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Assessment Cover Sheet

Complete and attach this cover sheet to your assessment before submitting

Assessment Title Portfolio: Assignment 2

Programme Title: BILM

Course No.: TL7202

Course Title: Maritime Shipping Systems and Practices

Student Name: Hadeel Ali

Student ID: 201400606

Tutor: Leon Clark

Due Date: 6 May 2017 Date submitted: 13 May 2017

By submitting this assessment for marking, either electronically or as hard copy, I confirm the
following:
 This assignment is my own work
 Any information used has been properly referenced.
 I understand that a copy of my work may be used for moderation.
 I have kept a copy of this assignment

Do not write below this line. For Polytechnic use only.

Assessor: Date of Marking:

Grade/Mark:

Comments:
Portfolio: Assignment 2
Submission Date: 6 May 2017 (via Moodle, Turnitin)
Weighting: 15% (marked out of 100)
Type: Individual
Word Count: 1500 words +/- 10%

Learning Outcomes:
2. Evaluate the changing role and characteristics of ports and port operations as part of integrated
multimodal solutions for supply chain management, including the interplay between the revolutions in
containerisation and information technology and the subsequent impacts upon shipping systems.
3. Analyse the strategic importance of the Gulf States in the conduct of contemporary international
maritime freight services.

Assignment background:
‘In 2004 the Bahrain-US Free Trade Agreement (FTA) was signed on September 14, and came into force on
August 1, 2006.

Bahrain is the first Gulf Cooperation Council member and third Arab country to enter into a free trade
agreement with the U.S. The FTA between the Kingdom of Bahrain and the United States is an
international agreement that seeks to promote increased trade between both the countries.

The agreement outlines the duties and obligations of both countries in the elimination of trade tariffs on
imports and exports. It further aims to liberalize other conditions of trade in goods and services between
Bahrain and the US’.

Bahrain’s overall objective for the FTA is to facilitate trade flows, stimulate inward flows of investment,
expand key manufacturing and services sectors, and encourage the exchange of expertise to create
employment opportunities and stimulate economic growth in Bahrain.

Bahrain Customs Affairs. (2016, Sept 28). Retrieved from http://www.bahraincustoms.gov.bh/fta.php

Assignment task:
You are a Customs Clearance Officer at the Khalifa Bin Salman Port, dealing with clearance procedures
for international shipments from all around the world. The Minister of Interior has asked you to
evaluate the benefits and drawbacks of the Bahrain-US FTA in comparison to non-FTA shipments.
Write a report illustrating a comprehensive SWOT analysis of the Bahrain-US Free Trade Agreement
(FTA) from a Ports and Maritime perspective in comparison to non-FTA shipments.

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Your assignment should be written on this document (a Microsoft Word document - do not PDF the file) and
appropriately formatted; headings and subheadings should be used, you should use either Calibri or Arial font
(size 11 – excluding headings and subheadings), your work should be double-spaced and pages should be
numbered. Remember to reference your work (including in-text referencing) at all times using the APA format.

Submissions – Use this document as the template for your submission! Please submit the whole document
including cover page, instructions, your report and the rubric via Moodle. All assignments will be checked for
plagiarism and originality using Turnitin. All submissions must be saved using the following naming convention
(failure to do this may result in your assignment not being marked):
 First Name_ID number_ Assignment Part 1
 E.g. Ahmed_20109090_Assignment Part 1

BILM Assignments – Rules & Guidelines

ACADEMIC INTEGRITY & HONESTY: When submitting this assignment you are confirming that you have
adhered to Bahrain Polytechnic’s policy on academic integrity and honesty including using APA referencing
appropriately. Any violation of this will be dealt with as stipulated in the policy.

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after the due date. For example, an assessment which has been graded as 73% will be reduced to 68% for the
first 24 hours late, and to 63% if late for a further 24 hours and so on. This applies to every day of the week
including the weekend and all public holidays. Assignments which are submitted so late as to receive a
negative mark will receive a final mark of zero.

EXTENSIONS: On application, in writing, tutors may approve an extension up to a maximum of two (2) days
(including the weekend and public holidays) for an individual assignment. Applications for extensions must be
received no later than 72 hours (3 days) before the due date. Only one extension per course will be given.
Please note that extensions will not be given for group work, tests or exams.

WORD LIMIT: All assignments have a required word limit which we permit a variation of +/-10%. For example
an assignment with a 3000 word limit means that you can submit between 2700 to 3300 words. These words
come from the main body of your writing i.e. your introduction to your conclusion. We do not include title
pages, contents pages, reference list or appendices. In-text referencing is included in the word count.
Submissions which are substantially under the word limit will receive a low mark for failing to answer the
question fully. If a submission is over the word limit, the tutor will simply stop marking at that point where it is
10% over (e.g. 3300 words for an assignment with a 3000 word limit).You will not receive any marks for work
that is submitted outside of the maximum word limit.

Please refer to the generic Course Guide or your tutor is you require further clarification of the above
points.

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Contents

.................................................................................... 1
Introduction:- .......................................................................................................................................................... 5
SWOT analysis:-....................................................................................................................................................... 5
Strength:- ................................................................................................................................................................ 5
 Tariffs elimination:- ..................................................................................................................................... 5
 Bahrain service sector:-............................................................................................................................... 6
 Attracting investors:- .................................................................................................................................. 6
Weaknesses:- .......................................................................................................................................................... 6
 Bahrain-US FTA against GCC agreements:- ................................................................................................. 6
 Lack of Bahraini businesses contribution:- ................................................................................................. 7
 TPL expiry:- .................................................................................................................................................. 7
Opportunities:-........................................................................................................................................................ 7
 Direct shipping line:- ................................................................................................................................... 8
 Employment opportunities:-....................................................................................................................... 8
 Investment in Bahrain:-............................................................................................................................... 8
Threats:- .................................................................................................................................................................. 9
 Jordan and Oman FTA with U.S.:- ............................................................................................................... 9
 Bahrain-US FTA violation:- .......................................................................................................................... 9
 Anti-Muslim policies:- ............................................................................................................................... 10
Bibliography .......................................................................................................................................................... 11

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Introduction:-

On the 14th of September 2004 Bahrain signed the Free Trade Agreement (FTA) with U.S., and brought into

force on the 1st of August 2006. The purpose behind it is, to develop the economic relationship and to

minimize the trade and investment barriers between both countries (Center, 2010). Furthermore, the FTA will

smooth the trade flows, catalyzed investment flows, developed the service areas and increase the

employment opportunities (Anonymous, Bahrain-US FTA, N.D). In relation to maritime, Khalifa Bin Salman

port started it operations on the 1st of April, 2009. Therefore, it is considered as a transshipment hub for the

Gulf. Also, it has a container as well as general cargo terminal (Anonymous, KHALIFA BIN SALMAN PORT, N.D).

SWOT analysis:-

Strength:-
The Kingdom of Bahrain will gain strengths from the FTA with the U.S. in the following ways.

 Tariffs elimination:-
Once the Bahrain-US FTA came into force, a ratio of 100 percent of the Bahraini products became a duty free

to access the United Sates market (Center, 2010). Furthermore, Bahraini exports have the benefit to compete

with other third country exporters that do not have the duty-Free benefits listed under the FTA (Anonymous,

The Bahrain-United States, N.D). An example of a duty-free products Bahrain imported from U.S. is, the port

construction equipment. The tariff on this equipment will be reduced to zero percent depending on the

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regulation listed within the agreement. In maritime

perspective, the elimination of tariffs can boost the

exports and imports trade volume through sea

ports port activities. Also, the number of ships

entering Bahrain for loading and unloading will

increase rapidly (Bahrain, 2007).

 Bahrain service sector:-


The Bahraini service providers will have a significant access to the U.S service industries also they will be

treated similar to the U.S. companies. Within the Bahrain-US FTA, the U.S. government will allow Bahraini

suppliers to access the accounting, architecture, construction and maritime sectors. This will result in wider

market access, and the Bahraini products will gain comparative advantages by entering the U.S. market

(Anonymous, The Bahrain-United States, N.D). In relation to maritime, the Bahraini shipping companies will

have a direct shipping access service to the U.S. West Cost. This will boost Bahrain’s transshipment activities

and it will link the U.S. international ports with Bahrain (Summers, Bahrain businesses urged to seize FTA

opportunities, N.D).

 Attracting investors:-
According to the chamber secretary, Jassim Al Shatti, many companies will invest in the Kingdom of Bahrain to

benefit from the tax free in order to export their products to the United States. Also, the FTA will stimulate

trade between Bahrain and the U.S., and the import and export trades from U.S. will increase rapidly in the

Bahraini commercial markets. As a result of the FTA, The new Khalifa Bin Salman port will be an important

aspect in increasing trades by operating its facilities to their maximum to handle the huge demand

(Anonymous, Bahrain-US trade gets massive benefits, 2003).

Weaknesses:-
The Bahrain-US FTA also has weakness effect on the Kingdom of Bahrain in several ways.

 Bahrain-US FTA against GCC agreements:-


At the time the Bahrain-US FTA came into force, Saudi Arabia claimed that the FTA with the U.S. is against the

GCC agreements (Almezel, 2004). According to a senior official, the exemption of U.S. products from customs

duties will impact the GCC by adding an extra obstacle on the GCC customs unity. Also, it will hinder the
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economy and the financial unity. Nevertheless, the Bahrain-US FTA has included clauses that contradict the

GCC economic agreement fundamentals. Yet, in 2004 all the GCC leaders had a meeting in Bahrain and they

asked the host country to cancel the FTA with U.S. (Ghazaleh, 2004). Therefore, by ending the FTA with U.S.

Bahrain will lose the advantages of tax-free so the activities and the amount of ships leaving and entering

Khalifa Bin Salman port will decrease.

 Lack of Bahraini businesses contribution:-


The Bahraini businesses did not take full advantages from the opportunities available within the FTA. As well

as, Bahrain is producing a high quality garment but Bahraini businesses have a weak effort in exporting it to

the U.S. (Summers, Bahrain businesses urged to seize FTA opportunities, N.D). According to the president of

(AmCham), Khalid Al Zayani, the American businesses are taking the whole advantage of the FTA and they are

enthused about the agreement unlike the Bahraini businessmen’s (Anonymous, Bahraini firms 'slow to benefit

from FTA', 2007). In maritime perspective, this will affect Bahrain economy because the numbers of exported

shipments are less than the imported ones. So, the ships entering for loading purposes are less than the

unloading.

 TPL expiry:-
Whenever the tariff agreement is expired many Bahraini citizens will lose their jobs in the textile factories and

it might decrease trade. In 2015, the U.S. Senator and the Congress members requested the Senate Finance

Committee to extend the TPL till 2026 but their request

has been rejected. Consequently, this will allow Bahraini

companies to buy raw materials from countries that are

not signature to the FTA. As well as, Bahraini exporters

must prove that the fabric and yarn are made in the U.S. or

Bahrain in order to ship it and distribute it to the U.S. By

not approving that, the number of ships entering and leaving Bahrain will be minimized due to the TPL expiry

(Anonymous, US-Bahrain FTA expiry may hit textile firms, 2015).

Opportunities:-
The Bahrain-US FTA will provide future opportunities to increase the trade between both countries.

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 Direct shipping line:-
Bahrain will develop a direct shipping line with the United Sates in the near future. Kingdom of Bahrain will

have the ability to deliver and receive containers from Los Angeles through direct path. According to the chief

executive of Khalifa Bin Salman Port, Marco Neelsen, the benefit of the direct shipping line is the goods

imported to Bahrain will only took one week or more

to enter Bahrain. However, currently the shipments

took approximately 40 days to arrive in Bahrain. In

addition, to fulfil the gulf countries demands there

will be a need for smaller ships to deliver cargo from

Bahrain. This will make future traders to transfer

from using the causeway to use ships to deliver shipments (Anonymous, Bahrain-US direct shipping line on

way, 2013).

 Employment opportunities:-
The Bahrain-US FTA will create employment opportunities for skilled and educated Bahraini workers.

Furthermore, increasing the trade between the two countries will

expand the living standards for Bahraini citizens by giving them massive

jobs opportunities in many fields (Anonymous, The Bahrain-United

States, N.D). In addition, Khalifa bin Salman port offers different types of

jobs for Bahraini expertise. These jobs will include, System Operator,

Check in and Check out. The System Operator is responsible for

activating the X-Ray system in order to check the containers contents.

Whereas, the Check in must enter the containers numbers into the

system prior scanning them with the X-Ray. The Check-out is

responsible for checking the containers height and width before

scanning them.

 Investment in Bahrain:-
The FTA will eliminate the trade barriers between Bahrain and the U.S. in order to increase the number of

foreign and American investors in Bahrain markets (Anonymous, The Bahrain-United States, N.D). As well, the

agreement helps in decreasing business risks for investors in both countries. Whereas, The U.S. market is open
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to accept Bahraini investors and exporters. This can be result in, increasing the competiveness of Bahraini

goods at the U.S. market. Furthermore, Bahrain is looking forward to attract more investors due to its political

and economic stability. In addition, owing to the growth of investors in Bahrain the imports and exports of

goods will increase and the number of ships entering Bahrain will rise (Anonymous, BAHRAIN US FTA ROLE IN

BOOSTING NATIONAL ECONOMY, 2007).

Threats:-
Bahrain-US Free Trade Agreement has future threats on the Kingdom of Bahrain economy.

 Jordan and Oman FTA with U.S.:-


Another threat will impact Bahrain is the Free Trade Agreement between Jordan and Oman with the United

States. This will increase the competition with Bahrain because Bahrain is already facing an expiry of the TPL

whereas Oman and Jordan have the chance to extend the agreement because they entered the FTA much

later that Bahrain. Furthermore, the Omani authorities have started to request an extension for the tariff

agreement to more than three years and they are confident of getting it. Additionally, the amount of ships

entering Bahrain will be reduced due to the fact that Jordan and Oman have extended their TPL (Anonymous,

US-Bahrain FTA expiry may hit textile firms, 2015).

 Bahrain-US FTA violation:-


The Kingdom of Bahrain confronted an additional threat that impacted the country economy. Trade Arabia

newspaper published a report about some goods

importers in Bahrain have been accused of abusing

the Bahrain-US FTA in order to avoid paying taxes.

Furthermore, in 2012 the Sea Port Customs Affairs in

Bahrain recorded around 100 FTA violations. This

could cost the Bahrain economy 285.1$ millions.

According to the Customs Affairs director of Sea Ports

Customs, Khalifa Al Shomeli, some importers ship cargo from China to the U.S then to Bahrain. Therefore, the

importers instead of stating the country of origin which is China, they tend to state it as the United States in

order to benefit from the Bahrain-US FTA duty-free (Anonymous, Importers ‘misusing Bahrain’s FTA with US’,

2013).

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 Anti-Muslim policies:-
The new U.S. president Donald Trump has an intention of implementing the anti-Muslim policies. This rule will

ban seven Arab countries from entering and settling in the country even if they carry the U.S. visa. The

American-Arab Anti-Discrimination

Committee will execute an ideology test for

visa applicants in order to check their

religious beliefs. Therefore, the anti-Muslim

policy will ruin many careers and demolish

lives for Arab people. In relation to maritime perspective, the

politics will have an influence on the trade between Bahrain and

U.S. As a result, if the trade was influence negatively there will be

fewer goods imported and exported from the U.S. effecting the

operations of Bahraini ports (Alternet, 2017).

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Bibliography
Almezel, M. (2004, 12 19). Bahrain to take firm stand on FTA at Gulf summit. Retrieved 5 13, 2017, from Gulf
news: http://gulfnews.com/news/gulf/bahrain/bahrain-to-take-firm-stand-on-fta-at-gulf-summit-
1.342145
Alternet, B. N. (2017, 1 26). Trump's Racist Muslim Ban Is 'Even Worse Than Imagined'. Retrieved 5 13, 2017,
from Alternet: http://www.alternet.org/trump-racist-muslim-refugee-ban-rights-first-amendment
Anonymous. (2003, 5 9). Bahrain-US trade gets massive benefits. Retrieved 5 13, 2017, from Bahrain news
agency: http://bna.bh/portal/en/news/361344?date=2011-09-29
Anonymous. (2007, 12 12). BAHRAIN US FTA ROLE IN BOOSTING NATIONAL ECONOMY. Retrieved 5 13, 2017,
from Bahrain new agency: http://bna.bh/portal/en/news/419791
Anonymous. (2007, 8 1). Bahraini firms 'slow to benefit from FTA'. Retrieved 5 13, 2017, from Trade arabia:
http://www.tradearabia.com/news/ECO_128246.html
Anonymous. (2013, 7 19). Bahrain-US direct shipping line on way. Retrieved 5 13, 2017, from Trade arabia:
https://tradearabia.com/news/IND_239861.html
Anonymous. (2013, 4 7). Importers ‘misusing Bahrain’s FTA with US’. Retrieved 5 13, 2017, from Trade arabia:
http://www.tradearabia.com/news/LAW_233564.html
Anonymous. (2015, 4 28). US-Bahrain FTA expiry may hit textile firms. Retrieved 5 13, 2017, from Trade arabia:
https://www.tradearabia.com/news/BANK_280753.html
Anonymous. (2015, 4 28). US-Bahrain FTA expiry may hit textile firms. Retrieved 5 13, 2017, from Trade arabia:
https://www.tradearabia.com/news/BANK_280753.html
Anonymous. (N.D, N.D N.D). Bahrain-US FTA. Retrieved 5 13, 2017, from Bahrain Customs:
http://www.bahraincustoms.gov.bh/fta.php
Anonymous. (N.D, N.D N.D). KHALIFA BIN SALMAN PORT. Retrieved 5 13, 2017, from Ministry of
transportation and telecommunication: http://www.caa.gov.bh/content/khalifa-bin-salman-port
Anonymous. (N.D, N.D N.D). STATEMENT OF WHY THE UNITED STATES – BAHRAIN FREE TRADE. Retrieved 5
13, 2017, from Ustr:
https://ustr.gov/sites/default/files/uploads/Countries%20Regions/africa/agreements/bahrain/Statem
ent%20of%20Why%20the%20U.S.-
Bahrain%20FTA%20is%20in%20Interests%20of%20U.S.%20Commerce.pdf
Anonymous. (N.D, N.D N.D). The Bahrain-United States. Retrieved 5 13, 2017, from Economic development
board: http://www.bahrainedb.com/en/EDBDocuments/FTA-A4-6pp-SILVER-Spread.pdf
Anonymous. (N.D, N.D N.D). The Bahrain-United States. Retrieved 5 13, 2017, from Economic development
board: http://www.bahrainedb.com/en/EDBDocuments/FTA-A4-6pp-SILVER-Spread.pdf
Bahrain, A. t. (2007, N.D N.D). Gate Way. Retrieved 5 13, 2017, from Pars Bahrain:
http://www.parsbahrain.net/GATEWAYNewsLetter1.pdf
Center, T. I. (2010, 1 13). U.S.-Bahrain Free Trade Agreement. Retrieved 5 13, 2017, from export.gov:
http://2016.export.gov/FTA/bahrain/eg_main_017537.asp
Ghazaleh, D. A. (2004, 11 24). Bahrain-US free trade pact criticised. Retrieved 5 13, 2017, from Gulf news:
http://gulfnews.com/news/gulf/bahrain/bahrain-us-free-trade-pact-criticised-1.339516
Summers, M. (N.D, N.D N.D). Bahrain businesses urged to seize FTA opportunities. Retrieved 5 13, 2017, from
Gulf daily news: http://www.gulf-daily-news.com/Print.aspx?storyid=186340
Summers, M. (N.D, N.D N.D). Bahrain businesses urged to seize FTA opportunities. Retrieved 5 13, 2017, from
Gulf daily news: http://www.gulf-daily-news.com/Print.aspx?storyid=186340

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The marking framework for the assignment is tabled below:

Met criteria to a
Met criteria to an Met criteria to a Did not meet
very good standard
excellent standard satisfactory criteria
standard
B
A C F
14-16.9
17-20 12-13.5 0-11.5
7-8.4
8.5-10 6-6.9 0-5.9

Bahrain-US FTA An overview of the An overview of the An overview of the An overview of the
Bahrain-US FTA has been Bahrain-US FTA has Bahrain-US FTA has Bahrain-US FTA has not
10% excellently explained. been well explained. been adequately been adequately
explained. explained.

A fully comprehensive and A mostly comprehensive An adequately An inadequate Strengths


Strengths analysis
in-depth Strengths and in-depth Strengths comprehensive and in- analysis of the Bahrain-US
analysis of the Bahrain-US analysis of the Bahrain- depth Strengths analysis FTA from a Ports and
20% FTA from a Ports and US FTA from a Ports of the Bahrain-US FTA Maritime perspective has
Maritime perspective has and Maritime perspective from a Ports and Maritime been provided and is not
been provided and is has been provided and is perspective has been satisfactorily explained.
(LOs 2&3)
excellently explained. well explained. provided and is
satisfactorily explained.

Weaknesses A fully comprehensive and A mostly comprehensive An adequately An inadequate


analysis in-depth Weaknesses and in-depth comprehensive and in- Weaknesses analysis of
analysis of the Bahrain-US Weaknesses analysis of depth Weaknesses the Bahrain-US FTA from a
FTA from a Ports and the Bahrain-US FTA analysis of the Bahrain- Ports and Maritime
20%
Maritime perspective has from a Ports and US FTA from a Ports and perspective has been
been provided and is Maritime perspective has Maritime perspective has provided and is not
(LOs 2&3) excellently explained. been provided and is been provided and is satisfactorily explained.
well explained. satisfactorily explained.

Opportunities A fully comprehensive and A mostly comprehensive An adequately An inadequate


analysis in-depth Opportunities and in-depth comprehensive and in- Opportunities analysis of
analysis of the Bahrain-US Opportunities analysis of depth Opportunities the Bahrain-US FTA from a
FTA from a Ports and the Bahrain-US FTA analysis of the Bahrain- Ports and Maritime
20%
Maritime perspective has from a Ports and US FTA from a Ports and perspective has been
been provided and is Maritime perspective has Maritime perspective has provided and is not
(LOs 2&3) excellently explained. been provided and is been provided and is satisfactorily explained.
well explained. satisfactorily explained.

A fully comprehensive and A mostly comprehensive An adequately An inadequate Threats


Threats analysis
in-depth Threats analysis and in-depth Threats comprehensive and in- analysis of the Bahrain-US
of the Bahrain-US FTA analysis of the Bahrain- depth Threats analysis of FTA from a Ports and
20% from a Ports and Maritime US FTA from a Ports the Bahrain-US FTA from Maritime perspective has
perspective has been and Maritime perspective a Ports and Maritime been provided and is not
provided and is excellently has been provided and is perspective has been satisfactorily explained.
(LOs 2&3)
explained. well explained. provided and is
satisfactorily explained.

Report structure, Report is excellently Report is well structured. Report is reasonably well Report is not well
presentation, use structured. Information is Information is presented structured. Information is structured. Information is
of English and excellently presented, well and can be easily reasonably well not presented adequately,
referencing flows appropriately and understood. presented and can be does not flow appropriately
can be clearly understood. adequately understood. and cannot be clearly
APA referencing is understood.
10 % APA referencing is correct. mostly correct. APA referencing is poor.
APA referencing has not
(LOs 2&3) been used at all.