As the Covid-19 crisis swept across the globe with restrictions on travel and trade resulting in closed ports and cancelled flights, it began to cause severe delays to the ordinary rotation of cargo vessel crews between their ships and home ports. It soon became clear that this was not just a liability for the commercial shipping sector, but also a growing humanitarian crisis for the thousands of seafarers who are the engine of global trade. To protect global supply chains and seafarers’ health and safety, we sounded the alarm calling for critical crew changes last year.
Over 400,000 seafarers remain stranded at sea, and many have been working for up to 17 months, much longer than the industry norm and the regulatory limit of 11 months. A further 400,000 seafarers remain ashore waiting to relieve them, often with little or no pay. The International Chamber of Shipping has estimated that the number of seafarers affected could soon reach one million if this issue is not addressed urgently.
This issue is presenting significant health and safety concerns to the already elevated mental and physical stress seafarers are facing and has the potential to result in major safety risks when exhausted seafarers handle dangerous or perishable cargoes. The environmental consequences of a serious maritime accident involving these cargoes could be catastrophic for our oceans and our security.
Urgent action
In an open letter to the United Nations, and in consultation with key marine organisations, a consortium of international investors representing US$2 trillion of assets under management, led by Fidelity, have called for urgent action to end this humanitarian crisis.
In the letter, the group reiterated the need to classify seafarers as “key workers” to enable them to continue to perform their essential services in a safe and secure manner. And as the most effective way to resolve this crisis, we are also calling for seafarers to have access to vaccines with immediate effect.
The consortium of fund managers collectively invests in every part of the shipping transportation value chain, including ship owners, logistics providers, management companies and charterers. Signatories include Achmea Investment Management, ACTIAM, Ethos Foundation, Lombard Odier Investment Management and MFS Investment Management.
Active engagement
Shipping is responsible for 90% of global trade and holds the key not just to a global economic recovery from the devastation of Covid-19, but to maintaining our current way of life.
In the open letter to the United Nations, we noted that any solution has to be premised on a multi-lateral approach aimed at facilitating seafarer movement while protecting local communities from re-infection risk.
As investors, we also have a responsibility with regard to the companies of which we are lenders or owners to raise our concerns and seek constructive responses. We will engage our relevant portfolio companies to communicate our expectations around these measures.