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Security
at the Ports
Brian
Trumbore
President/Editor, StocksandNews.com
Back in 2004, I wrote two pieces for
another link at StocksandNews that pertain to the
huge issue of the day, the operation of some U.S.
port terminals by a company based in United Arab Emirates.
In light of this, the following is equally appropriate
for "Wall Street History."
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Of
the issues pertaining to Homeland Security, these
days securing America's ports is as important as they
come, yet we all know that given the lack of technology
and systems in place it's virtually impossible to
prevent a serious terrorist attack.
Over
$500 billion of goods are shipped in and out of the
U.S. from some 178,000 foreign businesses each year,
all in 20- and 40-foot containers. On an average day
19,000 new boxes enter U.S. ports and a system that
is built for speed is still at least a year from being
able to efficiently screen each container for deadly
weapons.
The
ports of Los Angeles / Long Branch and New York /
New Jersey by most estimates handle about 60% of the
total cargo traffic in any given day and an estimated
40% of American trade in one form or another depends
on containers that flow through the former complex.
But aside from these two seaports, there are about
another 350 in which goods reach the U.S.
No
doubt, since 9/11 screening has been tightened for
chemical / biological weapons, explosives, missiles
or components for nuclear weapons, but as Fen Montaigne
points out in an article for the January 2004 issue
of Smithsonian, weapons can easily be shipped in small
batches, on different containers, thus eluding detection
by even the most sophisticated gamma-ray machines
and radiation devices. ABC News, for example, has
twice been able to smuggle in radioactive material
from Eastern Europe by this method.
"The
system is absolutely wide open, and anybody with 3,000
bucks in Asia and a little less in Europe can get
a box delivered to their lot or home and they can
load it to the gills with whatever they want, close
it with a 50-cent lead seal, and it's off to the races,"
says Stephen E. Flynn, a retired Coast Guard commander
and an expert on seaport security. "As I look at the
cargo transport system today, when I wake up each
morning and see that we haven't had an attack, I just
declare ourselves lucky. The secretary of the treasury,
the secretary of defense, the secretary of commerce,
the secretary of state, the president of the United
States should be tossing and turning at night knowing
that this system has so little security."
In
the old days, U.S. Customs inspectors merely looked
for drugs and it was well known that security was
lax. But these days Customs requires all shippers
to declare the contents of each container 24 hours
before they're loaded onto a freighter bound for the
U.S. The new computer systems then scan the manifests
for unknown importers, manufacturers or shippers that
have never delivered here before.
The
big debate internally is whether or not the current
technology could detect a small nuclear bomb. Thus
far, the administration has spent about $350 million
on upgrading security, but the U.S. Coast Guard estimates
it needs over $1 billion more just in 2004 alone.
When
one looks at the overall situation, any kind of significant
attack on a port would cripple the economy.
"What
I'm almost certain of, from talking with people at
senior levels of government, is that if we have a
major event involving one of our ports and a container,
we will stand down the system," says Flynn, now a
senior fellow for national security at the Council
on Foreign Relations. "We will shut it off until we
sort it out. Now, how is the president, when he stands
in front of the American people after a very visible
and deadly act, going to reassure them that these
other containers can roll across our borders and into
our ports without worrying about them?"
And
as reporter Montaigne adds, another big problem is
simply motivation. Picture, day after day after day,
the security guards and customs agents find nothing.
Of course that's a job well done, but many are now
concerned how our Customs personnel can possibly stay
on de facto "orange alert," 365 days a year. It's
only human nature that after a while you lose your
edge?or you become susceptible to corruption.
Last
spring [Ed. 5/04] I ventured to the Far East including
Singapore. I told you in my "Week in Review" columns
of a boat trip out into the Strait of Malacca to get
a better idea of the tanker traffic passing through
this critical waterway and I also took a cable car
over the Port of Singapore.
The
port is by various accounts the world's largest in
terms of tonnage and normally it's ranked #2 behind
Hong Kong in container traffic. [Los Angeles - Long
Beach is usually #3 in such rankings.]
When
I was over there I saved a piece from a business newspaper,
the Shipping Times, which had a schedule of the various
destinations out of Singapore. Picture there are usually
about 1,000 ships in port at any one time, representing
200 shipping lines and more than 600 ports in over
120 countries.
This
is obviously a security nightmare these days and the
United States and Singapore, working with Indonesia
and Malaysia, are doing their best to buck up the
system in the region. A large tanker sunk in the right
spot in the narrow Strait, for example, could tie
up the flow of oil for weeks, while Singapore officials
have warned of "floating bombs" crashing into critical
infrastructure such as oil refineries.
None
of this is easy to pull off, mind you, and at least
Singapore is as focused as any nation in the world
on the threats it faces. It's a good ally of the U.S.
That
said I kept this shipping schedule for a reason. It's
quiz time! [Or rather, quiz your mate.] Picture trying
to track the cargo from places like the following.
[I'm leaving out more obvious destinations, with a
few exceptions. Also, I double- checked some of these.
In one or two cases I'm assuming the cargo goes upriver
or by rail from the sea when you're dealing with what
appear to be landlocked countries.]
Abidjan
(Cote D'Ivoire), Antofagasata (Chile), Apapa (Nigeria),
Balingasag / Cagay (Philippines), Bandar Abbas (Iran),
Banjarmasin (Indonesia), Batam (Indonesia?I went here),
Beira (Mozambique), Bintulu (Malaysia), Buenaventura
(Colombia), Callao (Peru), Chah-Bahar (Iran), Chittagong
(Bangladesh), Cochin (India?worked here in 1985),
Colombo (Sri Lanka), Concepcion Bay (Chile), Cotonou
(Benin).
Da-Nang
(Vietnam), Dalian (China), Daman (India), Damietta
(Egypt), Damman (Saudi Arabia), Dampier (Australia),
Dar Es Salaam (Tanzania), Douala (Cameroon), Felixstowe
(U.K.), Fos- Sur-Mer (France), Guayaquil (Ecuador),
Honiara (Solomon Islands), Inchon (South Korea), Itajai
(Brazil), Jambi (Indonesia), Jebel Ali (United Arab
Emirates).
Kaohsiung
(Taiwan?2nd largest city), Karachi (Pakistan), Khorramshahr
(Iran), Koh Sichang (Thailand), Kopervik (Norway),
Kota Kinabalu (Malaysia), Kuala Belait (Brunei), La
Spezia (Italy), Labuan (Malaysia), Lae (Papua New
Guinea), Laem Chabang (Thailand), Latakia (Syria),
Lautoka (Fiji), Libreville (Gabon), Lome (Togo), Luanda
(Angola), Male (Maldives), Manaus (Brazil), Manzanillo
(Panama), Matadi (Zaire), Mombasa (Kenya).
Napier
(New Zealand), Nhava Sheva (India), Ningbo (China),
Nouakchott (Mauritania), Noumea (New Caledonia), Odessa
(Ukraine), Papeete (French Polynesia?Tahiti), Paranagua
(Brazil), Pasir Gudang (Malaysia), Piraeus (Greece),
Pointe Noire (Congo?yes, it has a port), Port Elizabeth
(South Africa), Port Harcourt (Nigeria), Port Moresby
(Papua New Guinea), Port Osim (Saudi Arabia), Pusan
(South Korea).
Quinhon
(Vietnam), Rio Grande (Argentina), Rotterdam (Netherlands?just
put this obvious one for the heck of it), Saipan (N.
Mariana Islands?famous WW II battle here?toured it
in the mid-90s), Salalah (Oman), Sampit (Indonesia),
Savona (Italy), Semarang (Indonesia), Sharjah (UAE),
Sokhna (Egypt), Sriracha (Thailand), Taichung (Taiwan),
Takoradi (Ghana), Tanga (Tanzania), Tartous (Syria),
Tema (Ghana), Tilbury (U.K.), Tincan (Nigeria?hope
the ship isn't), Truk (Micronesia), Ulsan (North Korea),
Valparaiso (Chile), Victoria (Cameroon), Yangon (Myanmar?i.e.,
Rangoon / Burma), Yantian (China), Zeebrugge (Belgium).
If
your child knows where 50% of these places are, get
them to apply 'early admission' as soon as possible.
And can you imagine spending weeks traveling on some
of them? These aren't exactly luxury liners.
Note:
I will comment on Dubai Ports World, specifically,
in my "Week in Review" column.
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Wall
Street History returns next week.
Brian
Trumbore
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