UKMPG had the opportunity last week to spend a few days with port operators and logistics companies in the USA. We were there as part of a UK trade delegation representing UK ports and the maritime sectors excellently facilitated by the UK Consulate in Atlanta and Embassy in Washington DC. In the margins of the ‘buy British’ efforts the visit also provided a great opportunity to compare notes with US peers. There are some strong areas of common experience, some interesting areas of difference and some instances of how, sometimes, you have to go far away to appreciate what’s up close.
Major ports and logistics players on both sides of the Atlantic have the sense that blockchain and related data applications will play an important role in the supply chains of the future – a picture you probably wouldn’t have got even 12 months ago. But there is a search for the compelling business models to drive application, especially relative to the implementation challenges.
Problems with infrastructure connectivity are a widespread issue. But it’s not just the availability or physical condition of rail freight paths and road junctions that is the concern. There are also common key problems in human infrastructure capital – a lack of truck drivers and competing demands and expectations surrounding the current diminishing talent pool.
Increased autonomy – vessels, port operating assets, trucks amongst others – was a frequent conversation topic. But a lot of the discussion was around the potential for increased automation to augment human operation and drive productivity, rather as a full replacement for it.
Areas of difference
US major ports share with their UK peers the ability to be major catalysts for growth and jobs in their surrounding hinterland regions. US ports, and their partner local development agencies, have more levers available to incentivise development because of the greater decentralisation of tax and spend in the US. Also, the US ports areas we visited had also benefited very positively from the use of ‘free trade areas’.
‘Inland ports’ featured in the strategic plans of the US ports we met. Essentially dedicated inland railheads for unitised freight, they allow US ports to mitigate some connectivity issues, such as constraints on truckers and local road bottlenecks. There might also be potential to extend the free trade area concept. But the differences in scale and distance in the US probably make this more of a viable idea than in the UK.
Large US port operators share with their UK peers a determination to be better neighbours. However, it was striking that they faced less concentrated pressure on environmental performance, particularly on air quality, than many UK ports.
The perspective that distance can bring
Spending time with US peers brought home how much we have in common and the areas of complementarity. It felt like our respective ports and maritime sectors should form a foundation of a successful future trading relationship and Free Trade Agreement between the UK and the USA.
As well as ports, the trade mission included some fantastically innovative UK companies with products and services linked to the ports and logistics sectors. Spending time with these companies not only allows you to appreciate the amount and quality of innovation going on around the ports sector, it also gives the space to challenge your own thinking of what’s possible and what the future might hold.
The ports sector is a fantastic community, and that extends overseas too. People are willing to share and learn with each other, appreciate their different perspectives with respect and humour, and smile ruefully together over the common challenges. And, importantly, be generous hosts. So, if anyone’s looking for a BBQ or craft beer recommendation in the South East of the USA I’m now in a position to help!
Source: UKMPG, February 2018