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10 1108 - CRR 09 2021 0031
10 1108 - CRR 09 2021 0031
https://www.emerald.com/insight/2516-7502.htm
CRR
4,1 Maritime resilience during the
COVID-19 pandemic:
impacts and solutions
124 Jie Ying Chua, Ryan Foo, Kim Hock Tan and Kum Fai Yuen
School of Civil and Environmental Engineering, Nanyang Technological University,
Received 3 September 2021
Revised 21 December 2021
Singapore, Singapore
Accepted 25 January 2022
Abstract
Purpose – This study aims to study the resilience of the maritime industry by analyzing the impacts of
COVID-19 on the maritime industry, in particular, on the shipping management aspect and offshore sector,
investigate the effectiveness of current solutions and recommend future solutions for the industry to reduce or
mitigate the negative impacts.
Design/methodology/approach – In order to better appreciate resilience in the maritime industry, the study
conducted secondary research and semi-structured online interviews to (1) identify the impacts of COVID-19 on
the shipping management and offshore sector, (2) analyze the effectiveness of current solutions and (3) provide
some strategies to enhance the effectiveness of the current measures.
Findings – he results are congruent with existing literature which indicate that the pandemic has negatively
affected the global economy, changed the global trade network and contributed to the sharp decline in demand
for oil. In response to the pandemic, governments have implemented safety and health-related measures such
as lockdown, safe-distancing and travel restrictions. Often, measures differ from countries to countries and
these non-standardized and changing regulations further increase the challenges faced by the industry. From
the shipping management perspective, the industry experienced issues such as crew changing, trade
contraction and the expiration of shipping certificates, which supported and validated current research.
Meanwhile, the offshore industry is challenged by the increasing market volatility and uncertainty, increasing
need to source for alternative fuels and the declining oil exploration activities. Current strategies adopted by
shipping management companies include crew change management, capacity management and the extension
of ship certificates, whereas offshore industry chose to collaborate with oil majors.
Research limitations/implications – By identifying the impacts and challenges and studying the
effectiveness of solutions adopted by the maritime industry, this paper allows maritime industry stakeholders
and policymakers to develop strategies to mitigate the effects of the global health crisis and strengthen the
resilience of the industry. However, as the pandemic continues to develop and evolve, strategies need to be
reviewed continuously in response to the changing situations.
Originality/value – This research analyses the impacts and solutions in response to the COVID-19 pandemic,
which contributes to the development and formulation of strategies to strengthen the resilience of maritime
transport.
Keywords Maritime resilience, COVID-19, Shipping management, Offshore industry, Impacts, Solutions
Paper type Literature review
1. Introduction
On the 31 December 2019, the Chinese authorities informed the WHO of pneumonia cases with
an unknown cause (WHO, 2020a). It was later identified as a new form of coronavirus and given
the name “COVID-19”. Although COVID-19 is not as deadly as compared to SARS, the nature of
the virus is more contagious due to its long incubation period, after which symptoms would
start to show. During the incubation time, the carrier becomes asymptomatic and would be able
to spread the virus without showing any symptoms. As such, it was able to spread throughout
the world in just a few months, making it a global health crisis. As of 15 April 2021, there has
been a total of 138 million cases and 2.97 million deaths since its discovery.
Continuity & Resilience Review The alarming rate of transmission and fatality rate has created havoc across the world. It
Vol. 4 No. 1, 2022
pp. 124-143
is no longer simply a global health crisis, as COVID-19 has led to several significant impacts
© Emerald Publishing Limited
2516-7502
on the global economy (Permal, 2021) and the transportation industry (Menhat et al., 2021;
DOI 10.1108/CRR-09-2021-0031 Notteboom et al., 2021; Oyenuga, 2021; Emamian and Mazlan, 2021). Since it is undeniable
that maritime transport is the backbone of the global economy, as it accounts for 80% volume Maritime
of the goods traded (UNCTAD, 2021), this paper would address the maritime sector. resilience
A review of the existing literature illustrates that there has been an emphasis on
determining the impacts of COVID-19 on the global trade and economy (Loske, 2020; Permal,
2021; Verschuur et al., 2021), and the effects of the COVID-19 pandemic on shipping activities
(Shi and Weng, 2021). Due to the contagious nature of the virus, countries rushed to
implement health and safety measures and regulations such as lockdowns, travel bans and
safe-distancing measures to curb the spread of this novel virus. As a result, these practices 125
serve as a sudden disruption that has put businesses in jeopardy of shutting down, as they
navigate through this tough period, especially for the shipping industry. To illustrate, it is
evidenced that the pandemic has resulted in a significant fall in commodity prices
(Worldbank, 2020) leading to a fall in trade that is estimated to be between 13% and 32%
according to the WTO (WTO, 2020). As shipping has a derived demand, it would depend on
international trade for the demand for their services. One of the greatest challenges that the
shipping sector experienced was the difficulty in crew change because of frequent changing
travel restrictions placed by the different governments across the world. There has been a
significant number of literature have analyzed the effects of COVID-19 on seafarers (Ciceri
and Prigol, 2021; Kaptan and Olgun Kaptan, 2021; Lucas et al., 2021) and concluded that the
seafarers stay onboard the vessel longer than the permitted time stipulated by the Maritime
Labor Convention 2006 (MLC), and this deteriorates the mental health of the crew members.
Although the available literature are substantial in answering the impacts of COVID-19 on
the global economy and merchant shipping activities (i.e. cargo transportation and cruise),
not much attention is given to analyze the effects of pandemic on ship management and
offshore industry. Ship management is an area that deserved more attention due to its ability
to determine business continuity and the profitability of the company. To elaborate, ship
management refers to the process of managing ships. It involves the planning and execution
of shipping processes which include services such as the provision of maintenance services
on the machinery onboard the vessel, crewing and insurance (MarineInsights, 2021). Without
proper ship management, the company faced a higher possibility of going into bankruptcy
(Shin et al., 2019). Furthermore, ship management is different from the maritime industry, as
the latter often primarily focuses on the provision of transportation services, whereas the
emphasis of ship management is on processes that enable smooth shipping operation. Next,
the rationale for analyzing the offshore industry is because besides dealing with the
challenges brought up by the pandemic, shipping companies have to comply with the
International Maritime Organization (IMO) sulfur cap regulation that was in force on
1 January 2020 with the effort to decarbonize the shipping industry. The offshore industry
focuses on the procurement of oil and gas which would be used for energy production. A brief
overview of the oil market suggests that the pandemic has contributed to the volatility of oil
prices (Devpura and Narayan, 2020; Michail and Melas, 2020), and the trend to shift away
from fossil fuel to cleaner fuel alternatives further weakens the offshore business.
As such, the aim of this study is to understand the resilience of the maritime industry
through (1) analyzing the impacts of COVID-19 on shipping and its activities, in particular,
ship management and offshore; (2) investigating the effectiveness of current solutions; and
(3) recommending future solutions for the industry to reduce or mitigate the negative impacts.
The remainder of this paper is organized as follows. Section 2 discusses the literature
review. Section 3 describes the data collection method. Section 4 reports the results and main
findings, and Section 5 provides the concluding remarks.
2. Literature review
Since the outbreak of the COVID-19 pandemic, there are various literature that research on
understanding the virus itself and drawing comparison of the ongoing pandemic with the
CRR SARS epidemic in 2003 or even the global financial crisis in 2008. For example, Haleem et al.
4,1 (2020) consolidated and identified the areas of academic research that need to be done to curb
the transmission of the COVID-19 virus. Notteboom et al. (2021) analyzed the impacts of
COVID-19 on global container shipping and port operations by making a comparison with the
pandemic with the global financial crisis, while McCloskey and Heymann (2020) cover the
lessons that can be learned from SARS and apply them to the COVID-19 pandemic. A
significant number of studies discussed the impacts of COVID-19 on global trade and
126 economy (Oyenuga, 2021; Permal, 2021; Verschuur et al., 2021; Xu et al., 2021). The above
studies concluded that the pandemic has resulted in a sharp decline in the global economy
and a significant fall in global trade activity. This can be further supported by Worldbank
(2020) and WTO (2020) which illustrate a fall in commodity prices arising from a fall in the
trade that is estimated to be between 13% and 32%. Apart from analyzing COVID-19 from
global perspectives, numerous researches focus on gathering data on the effects of the
COVID-19 pandemic on the maritime industry (Guerrero et al., 2022; Menhat et al., 2021;
Millefiori et al., 2021; Narasimha et al., 2021; Oyenuga, 2021; Saviolakis and Pazarzis, 2021; Shi
and Weng, 2021; Tai et al., 2021). To illustrate, Menhat et al. (2021) discussed the impact of the
pandemic on four areas, namely, shipping, fisheries, maritime tourism and oil and gas sector;
Ma nkowska et al. (2021) analyzed the response of seaport terminal operators concerning
COVID-19; and Charłampowicz (2021) explored the service quality of sea transportation
during the pandemic period. Furthermore, Wang et al. (2021) assessed the ship management
efficiency index based on congestion perspectives, which is relevant as the health measures
implemented by the government authorities such as safe distancing, quarantines
arrangement and travel restrictions would lead to a decrease in productivity at ports and
cargo handling operations. Furthermore, in view of curbing the spread of the virus, various
government authorities had imposed travel bans and restrictions which in the process
increases the difficulty for the shipping company to perform crew change operations.
Therefore, multiple scholars had conducted research to identify the impacts of the pandemic
on the well-being of seafarers (Kaptan and Olgun Kaptan, 2021; Lucas et al., 2021; Luchenko
and Georgiievskyi, 2021; Pauksztat et al., 2022). The findings of various studies concluded
that the seafarers stay onboard the vessel longer than the permitted time stipulated by the
Maritime Labor Convention 2006 (MLC), and this deteriorates the mental health of the crew
members. Next, the study conducted by Devpura and Narayan (2020) reflected that oil prices
have become increasingly more volatile which poses a greater challenge to the offshore
industry.
0
–1 1975 1982 1991 2009 2020
–2
GDP
–3
GDP per capita
–4
–5
–6
–7 Figure 1.
Global recession years World GDP
growth rate
Source(s): Authors (2021)
CRR important it is. For example, China being the center of the network would imply that it is the
4,1 most important, which is consistent with the description of being the “factory of the world”
where most countries depend on its exports (Vidya and Prabheesh, 2020). Comparing across
the time periods, it was concluded that trade patterns had shifted through the changes in
positions of the countries. For example, South Korean used to be in the center of the network
implying used to be an important economy in 2018 but it became a peripheral economy due to
the outbreak of COVID-19 in the first quarter of 2020. However, an interesting observation
128 was that even when China was the originating country for COVID-19, although its position
has changed it is still part of the inner circle of the network showing its importance in
the world economy (Vidya and Prabheesh, 2020). This shows that COVID-19 has changed
the way nations interact and trade with each other, the shift in trade patterns could affect the
survivability of the country as the pandemic continues (Gruszczynski, 2020; Lee, 2020;
Zwanka and Buff, 2021). However, as the pandemic continues, only time will tell whether this
alteration in trade networks would be permanent or return to pre-COVID-19 days.
3. Methodology
This study focuses on understanding maritime resilience by analyzing the impacts of the
ongoing COVID-19 pandemic on the industry and current solutions implemented to aid the
industry in this pandemic. Both primary and secondary data are considered in the study to Maritime
get a more diverse and holistic view of how the COVID-19 pandemic has impacted the resilience
maritime industry and the effectiveness of the current solutions.
3.2 Interviews
The interviewees were also selected from different sectors of the maritime industry so that a
more complete analysis can be made. Table 1 illustrates the profile of the interviewees in
this study.
The interviewees were selected mainly based on their work experiences in the field and
their willingness to participate in the authors’ research study. Due to confidentiality concerns,
the authors were unable to obtain and disclose interviewees’ years of work experience in the
industry. Instead, the designation of the experts which indirectly signify work experiences is
presented in Table 1. Four experts were interviewed in this study and all of them held at least
managerial positions in their company, such as manager, general manager, assistant director
and director. Although the number of interviews conducted were limited, it has a relatively
good representative of the different areas in the maritime industry. The study includes
representatives from the government, container business, offshore and supplier to better
appreciate resilience in the maritime industry.
Interview questions are designed with both generic and specific questions that relate to
the interviewee’s sector of the industry. To illustrate, general questions focus on
understanding the challenges and impacts of COVID-19 on the maritime industry, and
Asst. Director operations planning and pilotage/Deputy port master and in Government
charge of operations planning and pilotage
Deputy general manager Containership
Chartering manager Offshore
Director Bunker tanker owner/Marine Table 1.
fuel supplier Interviewees profile
CRR how has the pandemic affected their business and daily operations. While specific questions
4,1 emphasize identifying the solutions industry players put in place to mitigate and overcome
the challenges posed by COVID-19, as well as the effectiveness of those solutions. As such,
based on the responses gathered, the authors categorized the subsequent section into
challenges, impacts, solutions and recommendations.
4.4 Recommendations
As COVID-19 continues to plague the maritime industry, it is important that the industry
adapts to this unprecedented event by coming up with solutions to fight the impacts of the
pandemic to make the industry more resilient to similar events in the future. This section of
the study aims to explore the possible solutions that can be adopted regarding ship Maritime
management and offshore activities. resilience
4.4.1 Shipping management. Recommendations for shipping management covers the
enhancement protection of seafarers through accelerated vaccination, horizontal
collaboration and cooperation for a crew change and the increased investment in
unmanned vessels.
4.4.1.1 Accelerated vaccinated of seafarers. Since the alarming rate of infection of this
novel virus, the world has scrambled to come up with a vaccine to combat this pandemic. In 137
December 2020, Pfizer was the first company to obtain approval by the US FDA authorities
for the administering of their vaccine citizens. Following this, many other countries have
come up with their own vaccines to combat COVID-19. Currently, certain groups of people are
being prioritized as they are being classified as vulnerable group. For example, frontline
workers such as nurses and doctors, and the elderly are prioritized.
However, this study would like to propose that seafarers should be treated as an essential
group of workers who are vulnerable. As the world economy continues to grow because of
globalization, there is a growing need for shipping to become more efficient so ensure
competitiveness and efficiency of this mode of transport. As shipping is international in
nature, countries are afraid of importing the virus through shipping, which led to the banning
of crew changes and shore leaves. Although there are some countries like Singapore, that
have recognized the importance of seafarers and have prioritized them for vaccination
(Nautilus, 2021), there needs to be a unified approach for this solution to be effective.
Accelerating the vaccination of seafarers would not only protect the seafarer but also
those around them, including the countries where their ships call. First, it would be easier for
the crew to travel which greatly improves the crew change issue the industry is facing now.
This would then improve the mental wellness of seafarers who have been stuck on vessels
due to the lockdowns and allow the hiring of those who could not sign on due to the strict
regulations which ensure their financial survivability. Second, with the ship’s crew being
vaccinated, quarantine restrictions put on ships can be relaxed as the human transmission
would be minimized which reduces port congestions. This allows the shipping companies to
save on the cost needed when serving quarantine and allow the ship to make more round trips
per year. Thus, vaccinations could effectively reduce the harmful impacts of COVID-19 as it
minimize the chance of transmission.
4.4.1.2 Horizontal collaboration and coordination for crew change. Although tight
restrictions on crew changes are implemented on the port side, another reason for the crew
change issue is the availability of flights. A forecast has been done stating that there would be
a reduction in seats offered by airlines by 47–58% (Suau-Sanchez et al., 2020), this would
reduce the supply of flights for crew change by more than half. Furthermore, a crew change
must be coordinated such that an on-signer has to take over an off-signer, the crew change
would be cancelled if any one of these people fails.
The horizontal collaboration approach between shipping companies could help fill up
seats on flights such that they would not be cancelled due to excess capacity. However,
shipping companies would need to be willing to collaborate and coordinate their crew change
schedules which might be difficult. Alternatively, an external company could handle the
coordination of crew changes. This would allow shipping companies to concentrate on their
core competencies while the third-party company coordinates and consolidates the flight
plans to allow for a higher success rate for crew changes.
This solution could be implemented with the vaccination of seafarers to further enhance
the crew change process as this allows the consolidation and grouping of seafarers from
different shipping companies to be more flexible knowing that the seafarers are protected
from the virus. Hence, these two solutions would go hand in hand with each other to solve the
crew change issue that the industry is having.
CRR 4.4.1.3 Increased investment into unmanned vessels. For a long-term solution, this study
4,1 would suggest an increase in investment into unmanned vessels. Although the main factor
for the investment of unmanned vessels is to improve the navigational safety by reducing
human-related accidents, COVID-19 has exposed one of the weaknesses of traditional
manned shipping. As seen by the COVID-19 pandemic, governments around the world
implemented strict measures in order to curb the transmission of the virus, and due to the
international nature of shipping, it was seen as a potential area for importing the virus. With
138 unmanned vessels, the chance of human-to-human transmission of diseases would decrease
to zero unless the virus is able to remain on surfaces for a long period of time. This would
suggest that there would not be a need for ship quarantines, as there is no crew onboard the
vessel.
However, the investment into unmanned vessels is easier said than done. There is a
plethora of finance, legal and operational issues that come with it. For the operational impact,
although there would be a reduction in human-related accidents, there could be an increase in
non-navigational accidents such as fires or engine failure (Wrobel et al., 2017). Furthermore,
regulatory and legal frameworks have to be overhauled due to the major change in shipping
operations which is a major barrier as governments might not be willing to do that
(Chwedczuk, 2016).
Even with the presence of these barriers, COVID-19 has given us another reason for the
maritime industry to push for the further development and innovation of unmanned vessels
such that they would eventually be put into operation which allows the industry to be more
resilient against future global health crises.
4.4.2 Offshore industry. Recommendations for the offshore industry covers the investment
into other offshore energy sources, and the increased usage of automation and digitalization.
4.4.2.1 Investment into other offshore energy sources. As mentioned in impacts, black
swan events like COVID-19 caused huge volatility in the offshore oil market. This would
imply that there is still a high reliance on crude oil as the primary source of energy. However,
the investment into other sources of energy could help alleviate the volatility of the market by
diversifying the source of energy in the global market. Some of these alternative sources of
energy could be offshore wind or offshore solar energy. These technologies could provide two
major benefits. First, it would allow the oil market to be less volatile, and second, these are
green sources of energy that would lead to less emissions to combat global warming.
Both these technologies are not new to the industry. However, since COVID-19 has
exposed the flaws of the oil market, it would be a good opportunity to increase the investment
into these technologies such that more economies of scale could be achieved to make them a
viable source of energy. Ultimately, diversifying would make the energy market more
resilient to big scale events which would have downstream impacts on essential goods such
as goods and transportation.
4.4.2.2 Automation and digitalization. Another solution that would help the offshore
industry would be to investigate the possibility of automation and digitalization. As
pandemics like COVID-19 transmit through close contact, governments have implemented
social distancing to try to curb the spread of such virus. However, these viruses can remain on
surfaces which do limit the effectiveness of social distancing. The primary role of automation
and digitalization technologies is to improve productivity while reducing operating costs.
However, automation and digitalization could allow the industry to be more resilient to global
health crises. For example, digitalization of delivery notices that is grounded on the
blockchain would allow the safe and secure transmission of delivery notifications between
parties without being physically in contact with one another. Furthermore, the automation of
plugging and unplugging of connection hoses would allow for less human contact and
accidents which raises the safety level of operations.
Essentially, increasing the investment and research into automation and digitalization Maritime
would increase productivity, efficiency and resilience of the industry by transitioning into a resilience
more technological way of operation.
5. Conclusion
In conclusion, COVID-19 has restricted the maritime industry by limiting the physical contact
of people. For ship management and offshore activities, the people that were hit the hardest 139
were the most essential group of workers, the seafarers. Although not the deadliest of viruses,
COVID-19 is most likely to have the greatest impact compared to other epidemics or
pandemics in this century, such as the 2003 SARS epidemic. This is due to its ease of
transmission which led to its widespread infection and possibility of infection. With its
asymptomatic nature, it allows the virus to remain undetected until after its incubation
period, but by then, its host could have already infected many others. This study has
analyzed the resilience of the maritime industry through the investigation of the challenges,
impacts, current solutions and the effectiveness of those solutions. The key findings of this
study are as follows. First, the study has identified four impacts of COVID-19 on shipping
management; difficulty in performing crew change operation, port congestions, a decline in
trade which affects trade activity and challenges in performing physical inspection onboard
the vessel before the issuing of compliance certificates. Second, the study discussed the three
impacts of the pandemic on the offshore sector which include increased volatility and
uncertainty in the oil market, increasing emphasis on the need for alternative fuel and
decreasing oil exploration activities. Thereafter, mitigation strategies such as crew change
management, capacity management through collaboration with other shipping companies to
increase space utilization, the extension of shipping certificates and increase cooperation with
other oil majors are presented. Lastly, recommendations such as increasing the vaccination
rates to better protect the seafarers, incorporating horizontal collaboration and coordination
to support crew change, increasing the investment on unmanned vessels, diversifying energy
sources and increasing usage of automation and digitalization are provided in the last section.
The study has supported, and value-added to the findings of existing literature on the
impacts of COVID-19 on the maritime industry by providing an in-depth discussion with
regards to ship management and the offshore sector, as well as supplementing the current
research with mitigation strategies and recommendations. However, the study may not have
sufficient interviewees to provide a complete overview of the maritime industry. Perhaps,
future studies could consider inviting government authorities and policymakers to provide
their insights to ensure a more holistic analysis of the pandemic situation.
For the time being, the most critical values that the industry needs to adopt is adaptability
and cooperation. Being adaptable allows the industry to handle whatever challenge this
pandemic brings up. Ideally, the industry could think of solutions that allows the industry to
be more productive and yet increase the resilience of the industry. Such an example would be
investing in technology where automation and digitalization could obtain both objectives.
There also needs to be cooperation between stakeholders throughout the supply chain to
have a unified approach in combatting the pandemic. This allows the standardization of
regulations and practices such that confusion and misunderstanding are minimized. Lastly,
this study hopes that it has shed some light on the current issues regarding the pandemic and
what can be done to help increase the resilience of the maritime industry.
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Corresponding author
Kum Fai Yuen can be contacted at: kumfai.yuen@ntu.edu.sg
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