ARTICLE IN PRESS

Marine Policy 33 (2009) 733–735

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Marine Policy

0308-59

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Short communication

Recovering after a maritime terrorist attack: The APEC TradeRecovery Programme

Joshua Ho �

S. Rajaratnam School of International Studies, Nanyang Technological University, Singapore 639798, Singapore

a r t i c l e i n f o

Article history:

Received 23 December 2008

Accepted 4 January 2009

Keywords:

APEC

Maritime Terrorism

Trade Recovery

CSI

C-TPAT

ISPS Code

7X/$ - see front matter & 2009 Published by

016/j.marpol.2009.01.001

+65 67906624; fax: +65 67932991.

ail addresses: ishhho@ntu.edu.sg, joshua.h.ho

a b s t r a c t

Since the September 11, 2001 terrorist attacks on the World Trade Centre and the Pentagon in the United

States, many measures have been taken to prevent similar attacks from happening against iconic targets

from the land, air, or sea. However, most of the efforts have so far focussed only on the prevention of

terrorist attacks. The APEC Trade Recovery Programme (TRP) was developed to increase the speed of

post-incident recovery amongst the APEC economies and the US to facilitate a resumption of trade after

a terrorist incident.

& 2009 Published by Elsevier Ltd.

Introduction

Since the September 11, 2001 terrorist attacks on the WorldTrade Centre and the Pentagon in the United States, manymeasures have been taken to prevent similar attacks fromhappening against iconic targets from the land, air, or sea. Onland, security at critical infrastructure has been increased andpersonnel and baggage scanned before entry into importantbuildings. Air travellers have been subjected to increased screen-ing and their check-in and carry-on luggage scanned to detectdangerous materials. In the maritime domain similar measureshave also been implemented. These measures include theContainer Security Initiative (CSI), which screens and scanshigh-risk US-bound containers at the port or origin before entryinto the main ports located in the US; the International Ship andPort Facility Security (ISPS) Code, which mandates that portfacilities and ships appoint a security officer to oversee theimplementation of contingency plans to deal with different levelsof security threat; and the Customs–Trade Partnership AgainstTerrorism (C-TPAT), which is a US Customs effort to partner withindustry to increase the security of the supply chain in exchangefor faster customs clearance. However, most of the efforts have sofar focussed only on the prevention of terrorist attacks. Whathappens when prevention fails? How is the United States and itstrading partners going to recover from a terrorist attack?

Elsevier Ltd.

@gmail.com (J. Ho).

Impact of a US port shutdown

A study conducted in October 2006 by Booz Allen Hamiltonconcluded that the economic impact on the 12 APEC economiesas a result of a US port shutdown due to a terrorist attackwould be significant [1]. The study indicated that the economicimpact increased dramatically with the length of time thattrade is disrupted. A prolonged closure of transportation hubswould potentially result in a global recession by slowinginternational trade, which would reverberate throughouttrading partners’ economies. For example, if trade at the USport was impaired for 15 days, the cumulative loss of GDP forthe 12 APEC economies for 3 years was estimated at US$82billion dollars in 2006. The loss increases to US$175 billion for a30-day impaired trade and to US$499 for a 60-day impairedtrade. The 12 APEC economies studied, other than the US, includedChina, Hong Kong, Japan, South Korea, Indonesia, Malaysia,New Zealand, Philippines, Singapore, Thailand, Vietnam, andAustralia.

The APEC Trade Recovery Programme (TRP) was developed toincrease the speed of post-incident recovery amongst the APECeconomies and the US since any delay in trade resumption willhave an exponential effect in loss in trade and GDP. The APEC TRPdoes this by establishing principles and guidelines that willfacilitate the restoration of trade as rapidly as possible. It alsoprovides actions that will facilitate trust and confidence in theprocess. In essence, the TRP is a how-to guide that provides aframework for common actions that will aid in the communica-tion and decision-making processes between states after anincident.

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The three pillars of the TRP

The Trade Recovery Programme consists of three main pillars:a Plan of Action, Model Guidelines and Communications. The Planof Action is a sequence of steps that participating economiesshould take immediately following an attack that will initiate theTRP and begin the process for re-establishment of trade. Having aspecified set of procedures that participating economies canquickly implement following a terrorist event prevents counter-productive, unilateral reactions; increases transparency of ac-tions; and gives partner economies clear expectations.

The Model Guidelines states actions that are pre-establishedand consistent with applicable industry standards where avail-able. They provide the added assurance of trust and transparencyneeded to support the TRP. The Model Guidelines provides acommon framework and understanding of what must be done inorder to achieve port security, trade resumption and tradefacilitation. It establishes pre-determined security measures andprocedures to be invoked during post-event periods of heightenedrisk and includes measures based upon established internationaland industry standards.

Communications address all of the relationships, interactions,and exchanges that need to exist in order to implement theprogramme. It is the vital link that enables economies to developtrust and demonstrate transparency, both of which are key torestoring trade following an event. Communication is themechanism by which relationships will be formed prior to anevent and actions and assurance coordinated following an event.It identifies stakeholders and establishes relationships in order toadapt to guidelines to specific economies.

Strengths of the APEC TRP

It must be said that the APEC TRP has many strengths. Firstly,participation in the TRP by member economies is voluntary. Aspartner economies may not have existing plans and proceduresthat can serve as the foundation for a TRP, in particular for themanagement of containers and cargo, it is important that the TRPbe voluntary to allow partner economies time to developcontingency plans at a comfortable pace. In particular, the TRPsuggests that member economies implement the process in astep-by-step manner through pilot projects with the eventual aimof adopting bilateral or multilateral arrangements.

Secondly, the TRP is non-prescriptive, flexible and builds uponexisting frameworks available nationally or internationally. It doesnot re-invent the wheel. For example, the TRP makes use ofexisting international guidelines such as the World CustomsOrganisation’s (WCO) SAFE Framework of Standards (FoS), theISPS Code, as well as the ISO 28000 and 28001. In addition, wheredomestic and regional supply chain security initiatives are alreadybeing undertaken or pursued by APEC economies, the TRPcomplements such initiatives rather than displace them. As aresult, the TRP offers opportunities to build on existing efforts,expand existing arrangements, and extend tangible benefits toboth partner economies and the private sector.

Thirdly, the TRP is a simple step-by-step approach that partnereconomies can follow without too much effort. The TRPs threepillars of a plan of action, model guidelines, and communicationsplan are simple enough to be implemented without too muchdifficulty and yet comprehensive enough to ensure that there issufficient action taken and information shared to rebuild theconfidence and trust between trading partners after an event hasoccurred.

Where the APEC TRP can be improved

Despite its strengths, the TRP could be improved to make itmore palatable for partner economies to participate in as well asto make it more comprehensive.

Firstly, countries in Southeast Asia do not seem to be verysupportive of the TRP. In particular, less than half of the ASEANcountries participated in the APEC Study Group Meeting on TradeRecovery. This is disappointing given that Southeast Asia was onceconsidered the second front on the war against terrorism. Theremight be various reasons for this. One could be that the countriesdo not see a need to participate and may not feel that theireconomies will be affected much. More has to be done to convincesuch countries to participate. In particular, the impact onparticular economies should be elaborated on and the benefitsexplained. Another reason could be that partner economies fearthat exchanging trade-sensitive data might result in a loss ofcompetitiveness for their companies as the information could beused by their competitors or worse still used as targetinginformation by terrorists. Partner economies must therefore beconvinced that the information shared will be kept with thestrictest of confidence. Yet another reason could be thatthe countries simply do not have the resources or the capacityto implement supply chain security programmes in a compre-hensive manner. APEC may consider granting aid to thesedeveloping economies to enable them to implement elements ofthe TRP under pilot projects.

Secondly, the US may want to consider granting incentives toeconomies to participate in the TRP. In 2007, the US hadintroduced a law, ‘‘Implementing Recommendations of the 9/11Commission Act of 2007’’, that mandates new security require-ments on all aspects of freight transport, including the scanning ofall air cargo carried onboard commercial aircraft within 3 years(2010), and all maritime containers destined for the US at foreignports after 5 years (2012) [2]. Many industry representatives andexperts have expressed grave concerns over this legislation as itwill result in enormous costs to users, suppliers and ultimatelyconsumers. As an incentive to partner economies that join theTRP, the US may want to consider waiving the requirement for100% scanning of containers bound for its ports and limit it to thescanning or inspection of higher risk containers based on anassessment of container information as is currently the case underthe Container Security Initiative [3].

Thirdly, the TRP only addresses the threat of terrorism from anexplosive device shipped through a container. Although most ofthe world trade by tonnage is shipped by sea, the dollar value ofworld trade freighted by air is also very significant. It may benecessary to develop a recovery programme for air freight as wellsince its disruption could also have severe economic impact onmember economies. It may also be necessary to make the TRPmore comprehensive to include more forms of trade disruptionsother than that caused by a terrorist attack. Trade disruptions dueto natural disasters, industrial action, or pandemics could alsohave severe repercussions on member economies. For example, a2005 study done by the University of Southern California showedthat the economic impact of an earthquake in Los Angeles wouldcost more than that arising from a terrorist attack, costing US$135billion versus US$34 billion, respectively [4].

The ability of an economy to minimise the time that trade isdisrupted and to contain the system impacts will directly reducethe resulting economic loss. While the potential loss to infra-structure is great, it is the ripple effects of trade disruption thatcreate the largest economic impact. The complex nature of today’strade system means that all components of that system aredependent upon one another for safe and secure trade. The APECTRP therefore aims to promote safe and secure trade and, in

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particular, aids in the restoration of trade activities as quickly aspossible after a terrorist event through the establishment of clearplans of action, model guidelines for action, and robust commu-nications.

References

[1] Counter Terrorism Task Force. Asia-Pacific Economic Cooperation. APEC TradeRecovery Programme. Singapore: APEC Secretariat; 2008 July.

[2] Shippers raise trade concerns over US 100% container scanning. Lloyd’s List, 10August 2007.

[3] US Customs and Border Protection. Container security initiative: 2006–2011strategic plan. August 2006, Available online at /http://www.cbp.gov/linkhandler/cgov/trade/cargo_security/csi/csi_strategic_plan.ctt/csi_strate-gic_plan.pdfS, accessed on 12 September 2008.

[4] Peter Gordon, James II E Moore, Harry W Richardson, Qisheng Pan. Theeconomic impact of a terrorist attack on the twin ports of Los Angeles–LongBeach. In: Harry W Richardson, Peter Gordon, James E Moore II, editors. Theeconomic impacts of terrorist attacks. Massachusetts: Edward Elgar Publish-ing, Inc.; 2007. p. 262–86.