Spotlight 2: Maritime Security

Spotlight 2: Maritime Security

Securing maritime cargo globally throughout the entire supply chain remains a security challenge for shipping lines, vessel owners, and shippers. In 2007 and 2008, the issue of piracy and hijacking of ocean vessels on the high seas became a major concern, particularly for vessels passing through the Gulf of Aden on the east coast of Africa. In 2008, more than 120 pirate attacks occurred in the Gulf of Aden (New York Times 2009). On April 8, 2009, a U.S.-flagged container vessel with 20 American sailors was hijacked by pirates off the coast of Somalia. The vessel's crew later regained control of the ship. The International Maritime Bureau estimates that between January and April 2009, there were 41 attempted pirate attacks and 6 hijackings in Gulf of Aden (ICC Commercial Crime Services 2009). Preventing such attacks in the vast open oceans is an enormous challenge for the international maritime community.

The security of U.S. ports and the goods that pass through them depends on numerous governmental actors, foreign and domestic, and private-sector entities. Following the terrorist attacks of September 11, 2001, attention to maritime trade security increased substantially. Legislation and related government strategies have proliferated, but significant concerns remain about the overall security of maritime trade.

Several long-term trends in maritime trade have made it more difficult for U.S. authorities to secure maritime cargo. In the second half of the 20th century, globalization transformed the nation's economy. The production of many goods moved to low-cost locations overseas, necessitating an increase in maritime trade. Containerization, the use of large aluminum or steel containers to ship freight, aided globalization by reducing the amount of time and labor needed to ship goods and by reducing cargo damage (OECD 2003). The trend toward just-in-time (JIT) production and inventory management, in which firms seek to cut costs and improve efficiencies through a build-to-order strategy that dramatically reduces their inventories, has provided many benefits to shippers, but it has also presented complex security challenges.13

Because containers make up the largest percentage of inbound maritime cargo traffic, they have been the focus of security efforts. Containers obscure cargo from plain sight. Because of the high volume of imported containers handled at U.S. seaports, it is a challenge to attempt to inspect every container without severely interrupting the flow of trade. Containers, and the items they transport, often take circuitous routes from origin to destination, not only passing port to port but traveling inland via rail or truck. An average container makes 17 stops between its origin and final destination. Tampering with containers-inserting illicit material-is not difficult at most points in the supply chain (Cohen 2006).

U.S. authorities have taken a multilayered approach that attempts to provide maritime freight security throughout the international supply chain. This section reviews the current maritime security system and the difficult challenges the United States faces in providing a completely secured maritime transportation system.

Post-9/11 Security Improvements

The September 11, 2001, terrorist attacks dramatically increased public-sector attention to maritime transportation system security. In fiscal year 2001, federal funding for port security was approximately $259 million. By fiscal year 2005, it had risen to $1.6 billion, a 700 percent increase (USDHS CBP 2006).

Table 8 summarizes some of the significant maritime security legislation in the post- 9/11 period. The Maritime Transportation Security Act of 2002 (MTSA) and the Security and Accountability for Every Port Act of 2006 (SAFE Port Act) are among the most important pieces of legislation. Out of MTSA, the National Maritime Transportation Security Plan was created to provide a framework for deterrence of security incidents involving maritime transportation infrastructure and for response to any that may arise. This plan requires two levels of security planning at the local level, the Area Maritime Security Plans (AMSP) and the Vessel and Facility Security Plans (VSPs and FSPs, respectively). AMSPs are developed by the local U.S. Coast Guard sector commander/federal maritime security coordinator, with input from the area maritime security committees, which include government officials and other key stakeholders. Facility owners or vessel owners or operators create VSPs and FSPs. There are eight additional mode-specific security plans that are subsidiaries of the National Maritime Transportation Security Plan.

Under the SAFE Port Act, the Draft Strategy to Enhance International Supply Chain Security was produced in July 2007.14 The U.S. Department of Homeland Security (USDHS) is the lead agency in implementing this strategy. It provides an overarching framework to facilitate the secure flow of international cargo, provides plans for specific segments of the international supply chain, and focuses on guidance for the resumption of operations following an all hazards incident.15 The strategy aims to integrate the many plans and initiatives currently in place in order to secure the supply chain (USDHS 2007).

USDHS and its partners have programs in place to secure maritime cargo throughout the chain of custody, from the origination of the cargo through its arrival at a final destination (Frittelli 2002). Table 9 provides an overview of federal programs to secure the various points in the maritime supply chain. Each program in this table has a unique responsibility in maritime cargo security and takes a specific approach to it.

Customs-Trade Partnership Against Terrorism (C-TPAT) is a voluntary public-private partnership program in which the private owners of supply chain infrastructure and cargo work with U.S. Customs and Border Protection (CBP) to improve the security of the international supply chain. CTPAT participants are asked to ensure that their own security plans and practices are in compliance with C-TPAT security criteria and coordinated with their business partners throughout the supply chain. CBP validates and regularly revalidates an entity's participation in C-TPAT (USDHS 2007). As of March 2008, C-TPAT had more than 8,200 certified members. C-TPAT members account for 80 percent of the value of goods imported into the United States (USDHS CBP 2008).

The Secure Freight Initiative (SFI), a joint program of USDHS and the U.S. Department of Energy (USDOE), is implemented by CBP and USDOE. SFI began as a pilot program in which seven overseas ports participated in scanning all U.S.-bound containers for nuclear or radiological materials. The SFI pilot phase was intended to help authorities prepare for the scanning of U.S.-bound containers that will be required in the future (GAO 2008b). In the pilot phase, however, 100 percent of container cargo was scanned at just three of the seven participating ports: Port Qasim, Karachi, Pakistan; Puerto Cortes, Honduras; and Southampton, United Kingdom (USDHS CBP 2007a).

SFI builds on the Container Security Initiative (CSI), a CBP program, which works with foreign governments and cargo and facility owners to target and inspect high-risk cargo at its port of origin. SFI also builds on the USDOE's Megaports Initiative, which works with partner governments to scan containers for nuclear or radioactive materials (USDHS CBP 2007b).

In addition to these programs, the Transportation Security Administration (TSA) began distributing individual port security grants in 2002. By fiscal year 2005, grants awarded totaled $632 million. Grants have aided ports in conducting security assessments, enhancing facility or operational security, and implementing cutting-edge technology (Haveman et al. 2006).

13 JIT involves keeping materials on hand for only a few days or sometimes only a few hours of operation.

14 A final version of this strategy is scheduled to be completed by October 2009.

15 An all hazards incident refers to any incident, terrorist or natural disaster, that could affect the maritime transportation system.