Global freight forwarders need to collaborate on multimodality, trade facilitation, and capacity building, says Dr. Ivan Petrov, President, FIATA. The association is collaborating with many UN entities to bring its members the support they need during these uncertain times.
Ritika Arora Bhola
FIATA was formed to promote global interests of forwarders. Highlight the challenges/issues concerning the freight forwarding fraternity?
Navigating geopolitical challenges by working on transport development, facilitating trade, and building capacity: with a changing geopolitical landscape, forwarders need support in the form of collaboration on multimodality, trade facilitation, and capacity building. For this reason, FIATA is collaborating with many UN divisions (UNCTAD, UNCITRAL, UNESCAP, UNECE), the WTO, IRU, UIC, ITC, among others, to bring members the support they need during these uncertain times. Thanks to the work of FIATA Advisory Body on International Affairs, the association has produced a WTO-TFA norm to help members implement the WTO Trade Facilitation Agreement. FIATA continues to advocate for accessible AEO programmes to offer benefits to businesses of all sizes, and guide business continuity about Authorized Economic Operators. FIATA will continue to facilitate webinars about multimodal corridors like we did in the past.
Key issues
Competition in maritime markets: Over 80 per cent of goods are transported by sea. The vertical integration of shipping lines is hurting SMEs, who cannot compete with large carriers. FIATA, therefore, advocates to be voice of SMEs and developing countries, helping them to access the market by staying on top of policy work. Healthy competition is vital, but an unbalanced market concentration allows market abuse, which is averse to end customers. FIATA liaises with the US Federal Maritime Commission, European Commission, UN Center for Trade and Development Maritime experts, to bring transparency to market and business practices. Recently, the US-Federal Maritime Commission issued a Supplemental Notice of Proposed Rulemaking (SNPRM) containing its proposals on implementation of prohibition on common carriers, refusing available cargo space to shippers. The SNPRM has been issued following a consultation period and is a continuation of the FMC rulemaking process mandated by the US Ocean Shipping Reform Act, 2022. FIATA requests were considered in this update, which benefits its members.
Skilled workforce: Supplying a trained workforce to the industry through vocational training—FIATA diplomas are the heart of the FIATA industry training support, and FIATA continues to improve and evolve the courses as the industry needs change. The Dangerous Goods ICAO-FIATA Programme anticipates updates this year, and FIATA Young Logistics Professionals (YLP) Award, will again seek regional and global winners to promote the professionally conducted export/import of a chosen items. The federation delivers the validation and re-validation of training programmes to ensure that associations remain updated on the latest training trends and offering online courses on the prevention of wildlife trafficking.
Throw light on FIATA’s recent innovations and developments?
Digitalisation: Digitalisation means automation, use of Blockchain, and adoption of e-documents and collaboration, which will accelerate trade processes, save time, increase security, and improve sustainability in the logistics supply chain. In the 2022, FIATA launched the FIATA Digital FBL accessible to members, helping them save time and money, while bringing trust and security to their partners, in conformity with UNCTAD/ICC Rules and UCP 600 by ICC. Since then, 600 digital FBLs have been distributed, with 26 FIATA members and 23 software providers embarking on the digital journey. Several pilots were initiated in Autumn 2022, proving the interoperability of the digital FBL with carriers and customs, but also with trade finance banks, for example Arab Bank Switzerland. FIATA has contributed to the ICC Key Trade Document and Data Elements (KTDDE) brochure, which presents digital standards and data elements for seven key business documents, including the FIATA digital FBL, and provides a glossary of key business terms. By this year-end, FIATA plans to extend this project to 40 documents. FIATA also contributed to the ICC ‘Trust in Trade’ brochure, proposing a vision of the trade ecosystem based on verifiable and transitive trust.
Do you think collaboration with Indian associations such as FFFAI and others will prove to be beneficial?
I believe events such as FFFAI Diamond Jubilee will drive home the importance of international collaborations. The fact that the voice of freight logistics could take part in this event displays the beauty of collaboration and learning from one another. The FFFAI event attracted the Indian Minister of Commerce, which shows the value of freight forwarders not only to the national, but also global economy. At FIATA, we believe trade and transport facilitation is a global issue and cannot be reduced to single nation or regions. Without global trade, growth is hindered. Global cooperation, trade agreements and infrastructure development can facilitate linkage between all transport modes. FIATA works through its Institutes and Advisory Bodies together with the UN divisions to facilitate trade, build capacity, and standardise processes.
Where does trade with India stand presently? How do you look at India as a trade and investment destination?
Digital trade has improved in India in the past years, resulting in lower rates of corruption, and infrastructure investments. For example, take the 47-km Outer Ring Road in Delhi, which is improving the flow of goods in the country. India has a high investment success, resulting in better logistics processes and is based on new logistics possibilities. This leads to faster deliveries, connectivity, and great airport and port and infrastructure. Since my last visit to India, during the 2019 FIATA World Congress in Delhi, the country has changed a lot in just five years; it is spectacular!
With issues such as global recession and Ukraine-Russia conflict, how do you see global freight forwarding industry moving in the coming years?
The logistics sector has a special function in the economy, and I like to see new challenges as an opportunity, encouraging freight forwarders to think smart and not dwell on the difficulties ahead, but embrace the opportunities. International organizations give us knowledge and ideas as to what and how you can carry out your daily processes, through tools, best practices, webinars and more. This enables freight forwarders to stay up to date on how to manage new developments such as the digital transition, new developments in infrastructure, new freight corridors, and the like.
This knowledge enables competition amongst options, and modes of transport and allows working together and giving more opportunities to all. If you have a monopolised transport system, this can hurt the international economy, and FIATA continues to advocate for level playing field across the multimodal transport sector, by aiding Small and Medium Enterprises at the core of the logistics supply chain.
