20 October 2021 - During the first World Maritime Merchants Forum held in Hong Kong, distinguished guests from the global shipping industry were invited to deliver speeches on the hot topics and challenges in the industry development. They extensively expressed and exchanged their views via round-table discussions about three topics, namely construction of a sustainable maritime supply chain in the new era, the direction of carbon reduction and the use of technology in the shipping industry, the industrial transformation and upgrade driven by technological innovation, and put forward recommendations and suggestions on sustainable development of the shipping industry.

Li Xiaopeng, Minister of Transport of the People's Republic of China, attended the Forum and delivered a speech by video. He pointed out that the shipping industry is facing severe challenges and difficulties brought about by a mixture of great changes unprecedented over one hundred years and the global COVID-19 pandemic. As an important pivot in serving the national economic cycle and promoting economic globalization, China's shipping industry should: adhere to the principles of openness, cooperation, consultation, contribution and shared benefits, promote industry interconnection, openness and integration at a higher level; be committed to innovation-driven, sustainable development, accelerate the establishment of an innovative development system underpinned by technological innovation, and jointly promote the green, low-carbon, intelligent and safe development of shipping industry; work with others to maintain a safe, smooth international logistics supply chain, eliminate the blocking points in the international maritime logistics chain, and provide better services in the development of world economy and trade as well as in the improvement of people's livelihood.

Yin Zonghua, Deputy Director of the Liaison Office of the Central People's Government in the Hong Kong Special Administrative Region, noted in his speech that, China is actively creating a new development pattern and advancing the building of the Belt and Road Initiative at a high level, which will bring about enormous development vitality and potential to the global shipping industry. He hoped people can get substantial returns during the participation in China's high-quality development. Mr Yin further pointed out that, it is explicitly specified in the Fourteenth Five-Year Plan and the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area that Hong Kong's position as an international shipping center should be reinforced and improved; as long as Hong Kong's shipping industry accurately locates its development direction and speeds up transformation and upgrade, it will definitely have a bright future; openness and cooperation is a significant driving force in increasing the vitality of international economy and trade. As long as the awareness of a community of shared future for mankind is established, an open global economy is jointly maintained and developed, and a new shipping business mode featuring openness and mutual benefits is built, Hong Kong's shipping industry is bound to achieve better development.

Miao Jianmin, Chairman of China Merchants Group, delivered a keynote speech. He called for building a new global shipping ecology that is fairer, greener, more efficient and more resilient. The "encounter action" against the COVID-19 pandemic shifting toward a "protracted war" around the globe, the changes in trade pattern caused by the de-globalization trend, and the new driving forces and pressure arising from new technologies and requirements bring about significant changes and new development potential to shipping industry at the same time. In order to keep up with the trend and gain an advantageous position in this historical opportunity unprecedented over one hundred years, the shipping industry must have an "inclusive and open" mind, create a "green and healthy" industrial environment with the aid of "advanced and efficient" technologies and methods, and respond to changes based on the time and circumstances.

Teresa Cheng Yeuk-wah, Secretary for Justice of the Hong Kong Special Administrative Region, delivered a keynote speech and stressed that, Hong Kong was included into BIMCO Law and Arbitration Clause 2020 by the Baltic and International Maritime Council (BIMCO) as one of the four designated arbitration centers in 2020. Hong Kong has unique advantages in shipping law and dispute resolution services. Lots of challenges exist at present, but unique opportunities are also available. Hong Kong will make full use of these advantages to further reinforce its position as an international shipping law and maritime arbitration center.

Sabrina Chao, President of BIMCO, delivered a keynote speech and said that, the shipping industry is facing various challenges; competition will exist in the industry for a long time, which must be faced up to by the whole industrial chain. Solutions to address existing and potential problems can be found only through the spirit of openness and transparency and unremitting efforts, thereby improving the development level of the whole industrial chain and realize mutual benefits and common prosperity.

Guy Platten, Secretary General of the International Chamber of Shipping, delivered a keynote speech and held that, the world is recovering from the impact of COVID-19 pandemic and under reconstruction, and the shipping industry will play a key role during the recovery process. Apart from the pandemic, broader digitization, new trade modes and climate changes have brought about transformative opportunities and challenges to the industry. Mr. Platten proposed three solutions, namely personnel training, R&D investment and market incentives.

Xu Lirong, Chairman of China COSCO Shipping, delivered a keynote speech and said that, the new potential energy for the transformation and upgrade of the shipping industry is gradually brewing, which is manifested as follows: first, the new trade pattern begins to function as the basis for the transformation and upgrade of shipping industry, and the China factor will play a bigger role in shipping market; second, new customer needs guide the transformation and upgrade direction of shipping industry, and reliability of the supply chain becomes the primary goal of all parties; third, new environmental protection rules is reshaping the transformation and upgrade environment of the shipping industry, and emission reduction will have a profound impact on the industrial chain for a long time.

Hu Jianhua, President of China Merchants Group, delivered a keynote speech and believed that, trade and transportation are vital because the global economy is interconnected. With the long-term duration of COVID-19 pandemic, ports, as an important hub connecting land and sea transportation, should actively play a key role in the logistics allocation system, strengthen cooperation with essential factors such as trade and shipping from the aspects of coordinated development, intelligent development and green development, increase the level of intelligence, and promote the coupling of the industrial chain. Only by doing so can significant transformation and development of the shipping industrial chain be truly achieved.

Bjorn Hojgaard, Chairman of Hong Kong Shipowners Association, delivered a keynote speech and thought that, the future green development of shipping industry should start from operation efficiency and design efficiency. As far as operation efficiency is concerned, digitization of shipping industry is a revolutionary development. When it comes to design efficiency, the short-term plan is engine power limitation, installation of energy-saving equipment and systems, and implementation of air lubrication systems and WASP (Wind Assisted Ship Propulsion) projects; the medium-term plan is to find alternative fuels; the ultimate plan is new nuclear technologies that are cutting-edge, safer and completely carbon neutral.

Philippe Louis-Dreyfus, President of Louis Dreyfus Armateurs, delivered a keynote speech and pointed out that, an increasing number of industrial and high-tech activities are driving ship complexity to increase and crew members' expertise to improve. Although the digitization trend promotes the positive development of shipping industry, its inherent risks cannot be ignored. Environmental protection is also stuck in the dilemma of solution and path selection. Moreover, under the background of rising freight rates in some shipping markets, the image of shipping industry that the public perceives becomes an increasingly prominent issue.

John Lloyd, CEO of Nautical Institute, delivered a keynote speech and noted that, with all the changes and challenges, the whole industry must fully recognize the importance of crew members to ensure that the global trade can be carried out stably and effectively. Although great challenges and difficulties exist in allocation and arrangement of crew members across different countries, the rights of crew members should be effectively guaranteed since this is a key factor associated with crew members' safety and ships' operation efficiency. Regardless of subsequent development, continuous cooperation between government organizations is crucial to helping solve the crew crisis.

Bud Darr, Executive Vice President of Mediterranean Shipping Company (MSC), delivered a keynote speech and said that, if shipping companies want to maintain healthy development in the global trend of carbon reduction and emission reduction, they must constantly cooperate with each other, stay creative and keep a positive, optimistic attitude. Besides, shipping companies should strengthen cooperation with people having expertise in de-carbonization field, and should not arbitrarily exclude those ideas that have not yet matured. Instead, they should always firmly believe that they are able to solve the problem eventually with a series of solutions.

Round-table Discussion

Topic 1: Construction of a sustainable maritime supply chain in the new era

Round-table Discussion 1 was presided over by Hing Chao, Executive Chairman of Wah Kwong Maritime Transport Holdings Limited. Guests including Capt. Xie Chunlin (Chairman of CMES Shipping), Angad Banga (Chief Operating Officer of Caravel Group), Martin Fruergaard (CEO of Pacific Basin Shipping Limited), Li Lianjun (a senior partner of Reed Smith Richards Butler and an international maritime arbitrator), Benjamin Wong (Head of Transport, Infrastructure and Advanced Manufacturing of InvestHK) and Edward Liu (Principal Representative of ICS (China) Liaison Office) shared their views on how to construct a sustainable maritime supply chain in the new era. Their main opinions are summarized as follows:

To construct a sustainable maritime supply chain, how to promote the structural adjustment of shipping industry should be considered by placing the industry into the global economy; a relevant training system and mechanism should be established from the aspects of ship safety and new technology to ensure the supply of crew members; how to convert profits into reinvestment and how to promote a virtuous circle of the industry should be actively thought about.

The world is an interconnected whole, and changes to a small link in the maritime supply chain will have a serious impact on the global economy. The shipping industry needs platforms like World Maritime Merchants Forum, through which people can propose solutions to address problems and can promote industry development.

Crew members are the most powerful "protectors" for the maritime supply chain. However, the outbreak of COVID-19 pandemic has blocked the circulation of the maritime supply chain, and problems such as crew members providing services in an extended period and shortage of senior crews have become the new normal. Therefore, all parties are called on to pay more attention to crew members.

As a global shipping center, Hong Kong has a sound legal system and a solid talent base, so it should make full use of its advantage of low tax rates and provide more high value-added services in shipping arbitration, insurance claim settlement, financing, etc., to help global shipping companies exert more advantages in the Greater Bay Area.

Topic 2: Carbon reduction path and technology selection in shipping industry

Round-table Discussion 2 was presided over by Wellington Koo, Executive Director of Valles Steamship Co., Ltd. Guests including Tim Smith (Chairman of Maersk Shipping Hong Kong & Chief Executive Asia of APM Terminals), Kishore Rajvanshy (Managing Director of Fleet Management Limited), Paolo Moretti (CEO of RINA Services), John Kaare Aune (CEO of Wallem Group), Peter Taylor (Managing Director of Commodities and Global Markets of Macquarie Group) and Tabitha Logan (Co-Founder of YPSN & Senior Manager of Asia Maritime Pacific) shared their views on carbon reduction path and technology selection in shipping industry. Their main opinions are summarized as follows:

In order to achieve the goals of carbon neutrality and emission peak, shipping companies should establish clear goals and strategies, and raise a green, low-carbon awareness from top to bottom inside them. All parties in the shipping industry should cooperate closely and work out different energy conservation and emission reduction solutions, focusing on the common goals.

Under the pressure from carbon reduction policies and the regulatory system, the shipping industry has to more actively rise to the challenge of technological transformation. In terms of implementation, how to quantify carbon emissions is a problem, and big data and carbon tracking may be employed to address it. Shipping companies should invest more in energy consumption and technology innovations and pay attention to the development trend of fuels in a real-time manner.

De-carbonization is the key to the sustainable development of shipping industry. The shipping industry should dare to try alternative fuels, get more industries involved and cooperate with them to find the path to achieve the goals.

Technological innovation is important, and operation efficiency should also be attached importance to by providing seafarers with more training that is more specialized such that they can adapt to technological changes.

Topic 3: Shipping industry transformation and upgrade driven by technological innovation

Round-table Discussion 3 was presided over by James Lei, Chief Technical Adviser of Joint Labs in Asia. Guests including Oyvind Pettersen (Director of DNV Technical Center for Greater China), Xu Qin (Managing Director and Partner, BCG, Lead of DigitalBCG Accelerator Systems in Greater China), Qian Shengwei (Vice President of Inmarsat Maritime), Chen Guanhua (Co-Founder of Hong Kong X Technology Fund), Li Xin (Head of Smart Ship Project of Shanghai Merchant Ship Design & Research Institute) and Yang Dong (Deputy Director of Shipping Research Center, The Hong Kong Polytechnic University) shared their views on shipping industry transformation and upgrade driven by technological innovation. Their main opinions are summarized as follows:

Shipping companies should provide better customer service experience, and improve their competitiveness through digital transformation.

Ship management is a very complex, systematic project. Algorithms and technological methods can help us obtain optimized information that is more accurate and effective, and make correct decisions.

Standardization is required in the digital development of shipping industry, and the key to such standardization is to unify industry standards by using IoT (Internet of Things) and blockchain. All parties in the shipping industry must work together to establish a common industrial standard for shipping digitization through extensive cooperation.

The last major change in shipping industry was the application of standardized containers 50 years ago. The use of big data has changed the traditional business mode, decision-making model and industry competition situation, and will become the next major change. The shipping industry should spare no effort to use big data and AI technology in real-time monitoring and decision-making.