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Pent-Up Demand

The water resources act may be a case of “penned up” demand.

June 18, 2014

The maritime industry, and U.S. ports in particular, have been pushing for action on the Water Resources Reform and Development Act of 2014 (WRRDA). The act finally came under President Barack Obama’s pen, and it was signed into law. But the job isn’t done yet.

At the Georgia Ports Authority, the signing was welcomed and spurred an immediate response: “With the president’s signing today of the Water Resources Reform and Development Act of 2014, the Savannah Harbor Expansion Project (SHEP) is authorized to begin construction.”

At the Port of Jacksonville, there was a similar response: “The inclusion of Jacksonville’s two critical harbor improvement projects — Mile Point and Harbor Deepening — ensure JAXPORT will remain competitive in the global economy and continue to create jobs and opportunity for northeast Florida. We are thankful to all of the lawmakers who put in countless hours to make this bill a reality.”

Back up the coast in Georgia, they added, “The harbor deepening is recognized across Georgia as the state’s most important infrastructure project in terms of future economic development,” port authority board chairman Robert Jepson said.

The Georgia Ports Authority added that federal studies show that for every dollar invested in the Savannah harbor deepening, the nation’s economy will reap $5.50 in net benefits. Lower prices per container slot on Post-Panamax vessels will save U.S. companies moving goods through Savannah 20 to 40 percent on transportation, the port authority said.

Watching the developments and equally quick to comment was the Airforwarders Association (AfA). In its statement, AfA said, “In addition to authorizing federal spending on a broad range of ports and waterways infrastructure projects, it also cuts red tape and bureaucracy in order to accelerate their completion.”

Air freight forwarders might seem like an unusual industry segment to be applauding a maritime bill that will improve port infrastructure. After all, the two modes do compete. But they also collaborate, as Brandon Fried, AfA executive director was quick to point out. “Much of the cargo handled by the nation's air freight forwarders is transferred across two or more modes of transportation between shipper and receiver,” he said. “WRRDA will do much to advance the nation's cargo handling capabilities so that its transportation infrastructure can stay competitive with other trading nations.”

If you can think of transportation modes as partisan, there could be a lesson here for the U.S. Congress. "Our members understand that moving freight requires the efficient operation of all forms of transportation into one intermodal network, and keeping our infrastructure in world-class condition is vitally important to that aim," AfA’s Fried observes. "We are delighted that the administration and members of Congress from both parties have been able to work together to get this legislation on the books so these vital projects can move forward."

When it comes to world trade, infrastructure is always a factor in site selection, sourcing and distribution. It is no exaggeration that the condition of U.S. ports — along with all other facets of its transportation infrastructure — can seriously impede the economy’s growth and competitiveness. Logistics is all about fast, efficient and cost effective movement of goods. Poor infrastructure not only slows the movement of goods, it adds cost. Approving the waterways bill is a step in the right direction, but it is still only one step.

 The air freight industry is right to voice its support for the waterways bill because it will need many voices to join its own efforts on behalf of infrastructure. Motor carriers and railroads should be joining them, not only in praising action on the waterways bill but in keeping legislators and the public focused on the rest of the transportation infrastructure. 

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