2014-04-30 07:12:04 - Global Port Security Market - a new market research report on companiesandmarkets.com
Ports are regarded as a significant vulnerability in the threat perception of domestic security agencies globally. There are competing forces between commercial and security imperatives that make open, fast, and efficient maritime trade a key security risk. The ability to increase security whilst simultaneously improving commercial operations is the ultimate goal, whereas slowing down trade and implementing burdensome security architecture are not only directly cost inhibitive but also involve huge indirect costs to trade. For port operators and security providers, integrated solutions to optimise convergence of technology, systems, people, and processes are the answer. Future technologies must be designed with that purpose in mind, and integrated, efficient solutions are in growing demand.
Securing border entry points at seaports is complicated by
the sheer volume of traffic and critical importance of maritime trade. Ports are a complex network of trade and commerce, linking road, rail, air, and sea routes, and connecting pipelines with energy fields, consumers with businesses. The ports system is absolutely vital to global economic processes that cannot face disruption. As such, there is a potential dichotomy whereby increased security could mean increased delays and cost billions, while insufficient security could cause huge economic loss through terrorist attack and crime.
Over the last few years, global seaborne trade has grown. Growth is expected to continue, in line with this historical trend, and is set to increase reaching double by 2033. While bulk trade accounts for the largest share, containerized cargo grew most significantly, particularly from the 1980s onwards.
Developing countries are driving growth with regions such as Africa and Latin America, as well as countries such as Australia recently, supplying natural resources to high-demand countries such as China. Similarly, China is the leading exporter of consumer goods to the large consumer markets of North America and Europe. As a result, world container throughput increased. The United Nations (UN) 2012 World Economic Situation and Prospects report and the International Maritime Organisation´s (IMO) 2012 International Shipping: Facts and Figures document suggest sustained double-digit growth over the coming years, bolstered by a resumption of port infrastructure projects that were put on hold during the harshest period of global economic downturn between 2009 and 2012.
Increasing industrialization and globalisation, including increased foreign direct investment and global finance flows, have been the key drivers of this general increase in total trade volume along with a growing demand for consumer products. Advances in technology have also made shipping an increasingly efficient mode of logistics. Research indicates that global container throughput over the next few years is likely to grow higher than GDP growth. In faster growing emerging-market regions, throughput is likely to be higher than this global average. Growth in container movement means increased traffic through ports and more investment in port infrastructure, creating opportunities for security providers.
The balance between commercial efficiency and rigorous security will continue to be difficult. Global just-in-time business models underpinning the world economy and the possibility of disruption caused by monolithic security processes would have a huge adverse impact. The Government Accountability Office in a report to the United States Congress in 2010 stated: "The container shipping system is designed for speed and efficiency. Transportation services are a critical component of the global, low inventory (i.e. just-in-time) distribution model that many manufacturers have adopted... supply chain analysts are concerned that increased security-related delay at seaports could threaten the efficiency gains achieved in inventory management over the past two decades". Upsetting this system unnecessarily would be profoundly detrimental. Therefore, economically-beneficial solutions must be the focus for both port stakeholders and security providers.
Key industry stakeholders indicated that the key drivers in the market are gross domestic product (GDP) growth, government investment, regulation, and globalisation. Global GDP growth, particularly in fast-growth regions supplying goods to high-demand consumer markets with growing trade output, is increasing maritime trade and triggering growth in the port and shipping markets. This is directly linked to high capital-expenditure projects at ports, driving the necessity for security to keep pace with increasing throughput. Government investment in critical national infrastructure is driving increased security demands by providing impetus for port operators to invest in security infrastructure where government subsidies and resources can be leveraged to ensure cost efficiency. Similarly, government legislations and regulations are forcing the industry to take on more responsibility for achieving minimum security measures, providing commercial incentives as well mandatory regulations.
Finally, the expansion of the global market share of a handful of large port operators is creating opportunity for standardisation of port operations across more and more ports worldwide. This by-product of globalisation, alongside the growth of international trade, is providing potential to improve security within commercial operations as business processes between global ports become more aligned.
Industry consolidation, driven by globalisation, is likely to incentivise large port operators, who have the capability and assets to leverage innovative and integrated security solutions. Not only do they have the required resources but there are growing levels of compatibility between foreign ports with the same operator. Moreover, ports with different operators are now more likely to have similar business models, knowledge, and operational culture. As such, large global port operators may find it easier to work together with competitors from the same strategic group for mutual benefit. End-to-end solutions that reach across the whole value chain are easier to implement with such vertically-integrated port operators. Securing point-of-origin ports and the connection right through to destination port is likely to become a lesser restraint over time as a result. Interconnected communication and information flow between ports is therefore a growing trend.
There was a plethora of legislations in the previous decade in an attempt to improve port security as governments became increasingly wary of domestic security vulnerabilities. The policy agenda has been particularly driven by the United States due to high threat perception and vast economic interest. Security objectives include credentialing of suppliers and personnel, screening cargo at point of origin, notification of contents to the destination prior to arrival, in-transit cargo security including the increasing use of tamper-proof seals and monitoring devices, and cargo inspections on entry to the port.
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