U.S. ratification of UNCLOS is key to sustaining competitiveness of U.S. shipping industry
The convention promotes the freedom of navigation and overflight by which international shipping and transportation fuel and supply the global economy. By guaranteeing merchant vessels and aircraft the right to navigate on, over, and through international straights, archipelagic waters, and coastal zones, the provisions of UNCLOS promote dynamic international trade.
[ Page 2 ]
It’s no surprise then that ratification of the Law of the Sea Treaty is a priority for many of the NAM’s members. Its adoption is critical for manufacturing competitiveness in the United States.
While my testimony will focus primarily on mineral development on the deep seabed, that is not the only reason for the urgency in adopting this treaty.
In today’s global economy, exports are more important than ever. Ninety-five percent of the world’s consumers live outside the United States, so reaching these potential customers is critical for manufacturing competitiveness.
This treaty will secure international lanes of commerce and ensure that manufacturers can export their products efficiently. It protects our sovereign interests and promotes international commerce.
Secure shipping lanes are a priority for NAM members. Last year, cargo ships and other ocean liners carried $570 billion of U.S. exports. Discounting our exports to Mexico and Canada, which travel by rail and truck, this total accounts for more than 50 percent of our exports by value and more than 90 percent of our exports by weight.
[ Page 5 ]
Mr. Chairman and members of the committee, freedom of the seas and rights of innocent passage are not theoretical concepts. These are critical aspects of the Law of the Sea Convention and ones that we rely on for the effective operation of our industry. We are very concerned with protection of those rights. Both US flag ships and ships owned or operated by American companies are impacted by international events. We rely on our nation to be actively involved. The U.S. should place itself in the most effective position to be a force for adherence to treaty obligations by all. We can do this by acceding to the treaty.
My members operate in the international maritime world. We benefit from a consistent application of the rules that we have to follow. There are certainly fewer ships flying our flag than in years past although that does not mean we are less involved as a nation. The latest figures we have seen place the United States as the sixth largest shipowning nation in the world. In recent months, we have seen actions by companies that will lead to more American seafarers serving on ships that fly the flags of other nations. Clearly we have a lot at stake.
[ Page 55 ]
Another key mission of the Coast Guard is to promote safe and secure international trade. The convention promotes freedom of navigation and overfight, by which international shipping and transportation fuel and supply the global economy. Some 90 percent of global trade tonnage, totaling more than $6 trillion in value including oil, iron ore, coal, grain, and other commodities, building materials, and manufactured goods, are transported by sea every year.7
Currently, little international trade travels through the Arctic, but this is changing and will continue to increase in the decades ahead as the ice cover continues to recede and marine transportation technology advances. Moreover, there is considerable destinational shipping even now, such as to bring critical supplies to the North Slope and Alaskan coastal villages, and to remove vast amounts of minerals from the treasure trove in the Brooks Range in northwestern Alaska.
By guaranteeing merchant vessels the right to navigate through international straights, archipelagic waters, and coastal waters, the provisions of the convention promote dynamic international trade. Free navigation reduces costs and eliminates delays that would occur if coastal states were able to impose various restrictions on navigational rights.
[ Page 3 ]
Being a member of the Convention will help to simplify this complex maritime environment both for our military forces as well as our commercial partners who have played a critical role in developing new routes for transporting DOD cargo and in enabling access to a vast global infrastructure for transport of DOD cargo. More than 90 percent of all military supplies and equipment are transported around the world by sea, much of it by commercial vessels. This Convention provides important legal support for our commercial partners who transport our cargo, unescorted by U.S. warships, under the legal regimes of the Law of The Sea Convention. Without codification of those rights, our commercial partners are at greater risk.
[ Page 9 ]
The convention promotes the freedom of navigation and overflight by which international shipping and transportation fuel and supply the global economy. Some 90 percent of global trade tonnage, totaling over $6 trillion in value, including oil, iron ore, coal, grain, and other commodities, building materials, and manufactured goods, travels on and over the world’s oceans and seas each year.12 By guaranteeing merchant vessels and aircraft the right to navigate on, over, and through international straights, archipelagic waters, and coastal zones, the provisions of UNCLOS promote dynamic international trade.
At the same time, UNCLOS encourages international cooperation to enhance the safety and security of all ocean-going ships. Whether it involves lumber and winter wheat shipped from the Pacific Northwest to Japan; high-quality, low-cost goods from Singapore to Long Beach; or oil from the Persian Gulf to Europe; free, safe, and secure commercial navigation and flights provide great economic and security benefits to all of us. That is the key reason the U.S. Chamber of Commerce, shipping industry, aviation industry, and other international trade groups have called for immediate accession to the convention.
[ Page 3 ]
As a nation with global maritime interests, the United States has consistently viewed the UNCLOS provisions on freedom of navigation on the high seas and in exclusive economic zones (EEZs), “transit passage” through straits used for international navigation, and “innocent passage” through territorial seas as the convention’s essential core.12 Although UNCLOS’ navigation provisions were not designed with the Arctic in mind per se, the provisions are consistent with the United States’ interest in freedom of navigation in and through the Arctic.13
Although experts differ on the imminence and extent of regular Arctic transits, some scientific studies suggest that increasing temperatures will result in a seasonally ice-free Arctic as early as the 2030s.14 As the ice recedes, many expect the opening of more expeditious travel routes,15 with consequences for international security and commercial activities.16 In particular, two trans-Arctic routes are expected to become increasingly critical: the Northwest Passage and the Northern Sea Route.17
[ Page 11 ]
First, the policy statement highlights the importance to our national security of navigation rights through international straits in the Northwest Passage over North America and the Northern Sea Route over Russia's northern border.33 Military and commercial navigation through those straits will become more important-and perhaps more contested-as the Arctic sea ice recedes and thins. Part III of the LOS Convention on straits used for international navigation includes twelve detailed articles that address the status of such straits, the right of transit passage, and the rights, responsibilities, and jurisdiction of states bordering on those straits. Although a right of transit passage through international states almost certainly ripened into a rule of customary law by the time the LOS Convention entered into force in 1994 (and before Canada became a party to the Convention in 2003), it seems certain that the customary law rule is not nearly as well defined as the articles in Part III of the Convention. Only as a party to the Convention would the United States be in a position to assert the full scope of the navigation rights set out in Part III of the Convention.
[ Page 202 ]
One commercial navigation voice raised during the committee hearings was that of the Chamber of Shipping of America (CSA), an association of U.S. vessel owners and op- erators of U.S. and foreign-flag ships. CSA president Joseph Cox made the case for accession based on environmental and freedom of navigation principles. Remaining outside the Convention, cautioned Cox, put U.S.-based shipping interests in jeopardy of being burdened by coastal state regulations that have been “stretching the interpretations of the law of the sea into unrecognizable forms.” Cox referred specifically to recent actions taken off the coast of western Europe. He derided the forcible removal of the Prestige in 2002 from the exclusive economic zone of Spain when it developed a hull fracture and sought entry into safe waters. " Cox also criticized a recent designation of a large expanse of ocean stretching from the “upper reaches of the English Channel to the Straits of Gilbraltar [as] a particularly sensitive sea area [(PSSA)].” " While coastal states may designate PSSAs pursuant to International Maritime Organization principles, acknowledged Cox, he contended the designation in this instance was unsubstantiated. "
[ Page 2-3 ]
The Law of the Sea Convention establishes a legal framework that has direct impact on the American shipowning community and all Americans. In 1914, the maritime world was a comparatively simple one; ships flying a particular flag were manned by nationals from that nation, were insured there and classed by the national class society. They were most likely built there and had equipment manufactured there. The traditional law of the sea was also simple to apply. Today, the situation is more complex. Ships owned by one company can fly the flags of several different nations, employ crew from various nations with mixed crews being more prevalent than single-national ships, be classed by any one of a number of societies, be insured in any number of venues and have a multiple of other international mixes involving equipment and building. This situation has evolved in response to the needs of the industry to increase efficiency. As we have increased our efficiency, we have provided a lower and lower cost service to our customers. Our customers are the shippers of the world and their customers are the consumers. Over ninety-five percent of the goods shipped into and out of the United States go by sea. On average, four hundred ships a day, from literally all flag nations of the world, arrive in U.S. ports. The people of the United States have benefited from the actions of the maritime industry and we in the industry have benefited from a uniform legal framework. One consistent comment we make to the Congress, and the various legislative bodies around the world is that we need to have a uniform set of rules to follow. If each nation develops their own rules or interprets existing regulations in a manner substantially different from others, chaos exists for the maritime community. The United States has consistently responded to creative interpretations and has taken the lead in developing rules that meet U.S. needs and the needs of other nations. The world looks to our leadership in these matters and we have responded vigorously and positively to that expectation. The credibility of the U.S. in international fora where these agreements are made depends on it.