The Common EU Maritime Transport Policy

Policy Europeanisation in the 1990s

Athanasios A. Pallis

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351892513
• Edition: 1
• Topic: Tecnologia e ingegneria
• Subtopic: Trasporto e navigazione

During the 1990s there were two major developments to the Common EU Maritime Transport Policy (CMTP): the establishment of European Union policies on safe seas and on shortsea shipping respectively. This book critically analyzes and appraises these and other developments to the CMTP in this period, while also studying policy Europeanization. It focuses on both the economic environment of maritime transport and the interaction of policy makers and organized interests during the policy-making process, with an emphasis on the political dimensions. By developing an innovative economic model, the book examines the ways in which governmental and non-governmental policy makers and their ideas interact within the EU's structure and dynamics, and shows how these factors account for why, when and how the specific common EU policy has developed.

1 Setting the Scene

Since the completion of the Single European Market (SEM) the ratification of the Maastricht Treaty of the European Union (TEU), and the Treaties of Amsterdam and Nice, European integration has embarked on a new economic and political period. As the 'uniting of Europe' continues the politico-economic structures of the European Union (EU)¹ and its member states are vastly transformed. While monetary integration is part of the agenda, perceived with a mixture of hope and trepidation, common EU policies are developed in an attempt to give regional answers to sectoral (meso) economic problems.

One of the latter cases is the Common Maritime Transport Policy (CMTP). Since 1974 the European Union constitutes an additional supranational policy-making jurisdiction in the field of maritime transport. The first attempt to introduce a cohesive EU maritime transport policy took place in 1986. In recent years, the scope and depth of the particular EU policy have widened. Even though collective policy solutions do not always arise, discussions have shifted from the minimalist approach, which did not endorse the need for common initiatives, towards the consideration of a comprehensive EU policy.

In fact, the maritime transport system has been a highly institutionalised and politicised economic sector. Precisely because of its strategic economic significance, national governments are performing as market (de)regulators, as well as maritime infrastructure investors and owners. International intergovernmental organisations are consistently involved in the life of the sector striving for global solutions to numerous issues. In addition, an extensive industrial self-regulation has been frequently in application.

Taking into account the very international character of maritime transportation, the contemporary economic environments, and the preceding policy-making traditions, how are we to explain the emerging movement towards the Europeanisation of the maritime transport system's institutional and regulatory framework? Which factors induce, determine, or decisively interfere with this trend? What decides the course and the changes of the EU Maritime Transport Policy in the 1990s?

These are the questions that this book addresses. To begin with, it takes the view that political variables have a definitive impact on the character and direction of a common EU policy. Of course, EU-level policies do respond to the economic context. However, to see them solely as a response to prevailing economic conditions or as the resolution of technical issues is an incomplete view. Policy-making is also a highly political process. Stakeholders, either associated in interest groups or acting independently, demand or reject certain policy initiatives. National governments attempt to drive the integrative process towards their political targets. EU institutions jockey for influence over policy developments. For reasons such as these, it is a major challenge to correctly conceptualise the policy development process, so as to identify the factors that most influence it.

The emphasis is on the political dimensions of developing the CMTP. This book concentrates on the ways that governmental or nongovernmental policy actors and their ideas interact within the contemporary structure and dynamics of the EU policy-making game, how these factors account for why, when, and how, the specific common EU policy is developed. In Chapter 2 the theoretical aspects of the relationship between policy actors and the process of developing EU policies are explored. The synthesis of this body of literature provides the background on which an analytical framework for research is developed. In essence, by bringing the theoretical account of (historical) neoinstitutionalism into the analysis of the CMTP, this volume examines whether a concept that puts particular stress on the critical role of EU political institutions during the policy making process and, consequently, the advancement and content of EU level policies is valid, or not. Two issue-areas, the establishment and the progress of the common policies on safe seas and short-sea shipping respectively, are detailed to test this framework.

Before this, however, the introductory chapter has a twofold intention. Firstly, to highlight the strategic magnitudes of the maritime transport system for the enhancement of integrative benefits. Second, to frame the politico-economic setting within which the specific policy is examined, by providing background information regarding the sector's politicisation, and the different policy-making levels.

The Strategic Significance of Maritime Transport

Maritime transport is a genuine sector, economically and environmentally of strategic significance for the European economy. A basic infrastructure of trade and an important lever of economic development, effective seagoing transport is, in the words of an ex-Transport Commissioner, 'a vital support to the concept of the Single Market' (Clinton-Davis, 1994). The provision of competitive services by a EU-fleet, the efficient operation of the port industry, as well as the maintenance and modernisation of infrastructure and superstructure, guarantee quality transport services to exporters and importers, and increase the welfare benefits of transport users, producers, and society as a whole.

The sector is important in its own right primarily because it is the dominant mode of transport. In 1999, 1215 million tonnes or 70.8% of the trade between the EU member states and third countries (extra-EU trade) were transported by sea.² Seaborne trade between member states (intra-EU trade) reached 295 million tonnes, or 28.2% of the total. In the case of some Member States, the flow of maritime transport accounts for practically the total of their international trade. According to the latest data available (1996), international short-sea shipping accounts for 13% of the total combined transport traffic in Europe (in terms of tonne-kilometres), with an average short-sea distance of 800 kilometres per tonne. In addition, the national coastwise traffic within member states (cabotage trade) was 162.5 million tonnes and a significant volume of the deep-sea cargoes was transhipped between one European port and another (feeder trade). The EU of fifteen member states, which represents the biggest trade area of the world, is unmistakably a massive user of maritime transport services. With the progress from a Common Market towards a European Union being accompanied by substantial increases in both passenger and freight movements, the EU has a growing economy with the demand for transport growing at an even faster rate. An unchanged scenario foresees that the amount of goods loaded at EU maritime ports will increase to 3385 million tonnes by 2010, when in 1980 and 1993 these goods aggregated 1836 and 2300 million tonnes respectively (ESPO, 1995).

The controlling interest behind 33% of the world merchant fleet is located in terms of parent owner in an EU member state. Operating either under EU-flags or third non-EU flags (44% and 66% of the total EU-owned tonnage respectively in 1999) many of these vessels, are routinely involved in cross-trade, this is, the carriage of cargoes whose origin and destiny are non-EU countries. In aggregate, EU-owned ships transport a significant part of the steadily growing international seatrade. They do so by providing either liner or tramp services. The former suggests the operation on fixed routes by fixed time schedules, the latter the carriage of commodities on a voyage, a limited number of consecutive voyages, or a short-term basis.

The sector is an important employer, both at sea and ashore. In 1994, the EU shipping industry alone employed 161,859 officers and seafarers on EU-flagged vessels. Besides, almost 74,000 EU citizens were employed on EU-owned vessels operating under non-EU flags (CEU-DG VII, 1996a). In total, approximately 2.5 million people are employed in maritime related industries of the EU (Power, 1994). Furthermore, maritime services make a substantial contribution to the European economy through earnings of foreign currency. Directly these earnings are attained through freights, wages, and the provision of port facilities, while indirect contribution is added by the maritime related industries, including insurance, banking, shipbuilding, ship repairing, and legal activities. Two examples highlight the significance of this contribution. The shipping exchange inflow in Greece represents over 12% of the total invisible receipts of the country's Balance of Payments. In 1994, the net contribution of British shipping was $3.81 (US) billion with $1.6 (US) billion earned by the maritime related activities in the City of London (BCS, 1996). Overall, the shore-based turnover of the EU-flagging vessels is estimated to average US$ 43,720 per dwt (CEU-DG VII, 1996b). The ratio shore-based/ship-based value added to the EU economy is estimated to exceed 50/50, with about 44% of this added value flowing back to the public authorities in form of taxes and social contributions (Core Group, 1995). The size of the maritime transport sector's endowment cannot be disregarded.

Moreover, as an inseparable part of the EU transport system, the maritime mode is of apparent merit at micro, meso, and macro-economic levels. Within the SEM, an interaction between transport and the location of economic activities takes place as a two-way process: transport serves a given spatial distribution of activities, but differential developments of transport to suit market conditions in different locations affect the future development of these localisations (Vickerman, 1992). Undergoing changes in the industrial structure, most notably the move from basic industries to manufacturing, upgrade the relative importance of transport in localisation decisions. Transport costs, as well as the operation of fast, flexible, and high quality freight services, take on greater weight because industries are increasingly functioning in wider geographic areas, and increasingly adopting operating and production methods that are transport dependent. Transport becomes an input to production, either by carrying finished goods or increasingly, as the pace of integration spreads, moving inputs and intermediate goods. Through operation and cost changes, consumption, trade and production patterns may be earned.

The transport system is also critical to regional production potential. It improves the core-periphery relations and result in the development of the necessary links for the spatial and economic development within and between the regions, as well as in the diversion of the current traffic away from traditional routes and modes (Vickerman, 1994). Within the SEM European nations are transformed into open-access economies whereas the potential of some regions to become losers and others to become winners increases, therefore the momentousness of the factors that can endow the balanced regional development is upgraded. In the case of the maritime mode this is underlined by the economic geography of Europe. The fifteen member states alone include a substantial coastline, many islands, and large peninsulas. The unique EU port structure (the largest concentration of ports in the world) directly interlinks a considerable part of the territory and many industrial centres. Due to these characteristics, as well as the geopolitical developments in Europe, the expansion and effectiveness of intra-EU maritime trade enhance the continent's socio-economic cohesion. By providing essential links to islands and remote regions, maritime flows are a critical force of balanced regional development, especially as a considerable number of maritime regions are located in the less prosperous member states.

Positive linkages between transport provision and economic growth exist, though their precise quantification remains difficult. Scholars, who concentrate on the economic impacts and productivity effects of transport infrastructure, conclude that the efficient operation of the latter and the value of the services generated, in short transport itself, favour the growth of an economy as a whole (cf. Kessides, 1993). An adequate transport system is a sine qua non for modern economic development.³ This relationship contains a non-cost dimension as well. A high quality transport system is a precondition for enabling the economy of a country or region to grow without encountering bottlenecks and thus to change its sectoral structure; increasing the spatial mobility of citizens and goods; offering the freedom of choice to use different modes according to the potential of each mode and the requirements of the respective goods shipped; increasing the efficiency of energy use; protecting the environment; and promote further social and economic co-operation on an international level (Blum, 1985).

The aforementioned economic merits are positively related to the progress of European integration. The cost effectiveness and reliability of transport undertakings are one of the most fundamental factors influencing the maximisation of the economic integration benefits. Briefly restated, the framework of the Custom Union theory (Viner, 1950; Meadey, 1955), which forms the basis of European economic integration, anticipates economic benefits in terms of trade creation and trade diversion in all stages of integration.⁴ At the national level they derive from trade specialisation, at the regional level from geographical specialisation, at the micro level they are fundamental about maximising economies of scale. Increased trade has to be realised physically; therefore, efficient transport is required. Failing that, transportation remains a 'natural trade barrier' (Nielsen et al, 1992), which replaces tariffs as an obstacle to further specialisatio...