as a producer country is that the north-west European container ports of the Hamburg — Le Havre range have experienced structural growth of more than 10 % per year over the past few years. Mediterranean ports have also expanded very fast.

2.12 Big container ships, for instance from the Far East, only call at a limited number of European ports. On the one hand, this is because they are too big for many ports and, on the other, because these ships are so expensive that they do not want to waste too much time in port. In Europe, the biggest ships generally call at two or three Mediterranean ports and around four in the north west of the continent. The containers are then dispatched from these large container ports across Europe — by sea, using an extensive feeder network, or overland, increasingly by rail or inland waterway.

2.13 However, in the main European container ports (4) at any rate, congestion is increasingly becoming an issue in the handling of these growing container flows in port terminals and in subsequent transit. In addition to terminal-based measures to remedy this in the port itself (including expansion), efficient pre- and post-transport procedures are also needed, both at sea and on land.

2.14 The new security requirements are also a major concern for container ports, in terms of keeping the transhipment and transport process as smooth as possible despite the increase in checks.

2.15 Given the increase in size described in points 2.9 and 2.10 above, deep sea container flows will not spread to other European harbours via the shipping market. This is largely due to physical features such as insufficient draught, inadequate facilities, excessive travelling times and insufficient load to make the extra port call economically viable (5). This is, nevertheless, not a permanent state of affairs, as economic dynamics can provide a boost for smaller harbours towards more activity.

3. Links to fore- and hinterland

3.1 Most containers shipped into European ports must be moved out of them again for onward transportation. Some are forwarded by sea in small vessels to other ports. The majority enter the European hinterland by road, inland waterway or railway. This means that the capacity of hinterland connections must keep pace with the growth in container traffic. While not ruling out road transport where necessary, everything possible must be done, in line with EU policy, to encourage the use of inland waterways, railways and short sea/feeder ships.

3.2 Intra-European short sea transport in particular therefore receives strong support from the EU. As part of the new trans-European transport networks, this also includes the Motorways of the Sea programme that still requires further fleshing-out. More particularly, according to new proposals (16/7/2004) the TEN-T budget would amount to EUR 20.35 billion, whilst the MARCO POLO II Programme would include motorways of the sea and traffic avoidance measures with a budget up to EUR 740 million.

3.3 The concept of ‘Motorways of the Sea’ (MotS) has been developed by the European Commission as a supplement to other modalities that are being supported within the trans-European network programme. A MotS provides a strong alternative to road traffic within Europe on an equal basis, eliminating unnecessary procedures and allowing for efficient inter-modal connections. The programme is focused on limiting congestion on the European transit routes and on connecting remote regions and island states.

3.4 In order to promote short sea shipping itself, improvements can be made in ports and in inter-port collaboration. The key to success is high frequency of services and thus high volume. Market potential and commercial exploration are therefore important for the viability of short-sea shipping connections.

3.5 Internal transport within the EU also requires a great deal of attention. This is already clear from European transport policy — which, in this context, also includes the appropriate infrastructure — as it strives to boost efficiency and effectiveness by establishing, within certain parameters, a free market that also reflects other social values such as sustainability.

3.6 To achieve that, appropriate rules are already in place — and are being applied — in the road transport and inland waterway sectors, and the process is now at last also starting to get under way across the entire European rail network. Speedier progress on this front would be welcome, not least given the container trends described above.

4. Categories of port

4.1 In the EU decision-making process (6), a distinction is made between three categories of TEN ports only: a: international seaports with an annual transhipment volume of no less than 1.5 million tonnes or 200,000 passengers; b: seaports with an annual transhipment volume of no less than 0.5 million tonnes or between 100,000 and 199,000 passengers and equipped with installations for short sea traffic; c: regional seaports not fulfilling criteria A and B and situated on islands or in peripheral regions.

4.2 So far, this distinction has not resulted in any substantively different approaches being adopted. Indeed, the revamped TEN transport priority list makes no mention of ports, even in connection with the Motorways of the Sea priority. With some exceptions, there is, for the time being, no support among either the authorities or industry for the use of more detailed criteria when selecting ports for specific EU co-financing of the massive investments required by deep sea container ports — largely for transit cargo that adds relatively little to the value of the ports themselves. The EESC supports recent calls from the Conference of Peripheral Maritime Regions of Europe (20/7/2004) to balance the notions of Motorways of the Sea and accessibility by taking into account small and medium-sized ports as well in this exercise.

4.3 In the light of the above, the EESC strongly urges the Commission to investigate the problem of congestion in EU ports and particularly container ports and explore possible ways to facilitate it.

4.4 Nonetheless, sustained growth is presenting a number of particular challenges to Europe's larger container ports (7) which are distributed fairly evenly over the Mediterranean and the north-west of the continent. These include both really large and medium-sized ports and they are, for the most part, not merely container ports, but often also important ports for the transhipment of bulk and other mixed cargo. These challenges are as follows: — How soon can additional transhipment facilities be built, on both sea and land, while meeting the current stringent rules with respect to noise, the environment and external security? — How can ports adapt their accessibility by sea, the depth of quays and size of transhipment equipment to accommodate the upcoming increase in 8,000+-TEU ships? — How can it be ensured that connections between a port and its European hinterland have sufficient capacity to manage the increasing flow of container traffic? — How can logistical processes in ports be kept as flexible as possible with increasing security checks?

4.5 In order to stay competitive on the world stage- one of the objectives of the Lisbon agenda- it is in Europe's interest that the ports in question really do take appropriate steps to tackle and resolve these challenges. The European Union should also seek to exert its influence on that front wherever possible.

4.6 Ports, and in particular those alluded to in this point, are also waterways to the EU, which has security implications. The EESC recalls its earlier opinions asking the European Commission to draw up an overall impact study on the cost of security for ports and to devise an EU scheme for their financing.

4.7 Extra attention for the big container ports is not inconsistent with the promotion of short-sea routes and the Motorway of the Sea concept. Precisely the major container ports serving the deep sea routes are, in many cases, also the leading short sea ports. What is more, these ports possess the necessary volume, infrastructure and hinterland to be able to generate sufficient cargo and thus, thanks to the Motorways of the Sea, to help the other short sea ports grow.

5. Practical EU action

5.1 Steps must be taken to ensure that the effectiveness and optimum impact of the major investments now being made — or shortly to be made — by larger container ports to tackle and resolve the challenges outlined in point 4.3 above are not compromised by distortions of competition, poor infrastructure or inefficient transport policy. Given the close connection between container ports and short sea shipping via the feeder lines, Motorways of the Sea and hinterland links, such an approach has far-reaching consequences and benefits the entire transport market.

5.2 First and foremost, therefore, the EU should also ensure that a sound environment is in place for fair competition, or what is also called a ‘level playing field’. Ports — by which we specifically mean the economic players of ports — must be able to compete with each other on a fair basis; this also applies to competition both within and between seaports.

5.3 In the light of the experience of the other goods transport sectors that have already taken steps in that direction, some degree of liberalisation in the seaport market would be beneficial and a good way to make the best possible use of the available options. At the very end of its term of office, the outgoing Commission, acting on a proposal of transport commissioner Ms de Palacio, submitted to the Council a new directive on access to the port services market. That will again (8) give the Committee the opportunity to issue a detailed opinion. Hence, this issue is not addressed in the present opinion.

5.4 There must be much more clarity about what is and what is not permissible, especially in the field of state aid. For instance, to what extent may a seaport's infrastructure — which is directly related to the increasing size of ships — be subsidised by the authorities? National governments and port managers need to know what the situation is. We urgently need clear guidelines on state aid. The EESC takes note of the Commission's intention to produce guidelines on state aid to ports and urges it to do so speedily irrespective of adoption of the proposed new Directive on ports.

5.5 Enforcement and implementation of the rules also require close attention. There is wide scope for interpretation in transposing EU legislation into national law. The EU should be much more careful to ensure uniform implementation of EU rules. This can also be seen with the enforcement of existing EU rules and regulations, which is patchy and inconsistent. There are clear differences of interpretation between the Member States as regards legislation on the environment, nature and safety. Competition between ports on these essential areas is not desirable.

5.6 To shed more light on how seaports are financed, their accounts must be transparent, especially when it comes to money flows from and to government (local, regional and national). The EU must also develop effective instruments to ensure this. In its 2001 opinion (9), the Committee expressed its firm belief that, in conjunction with the Treaty articles on competition and state aid, and the relevant European Court of Justice case law, applying the ‘transparency’ directive to all TEN ports is enough to provide the Commission with effective means of intervention. So far, there has been no practical follow-up to that statement.

6. Summary and conclusions

6.1 The volume of maritime transport in, from and to Europe continues to grow each year. Given the major importance of this transport sector for the EU, the Union should keep a close eye on the growth of these maritime flows and encourage — or where necessary itself take — appropriate measures at an early stage in order to be able to manage the growth.

6.2 Maritime transport can be divided into different types and categories, depending on: the purpose of the voyage (leisure or commercial); whether deep sea or short sea shipping; and the type of load (passenger or goods transport). These categories — and commercial transport — have a particular impact on the single market and are the subject of this opinion.

6.3 EU passenger transport by sea is a very sizeable sector, with passenger figures running at 350 million. However, given trends in growth and ship size, the EU need not concern itself further with infrastructure in this sector, as opposed actual growth trends. That said, key consideration must be given to passenger security, especially on cruise ships.

6.4 Dry and liquid bulk transport in Europe also experienced a period of enormous growth in the 1960s and 1970s and appropriate measures were taken at the time to adapt ports to larger ships. These markets are now fully developed. Conventional mixed cargoes are clearly in decline. Roll- on/roll- off services are sometimes provided in conjunction with ferries and also represent an important, fully developed market.

6.5 Container transport, on the other hand, is currently experiencing unprecedented structural growth both in scale and in ship size.

6.6 Congestion is increasingly becoming an issue in the handling of these growing container flows in port terminals and in subsequent transit. In addition to terminal-based measures to remedy this in the port itself (including expansion), efficient pre- and post-transport procedures are also needed, both at sea and on land.

6.7 Given the increase in size, deep-sea container flows will not necessarily spread to other European harbours via the shipping market. This does not, however, mean that the economic background is not conducive to the growth of smaller ports.

6.8 In light of the above, the EESC strongly urges the Commission to investigate the problem of congestion in EU ports, and particularly container ports, and explore possible ways to facilitate it over and above what is actually being done in the TENs.

6.9 Having already been successfully achieved in the road transport, inland waterway and shipping sectors, steps are at last also starting to be taken to boost the efficiency and effectiveness of the entire European rail network. Speedier progress on this front would be very welcome.

6.10 In order to stay competitive on the world stage, it is in Europe's interest that the larger container ports really do take appropriate steps to tackle and resolve the challenges they face. The European Union too should seek to exert its influence on that front wherever possible. No consideration must, however, be given to proposals for any EU financial support mechanisms for ports other than those mechanisms already in place. However warranted such proposals may be in theory, not least for container transport, they do not at the moment enjoy enough support as neither the authorities nor industry want to see any further distinctions being introduced between European ports other than those already in place under the TEN.

6.11 Ports are also waterways to the EU, which has security implications. The EESC recalls its earlier opinions asking the European Commission to draw up an overall impact study on the cost of security for ports and to devise an EU scheme for their financing.

6.12 The European Union is in a position to establish a level playing field for fair competition; promote a certain degree of liberalisation of the seaport market; shed light on state-aid issues by providing clear guidelines; give close consideration to implementing and enforcing the current rules; and secure transparency in money flows.

Brussels, 16 December 2004 The President of the European Economic and Social Committee Anne-Marie SIGMUND

(1) Source: ESPO brochure: Ports creating opportunities - by connecting people, products and business – by connecting Europe.

(2) DWT= Deadweight Tonnage of a ship, that is the load capacity of a ship measured in tonnes. With container ships, the number of TEUs (Twenty Foot Equivalent Units) is used as a unit of capacity. That is the maximum number of containers measured in TEUs that the ship can transport. Since an empty container takes up as much space as a loaded one, DWT is not used with container ships.

(3) Niko Wijnolst et al.: Malacca-Max, The Ultimate Container Carrier, Delft University Press, 1999.

(4) See appendix for a table and map of the key European container ports.

(5) These are, for instance, the reasons why the very largest container ships do not call at ports in the north Adriatic Sea, the northern UK, Ireland and the Baltic Sea. Ultimately, cargo from these areas is transported by these ships by being ‘fed’ to and from ports that can cater for them.

(6) TEN Guidelines (Decision No. 1692/96), incorporating seaports, inland ports and inter-modal terminals into the TEN.

(7) See appendix, also mentioned in footnote 2.

(8) The Committee issued an opinion on the proposal on market access to port services that was submitted in early 2001 and has now been rejected by the European Parliament in its role as co-legislator, TEN 075, rapporteur: Mr Retureau (OJ C 48, 21.2.2002, p. 122).

(9) Reference: see footnote 8