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Maritime Fairtrade interviews Baki Lee, director of PT Global Expo Management, organizer of INAMARINE, Indonesia’s largest tradeshow for the maritime and offshore industry.

 

What is your opinion of the current state of the Indonesian economy and the general job market?

Indonesia’s economic activity is gradually returning to normal, and COVID-19 infections are under control. The prediction for Indonesia’s growth in 2022 has increased from 5.0 percent to 5.2 percent, portraying strong domestic demand and exports. Private consumption is being improved by gains in employment, income, and confidence.

Despite global inflationary pressures and recession concerns, Indonesia’s economy increased significantly in the second quarter, demonstrating that the recovery trend is continuing and even strengthening.

What are some special trends and outlooks that you noticed about the Indonesian maritime industry?

As the largest archipelagic country in the world, the shipping industry is the infrastructure and
backbone of the life of the nation and state. Indonesia has a grand design to establish Sea Toll Programs to improve connectivity, by increasing the capacity of 24 seaports.

Currently, the competitiveness and share of cargo for the national fleet is still relatively low. The shipbuilding industry, which is actually very strategic because it has a long upstream-downstream chain, has yet to develop. The current port system only acts as a branch or branch of Singapore or other overseas ports. It is hoped that the construction of some big seaports can increase the competitiveness of national shipping in the future.

Specifically, how is the job market for the maritime industry doing?

The government has unveiled Indonesia Vision 2045, a long-term strategy that aims for Indonesia to have a GDP of US$7.3 trillion, ranking fifth or fourth in the world. For instance, it is anticipated that the maritime industry will contribute 12.5 percent of Indonesia’s GDP. If Indonesia is successful in achieving this aim, additional employment possibilities will exist.

Why do you think a career in the maritime industry is attractive?

With more than 12 million employees, the maritime sector is one of the most significant sources of employment for the Indonesian economy. As the sector develops in Indonesia, there is also room for further job creation.

What do you think are the top five well-paid jobs in the maritime industry?

Five of the best jobs: Oceanographer, naval architect, marine engineer, welding engineer and drilling engineer.

What is the starting salary for a fresh grad entering the maritime industry?

For a ship technician, starting salary is usually IDR4,804,236 and IDR40,573,749 net per month (US$322 to US$2,721).

What is your advice for a fresh grad wanting to join the maritime industry?

One of the fields of vocational education that has contributed to the acceleration of Indonesia’s economic recovery is the maritime sector. The success of this maritime vocational education is proven through graduates who really answer and meet the challenges of the international maritime world of work.

Fresh graduates who want to enter the maritime industry must be equipped with additional skills such as computers, presentation skills and problem solving in addition to mastering English.

Source: https://maritimefairtrade.org/guide-to-indonesias-maritime-industry/

AAL Shipping (AAL) has undertaken a salvage operation to remove two tugs from the Mersey River in Devonport on the north-west coast of Tasmania that had been sunk by a cement carrier in January. Chosen for the job was the 31,000DWT 700 tonne heavy lift vessel, the AAL Melbourne, and involved the lifting of the tugs and their onward shipment along the East Coast to Brisbane. New South Wales based emergency response, salvage and environmental support specialist, United Salvage, engaged AAL to supply a vessel from its longstanding ‘Asia to Australia East Coast Liner Service’.

The first tug, the 420 tonne York Cove, was carefully pulled out of the Mersey on Sunday 7th August by the AAL Melbourne using her two port-mounted cranes working in tandem – the tug having had large holes cut into her hull to allow trapped water and sediment to drain. The second tug, the 455 tonne Campbell Cove, was recovered and loaded onto the AAL Melbourne a few days later. Both tugs were securely lashed to the weather deck of the ‘mega size’ vessel in preparation for their onward shipment to Brisbane and utilising specifically designed cradles loaded previously in Burnie.

Chris Yabsley, Chartering Manager at AAL Australia, commented, “United Salvage originally planned to use a floating crane and barge to recover these tugs. However, once we demonstrated that our A-Class vessel could not only recover the tugs but also transport them back up the East Coast for delivery to Brisbane, it was clear that AAL would be the perfect partner.”

Nicola Pacifico, Head of Transport Engineering at AAL, explained, “The recovery was carefully planned and modelled over several months and involved collaboration with several key stakeholders including United Salvage, TasPorts and cargo insurers. Even the Australia Maritime Safety Authority (AMSA) was required to confirm our calculations with our ship’s class (DNV). Lifting took time as the tugs weighed significantly more than expected, due to trapped water and fuel. Working throughout the evening on the second tug, the full weight of the tug stayed on our ship’s cranes overnight – awaiting the salvage company to pump out whatever was still trapped inside her.”

Yabsley added, “As the proposed position of our vessel during the salvage operation impacted the swing basin for critical port operations needed to keep Tasmanian supply chains open, we worked closely with the Harbour Master and Pilots to avoid impacting other port movements. The removal of the sunken tugs allows Devonport to return to normal operations.”

TasPorts CEO Anthony Donald estimated that more than 100 people worked on the project. “We not only had the significant challenge of tide and weather, but also the natural eddies in the area and potential marine pollution,” he said. “TasPorts worked closely with EPA Tasmania, which had representatives on site to advise on environmental management. The insurers and salvors, that have extensive international experience, say it was one of the most complex salvage activities they have ever undertaken. The salvage itself was slow and deliberate and reflects the detailed and collaborative planning that was required to complete the operation successfully.”

Frank Mueller, General Manager of AAL Australia, concluded: “This operation would not have been possible with either a container or ro-ro vessel, which is ironic as in this period of extended port and terminal congestion across Australia, those vessels are being prioritised over MPP and general cargo vessels for port entry slots and our resulting waiting times are severe and imbalanced. It not only showcases the versatility of our modern heavy lift fleet and engineering capability but also demonstrates AAL’s commitment to the Australian market as, unlike other operators, we have serviced the region nonstop for over 25 years ­– making AAL an easy and obvious choice for United Salvage.”

Source: https://cyprusshippingnews.com/2022/08/23/aal-recovers-400-tonne-sunken-tugs-from-the-mersey-river-in-tasmania/

The heatwave experienced in parts of the world has seen temperatures of between 40 – 42C recently – and according to an article in TradeWinds, ‘Shipyard work has become nearly impossible in the sweltering temperatures and workers have had to take unscheduled breaks’ meaning that production has been delayed.

Many yards are therefore having to declare force majeure due to extreme weather and, whilst owners may push back depending on their particular wording, it is hard to see what the yards could reasonably do to alleviate the current conditions.

Missing the delivery date

Most shipbuilding contracts set an agreed “delivery date”, with liquidated damages payable to the buyer (via reduced purchase price) in case the yard misses the delivery date. They tend to contain a system for calculating a long stop date, on which the buyer gets a right to cancel the contract completely if the ship has not been delivered. Most shipbuilding contracts also contain a mechanism by which the yard can push back the contractual delivery date in case of certain types of delay. Typically, there will be “permissible delays”, which tend to include “force-majeure” type delays. Usually, a yard will be given quite a lot of lenience in being able to push back the contractual delivery date due to “permissible delays”, because these are seen as relatively excusable delays, as long as there is compliance with contractual provisions about giving notice of delay and mitigation.

Contracts typically also permit extensions for other delays, sometimes called “non-permissible” delays, but only to a limited extent, and again usually only if notice is given.

“Acts of God” or “weather conditions not included in normal planning”

The term “Act of God” is frequently used as a catch-all provision in force majeure clauses, such as Article VIII of the SAJ Form of shipbuilding contract (“the SAJ Form”). It has been defined in English law as “such an operation of the forces of nature as reasonable foresight and ability could not foresee or reasonably provide against”. If the yard wants an extension of the delivery date based on an “Act of God”, it must prove not only the impact of a natural phenomenon on the expected delivery date, but also that it could not reasonably have been avoided.

The extent to which mere extreme weather, as opposed to specified meteorological events such as storms or lighting strikes, can constitute an “Act of God” has not been finally settled by the English courts. But it seems likely that weather can constitute an “Act of God” if it is so extreme, judged in light of the usual conditions at the place of contractual performance, that the yard could not reasonably have been expected to take steps in advance to avoid it.

There is also no clear ruling on whether extreme heatwaves would be encompassed by the clause “flood, typhoons, hurricanes, storms or other weather conditions not included in normal planning” in Article VIII of the commonly-used SAJ Form”. Therefore whether or not a heatwave would count as a “force majeure” event under this clause will be a matter of fact and degree. The fact that it is relatively common for Chinese shipbuilding contracts to be amended expressly to include as potential “force majeure” delay any periods of time during which external temperatures at the shipyard exceed 35° may impact the interpretation of Chinese shipbuilding contracts, if those clear words have been left out.

Strikes at the yard

If workers actually down tools due to extreme weather, several types of shipbuilding contracts list strikes at the yard as a type of ”permissible delay” alongside other typical ”force majeure” events. For example, Article VIII of the SAJ form provides for delays due to strikes to count as ”permissible delays” if “at any time before the actual delivery, either the construction of the vessel or any performance required as a prerequisite of delivery of the vessel is delayed due to…strikes, lockouts or other labour disturbances”.

It will usually be open to the buyer to try to argue that the relevant delaying event did not trigger a “permissible delay” under the shipbuilding contract, because the yard has acted unreasonably. This is because English law usually requires a person seeking to rely on a “force majeure” clause to show they took reasonable steps in advance to avoid the impact of a “force majeure” event and to mitigate its effect.

For example, in a strike situation, the buyer could argue the yard has been unreasonable in its dealings with its workforce i.e. the strike was not in fact outside the yard’s control. The courts have been sympathetic to arguments like that. E.g. in Channel Island Ferries Ltd v. Sealink Ltd (1987) the yard was entitled to rely on a force majeure exception of strikes only if there was nothing it could reasonably have done to avoid the strike or to mitigate its consequences. For this reason, the type of strikes capable of generating force majeure delays and qualifying as “permissible delays” under shipbuilding contracts will tend to be those affecting the whole or a substantial part of the shipbuilding industry in the country of construction, rather than just the particular yard in question.

Hints and Tips

Yards have often come off badly before the courts in the case of delays. They would do well, therefore, to document and claim delays arising from the current extreme conditions, including:

Claim for permissible delays as they arise, and make sure records of delays supported by critical path analysis are kept.

Comply with all formal notification provisions under the contract.

Keep a record of how the conditions have impacted work at other yards, and even how they have impacted other industries, in the region.

Keep a clear record of what has been done to try to overcome delays, in an effort to demonstrate that the yard has acted reasonably.
Source: Reed Smith Global Solutions By Reed Smith shipping lawyers Thor Maalouf, Sally-Ann Underhill and Lianjun Li