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Tuesday, 26 November 2019
On occasion, life has a habit of appearing to imitate art.
Both Beckett’s ‘Waiting for Godot’ and Kafka’s ‘The Castle’ are now widely being considered as contemporary literary representations of the UK’s tortured Brexit process. Both works are underpinned by the themes of frustration and absurdity, with the protagonists seemingly waiting endlessly for an outcome which has been promised and sought for a long time, but the outcome always seems to move further out of reach.
Such is the case with Brexit, whose outcome now awaits the outcome of the UK’s election and subsequent passage (or not) of legislation enabling the deal struck by the UK government for an exit on 31 January 2020 (or another extension).
The costs are adding up - and governments are raising the issues at the WTO
While much will depend on the outcome of the UK election, the financial and business fallout from the failure to date to implement Brexit has already started.
According to a BBC World Service report of 15 November 2019, 15 countries (including the US, India, New Zealand and Australia) already have set out Brexit concerns at a WTO meeting in Geneva, seeking compensation from the EU and the UK for Brexit disruption. Australia’s position was that beef and lamb exporters had been significantly disadvantaged through the various Brexit delays, largely around uncertainty on tariff rate quotas. At the moment, the current quotas are for the whole of the EU (including the UK), but there is no certainty of the post-Brexit quotas for the to-be-two regions. Sales to Europe are more profitable, but may be reduced in favour of less-profitable sales in the UK. Compensation to be provided could be in the form of reductions in tariffs for other goods.
The report suggested that Australian exporters had ceased exports ahead of earlier Brexit deadlines causing a loss of business, which would happen again before the 31 January deadline unless certainty was provided.
So in the current circumstances, what should Australian businesses expect?
What are the likely effects on Australian importers and exporters?
In the absence of any certainty over the timing or nature of Brexit, the question remains whether we can predict the future effects of Brexit on Australia. As the manner of Brexit remains uncertain, then the exact consequences are uncertain. However, I can make the following observations:
• The terms of the exit will dictate what procedures will need to be followed. A ‘no deal’ Brexit on 31 January 2020 will lead to different outcomes to a scenario with an amended withdrawal agreement and a transition period during which current arrangements are likely to apply.
• Many Australian companies either use the UK as a base to enter the EU or use the EU to enter the UK market. Either way, the current convenient arrangements for movement of goods, services and employees between the EU and the UK could be cancelled or varied. Australian companies that have established a company or operations in the UK may be entitled to the benefits of certain streamlined procedures made available by the UK government.
• The delays and uncertainties of Brexit have a major impact on our ability to negotiate a free trade agreement with the UK or to conclude discussions on proposed new visa arrangements. However, a scoping study is well advanced and those affected should engage with the study through the Department of Foreign Affairs and Trade (DFAT).
• Our current trade negotiations with the EU may well be affected by the uncertainty of just which countries will be in the EU. However, all signs are that negotiations are advancing at speed at the moment.
• There will be legal issues in having to manage border controls between the UK and the EU where there have not been border controls for many years. Australian companies will need to separately document entry to and departure from the UK and the EU, which has not happened before. There will potentially be different standards in both markets for all manner of goods and services, although new Mutual Recognition Agreements will assist. There will probably be different quarantine obligations and different obligations to pay Customs duties, VAT and other clearance fees.
• The UK has now created its own ‘trade remedies’ regime so there could be dumping and countervailing duties imposed on Australian goods exported to the UK that are seen to cause material injury to UK industries.
All of this also creates multiple new compliance obligations keeping in mind that political assurances rarely translate into legal protections. Resources and planning are vital.
Resources and planning.
The best advice I can provide at the moment is to prepare for Brexit but remain informed from reliable sources.
• Do a proper assessment of your business and what parts will be affected by changes to the movements of goods, services and investment.
• Communicate with customers, suppliers and service providers in the supply chain as to their plans to co-ordinate plans and minimise disruption.
• Check contracts to see if they allow for changes to prices, delivery dates and charges. Will they allow for flexibility? Could Brexit be a ‘force majeure’ allowing termination of the contracts? Early and open discussions would assist and variations to agreements could be required.
• Include ‘contingency arrangements’ in deals now being negotiated.
• Government and its agencies have provided significant resources. DFAT (https://dfat.gov.au/) and Austrade (https://www.austrade.gov.au/) are providing assistance as are the UK government’s Department of International Trade and the Department for Exiting the UK,, the EU’s Preparedness Notices and even the NZ government through a dedicated web presence (here).
• The Financial Times is a good source of reliable information and worth the financial investment to receive its daily electronic updates.
• Stay tuned to commentary in the DCN and other trade journals.
• Secure legal and commercial advice here and overseas.
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Tuesday, 26 November 2019
Ongoing issues affecting some Rolls-Royce engines on Air New Zealand’s B 787-9 aircraft have forced the carrier to make changes to its Sydney and Perth, Australia schedules.
Rolls-Royce requires operators of its Trent 1000 TEN model engines to carry out more frequent maintenance due to an issue with the engine’s high-pressure turbine blades. Rolls-Royce does not have any replacement engines available while maintenance work is undertaken and has advised Air New Zealand there’s a significant wait for repair services.
Air New Zealand has 10 Trent 1000 TEN engines on its 787-9 fleet and has been working to minimise disruption, but schedule changes are now unavoidable. Further changes may also be required as the airline progresses the engine checks.
The biggest change so far is the suspension of its twice-weekly seasonal Christchurch-Perth service, resulting in the cancellation of 62 flights.
The airline will also cancel its second daily Auckland-Perth service from 10 December 2019 until 05 January 2020. It will continue to operate its 11:10 hrs Auckland-Perth and 18.50 hrs Perth-Auckland services as scheduled.
As well as the Perth route, cancellations will also take place from 10 December-02 January, mainly on Auckland-Sydney and Sydney-Auckland flights.
Air New Zealand senior fleet manager 787 captain Dave Wilson says the airline has been performing regular precautionary checks on its TEN engines since April and has been doing all it can to fast-track required maintenance from Rolls-Royce.
“Based on the maintenance needs of our engines, we expect some will need to be inspected in December and January and then serviced by Rolls-Royce offshore and unfortunately, Rolls-Royce has no capacity to alleviate this pressure.
“We have 14 787-9 aircraft in our fleet and four spare engines to power them. However, all these spare engines are with Rolls Royce offshore either undergoing service or waiting for a service slot.”
There is no impact to the airline’s 22 Trent 1000 Package C model engines as a result of this HPT blade issue.
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Tuesday, 26 November 2019
CT scanners have been used for years at airports to screen checked baggage, but now advanced systems are being introduced at security checkpoints.
GlobalData has examined the sector’s investment in CT technology and its impact on security lines.
It’s been 13 years since UK police uncovered a terrorist plot to attack transatlantic flights using peroxide-based liquid explosives. The foiled plan, which led to 24 arrests and nine convictions in the UK on conspiracy charges, created further restrictions for passengers moving through airport security.
In the immediate aftermath, these restrictions were particularly severe, especially in the UK, where all non-essential cabin luggage was prohibited and even approved items could only be taken through security in clear plastic bags.
Today, security restrictions for carry-on luggage have eased significantly, but one major legacy has endured at most international airports around the world – the requirement that liquids be kept in 100ml bottles and placed in clear plastic bags before being scanned. In most cases, electronic kit such as laptops must also be removed from bags and scanned separately.
However, this may not be necessary for much longer, according to GlobalData, which says new miniaturised CT scanners will be game changers. Computed tomography (CT) scans use computer processing to combine hundreds of individual X-ray measurements from different angles to create a 3D image, so that the object being scanned can be rotated and examined on screen.
Medical imaging is the predominant application of CT technology, but it’s not new to airports – CT scans are commonly used to inspect checked luggage bound for plane belly holds. However, the size and expense of CT systems has previously prevented thembeing used at space-constrained passenger security checkpoints.
But now, manufacturers such as Analogic Corporation and Smiths Detection have started to make CT scanners in checkpoint-friendly sizes, and major trials and deployments around the world is tipped to introduce the new technology to security lines.
GlobalData deputy managing editor Chris Lo said: “Being able to move through security without the faff of separating liquids and electronics from bags is exciting for passengers, and there are important operational benefits for airports as well. More precise baggage screening provides a clear security benefit, but could also increase throughput by requiring fewer additional manual bag checks.”
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Tuesday, 26 November 2019
SEXUAL harassment scandals continue to claim the headlines, implicating business and political leaders as well as movie directors, but for some Australians, workplace sexual harassment is a daily reality.
Findings from the 2018 Australian Human Rights Commission fourth national report on the prevalence, nature and reporting of workplace sexual harassment in Australia found a staggering one in three (33 per cent) of working Australians had experienced sexual harassment in the workplace in the past five years. The most commonly-experienced type (19 per cent) was sexually suggestive comments or offensive jokes.
Senior employment relations adviser Isabella Zamorano says no workplace – big or small - is immune to sexual harassment: “It’s time for those at the top of every business including small business owners, to take strong action against sexual harassment.”
According to Zamorano, it is unfortunate that it takes news headlines and important research reports such as these to spark “necessary dialogue about the implications of unwanted sexual advances in the workplace and extensions of the workplace.
“The matter highlights that at all levels of professions and in industry, sexual harassment is a risk and cannot be taken lightly – not only for the victims but for the businesses that risk reputational damage and disruption.”
Zamorano urged businesses to be proactive in dealing with sexual harassment. “Don’t wait for a crisis, act now.”
According to Zamorano, there are four key activities employers can take to proactively stamp out sexual harassment in the workplace.
Zero tolerance
“If you haven’t already, formalise a zero-tolerance stance on sexual harassment in your policies and procedures. With your position clearly defined, articulate it to employees through every communication method available to your business. Every staff member — both incoming and existing — should be aware of your company’s policy on sexual harassment, and how sexual harassment is defined in your workplace.”
Staff training
“While your sexual harassment policy can outline the standards of acceptable behaviour and conduct, training will help your employees retain the information and speak up to report incidents. Employees come from a vast range of backgrounds, beliefs, cultures and ages. Training sets out in very clear terms the type of behaviour that is unacceptable in the workplace.”
Making complaints
“Making a claim of sexual harassment can be daunting and deeply personal. Often, victims stay silent out of fear that it will harm their careers or label them as troublemakers. It’s important that employees are aware of the process to make such complaints, and that their information and details will be treated seriously and confidentially.”
Investigate claims
“It is up to victim whether they consider a particular incident as a form of sexual harassment. Even if the incident took place out of hours, outside your workplace – or even if you don’t find the accusation personally offensive – all claims must be properly investigated.”
Zamorano said: “Sexual harassment is set to take greater prominence in the world of employment relations and it’s important that you have the relevant policies and procedures in place to protect your people and your business.”
“It’s time for business leaders to be proactive and lead the path to change,” she said.
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Tuesday, 26 November 2019
CHANGI Airport Group (CAG), together with the Civil Aviation Authority of Singapore, Enterprise Singapore and Workforce Singapore, will be supporting the air cargo community – with dnata Singapore and Singapore Airlines as pioneer members – to achieve the International Air Transport Association’s (IATA) Centre of Excellence for Independent Validators for Perishable Logistics (CEIV Fresh).
The four parties will co-fund certification costs, with the aim to strengthen Changi’s capabilities in the handling of perishable cargo. SAAA@Singapore is the program manager for the CEIV Fresh certification process.
The community is the first in Southeast Asia to undergo the CEIV Fresh certification. SATS will also pursue the CEIV Fresh certification for its network, to complete by April 2020.
The aim of the enhancement of the community’s perishables handling capabilities is to instil greater confidence in shippers to use Changi Airport as a preferred hub for their time and temperature-sensitive shipments.
Perishable cargo represents about 13 per cent (by volume) of Changi’s total air exports and imports, and has been one of the key drivers of Changi’s cargo growth for the past few years. The top cargo markets for perishables to and from Changi are Australia, Norway and India.
At the same time, the nine pioneer IATA CEIV Pharma-certified members of the Pharma@Changi initiative, launched in October 2017, have renewed their commitment to jointly pursue the best standards in pharmaceutical handling, as well as to promote Changi Airport as a trusted and reliable pharmaceutical air cargo hub in the region. The community recently welcomed Kuehne + Nagel Singapore as a member of the group.
Inaugural workshop
CAG also organised an inaugural digital air cargo design sprint workshop involving more than 30 companies including airlines, freight forwarders, trade associations, cargo handlers and government agencies.
The Changi Cargo DiGi-CO (themed Connect, Community, Collaborate, Co-create) Workshop enabled key stakeholders from the local air cargo community to come together to jointly discuss issues the air cargo community is facing.
The goal is to facilitate digital collaboration to improve operational efficiency and productivity, and to enhance supply chain visibility for Changi Airport. Community-selected use cases will undergo rapid prototyping and field testing with industry partners.
Lim Ching Kiat, CAG’s managing director of Air Hub Development said: “Although the air cargo industry has slowed down globally, it is now even more important for the Changi air cargo community to be connected and to build a stronger partnership through collaboration. As a community, we can leverage synergies and co-create new solutions. This will enable the Singapore air cargo hub to strengthen our competitive edge and better serve our customers globally.”
For the first nine months of 2019, Changi Airport handled 1.49 million tonnes of airfreight.
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Tuesday, 26 November 2019
AIRPORTS Council International (ACI) World has emphasised the importance of collaboration among aviation stakeholders to address the challenge of accommodating future air service growth while remaining safe, secure, sustainable and customer-focused.
Angela Gittens, director general ACI World addressed aviation executives at the 4th World Aviation Conference on how strengthened collaboration can provide solutions to some of the most pressing challenges facing the aviation industry.
“According to the ACI Annual World Airport Traffic Forecasts (2019–2040), global passenger traffic demand will double by 2037, based on a projected growth rate of 3.8 per cent a year,” she said.
“The demand drivers are there. The question is, will we be able to accommodate the demand so we can deliver the socio-economic benefits of growth?”
Delving into specific pressures felt by the industry, Gittens highlighted the need to safeguard non-aeronautical (commercial) sources of revenue, secure infrastructure financing, increase efficiency via technological innovation and the importance of fighting climate change via environmental stewardship.
“Aeronautical revenues do not fully cover capital and operating costs, and airports rely on non-aeronautical revenues for their financial viability,” she said. “World wide, retail concessions remain the leading source of non-aeronautical revenue for airports.
“In the short-term, we’ll need to be mindful of the current and emerging disruptions in the wider world on some of these key sources, such as e-commerce and the sharing economy, and work together to find new business models that evolve in step with wider trends and passenger expectations.
“This is directly relevant to an airport’s bottom line and the ability to finance and expand infrastructure to meet growing demand for air transport.
“As the world travels more, the need for new and improved infrastructure will continue to rise.
“Where governments cannot incentivise continuous investments in the airport sector, private investment has become an important vehicle for the sustainable development of aviation.
“We need to work together and explore different financing solutions.”
Recognising that the rapid emergence of new technologies can lead to a new way of looking at airport capacity challenges, ACI has been developing two distinct initiatives paving the way towards the future together—New Experience Travel Technologies (NEXTT) and Smart Security.
“Indeed, all stakeholders in every area of airport operations must become more responsive and efficient,” said Gittens. “Both NEXTT and Smart Security bring technological innovation to the heart of aviation, seeking to ensure that all stakeholders have a common direction.
“Aviation is an ecosystem, a complex network of interconnected systems. But we also function within a global environmental ecosystem on which we depend. We must all ensure that we grow sustainably and increase our efforts to reduce our impact on the environment.
“Every sector of our industry is committed to this cause and we must continue to work together to diminish aviation’s contribution to climate change.”
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Thursday, 05 September 2019
DUBAI is handling increased pharma cargo including vaccines and medications for life-threatening diseases.
Since 2017, there has been an increase of seven per cent in the volume of pharma cargo transported during the summer months and an increase of 14 per cent in the overall volume of pharmaceuticals transported throughout the year.
This summer season alone, over 190,000 kilos of pharma travelled every day through Dubai.
In total, Emirates SkyCargo moved over 150,000 tonnes of perishables and 27,000 tonnes of pharmaceuticals through Dubai between the beginning of April and mid-August 2019.
Over the past three years, Emirates SkyCargo has positioned its Dubai hub as an efficient and rapid transit point for cargo from and destined for a variety of cities across six continents.
It has also transformed the perception of Dubai in the minds of global cargo customers from a transit stop to be avoided in summer because of high temperatures to a preferred state-of-the-art point of connection to markets around the world.
The carrier has invested in developing modern and ‘fit for purpose’ infrastructure at its Emirates SkyCentral DXB and DWC cargo terminals for cargo from passenger and freighter aircraft respectively.
This includes extensive cool chain facilities and dedicated storage space for pharmaceutical cargo. With a combined capacity of over two million tonnes of cargo per annum, the terminals see movement of close to 5,000 shipments and over six million kilos of cargo per day including during the summer season.
The carrier’s operations in Dubai, including its state of the art dedicated pharma facility at DXB, its freighter terminal at DWC and the connecting bonded trucking corridor between the two airports are certified for EU GDP norms.
The carrier has also enhanced the protection for pharmaceutical cargo from origin to destination by working with local ground handlers as part of its pharma corridors initiative. Earlier this year, it inaugurated a new ‘purpose built’ pharma facility at Chicago airport. Chicago is one of the airline’s most important pharma stations globally for both exports and imports.
Connecting people and food
Every day, around 1,100 tonnes of food and other perishable products originating from different parts of the world move through terminals in Dubai. This summer, there was an increase of close to 6,000 tonnes in the total quantity of perishables passing through compared to 2017. Close to 35 per cent of perishables arriving at Dubai are destined for the UAE, with the rest travelling on to reach global consumers.
For example, the carrier uplifts specialty food produce from Italy including Parmigiano Reggiano and Bufalo Mozzarella cheese from Rome and Naples, Vignola cherries and kiwi fruit from Bologna and Modena, plus strawberries, fish and clam from the Venice area.
In 2018, Emirates flew close to 3,000 tonnes of perishables just from Italy to the Middle East, Australia, New Zealand and other destinations in East Asia.
The carrier also helps local economies through the facilitation of exports of sea food. Since the start of its service to Santiago, Chile, it has carried over 4,000 tonnes of Chilean salmon equating about 20 per cent of the total volume of salmon exports to Asian destinations.
One of the points of origin for perishables is India. Every month, around 4,000 tonnes of fruit, vegetables and other perishables come from there. Produce exported includes summer fruits such as mangoes and guavas and vegetables such as okra, drumstick and chillies. Since May 2019, Emirates has moved 18,000 tonnes of perishables from India alone.
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