Sunday, August 23, 2009

DOUBTS CAST ON RUSSIA'S "RESCUE" OF "ARCTIC SEA"

       Moscow's contradictions and evasions provoke speculation that a 'hijacked' ship was carrying a secret cargo By Shaun Walker

       The ship has been found, the crew has been saved, and the pirates have been arrested. But the mystery surrounding the Malteseregistered and Russian-crewed Arctic Sea is, if anything, deeper than ever.
       The Russian navy arrested eight men last Tuesday for what may be the first case of piracy in European waters since the 17th century. The Russian Defence Minister, Anatoly Serdyukov, said that the group - citizens of Russia, Estonia and Latvia - had hijacked the ship off Sweden in July, and forced it to sail to Africa.
       But experts have expressed doubt over Moscow's explanation. And last Wednesday the Malta Maritime Authority finally admitted what has been suspected for several days that the ship "had never really disappeared".
       "The movements of the Arctic Sea were always known for several days, notwithstanding reports that the ship had disappeared,"the authority was quoted as saying."There was consensus among the investigating authorities ... not to disclose any sensitive information [so as] not to jeopardise the life and safety of the persons on board and the integrity of the ship."
       It was an "explanation" that left behind almost as many unanswered questions as before. The methods and motivations of the hijackers remain unclear, and rumours that the ship had a secret cargo persist.
       The Arctic Sea departed from Finland with a cargo of timber on July 21. Three days later,the crew were reportedly attacked in the Baltic by masked men masquerading as Swedish drugs police, speaking English with an accent,who tied them up, beat them and questioned them about drugs.
       It is allegedly these men who have been arrested for hijacking the ship, although it had earlier been reported that the men left the Arctic Sea after 12 hours on board. It is also unclear why Russian, Latvian and Estonian hijackers would speak to the Russian crew in English.
       The last radio contact from the ship came on July 28, after it passed through shipping
       anes between Britain and France and sailed out into the Atlantic. The ship was due to arrive in the Algerian port of Bejaia on August 4 to unload its timber cargo worth just over ฃ1 million (about 56 million baht).
       It never arrived. It wasn't until eight days ater, however, on August 12, that Russian President Dmitry Medvedev ordered the military to take "all necessary measures" to search for the ship. After a series of strange and contradictory sightings and denials, it was announced last Monday afternoon that the Russian navy had rescued the ship 12 hours before. The Arctic Sea was 300 miles off Cape Verde, thousands of miles from its original destination.
       So far there has been no inkling of who the hijackers are or what their motive may have been. Only their nationalities are known.Russian officials said questioning of the men was continuing aboard the Ladny , the Russian vessel that carried out the "rescue mission".Some analysts suggest that the disinformation admitted by the Maltese might be happening again. Conspiracy theorists in Russia even speculate that Russian authorities knew all along where the ship - with a possible secret cargo - was located, and only had to "rescue"it and come up with a cover story when the world's attention became focused on the vessel.
       One outstanding mystery is why, if the ship was hijacked on July 24, none of the crew was able to get the word out before contact was lost a few days later."The vessel had all the necessary modern means of communication and emergency alarms, and was located in waters where ordinary mobile telephones work," said Mikhail Voitenko, editor of the Russian maritime journal Sovfrakht ."To hijack the vessel so that no one makes a peep - can you imagine how that could be?I can't."
       Mr Voitenko is one of the few commentators who have provided a trickle of information about the ship. He and other Russian experts have aired suspicions that the 98-metre freighter was carrying an undeclared cargo and that high-level state interests were involved, but so far nobody has been able to provide details. Rumours have abounded of an illegal cargo of drugs, weapons, or even nuclear material.
       What is known is that the Arctic Sea was docked for repairs in Kaliningrad before beginning its journey to Finland to pick up its cargo of timber. Kaliningrad is a Russian enclave between Poland and Lithuania which is the base of the Russian Baltic Fleet and a notorious black spot for smuggling.
       Mr Voitenko said he would comment no further and posted an emotional statement on his website."Thank God that it has all ended well. The crew is alive. I will say at once that I think it was right to draw attention to the situation surrounding the Arctic Sea ,"he wrote."I can't say for certain, but nevertheless suspect that there was a serious risk of the crew dying without attention being brought to this unique case. I can't say anything about the roots of this story and I don't plan to dig further ... I need to think about my own skin too. Understand that as you will."The Independent
       PHOTOS: EPA AND AFP
       STILL UNANSWERED: QUESTIONS ABOUT THE ARCTIC SEA
       Why did it take so long for the Russian authorities to respond?
       Concerns had been raised in Finland and Sweden by July 30 about the ship. By August 3 the mystery of its hijacking in Swedish waters had been raised in Lloyd's List. It was almost another week before the Russian authorities announced they were sending warships to search for the cargo vessel.
       Why did the crew tell Solchart,the company managing the vessel, that they had been hijacked but that the ordeal was over?
       According to Solchart, the crew was back in control of the vessel after 12 hours and continuing to Algeria.Those communications brought the realisation that a hijacking had occurred. Piracy was, until the Arctic Sea , non-existent in European waters, so any report of such activity was bound to get public attention. It was believed to be the first hijacking in Swedish waters since the 17th century. The vessel passed through the English Channel.
       Why did it take so long for the alarm to be raised?
       It is thought to have been three days before Solchart was informed of the Swedish hijack and in European waters an absence of contact for a day would cause concern. It was claimed that radio equipment had been damaged, but the crew are thought to have had their own mobile telephones which should have worked while the ship was close to the Swedish coast.
       Why, shortly after The Independent brought the disappearance to worldwide attention, did Russian President Dmitry Medvedev order the navy to take "all necessary measures" to find the vessel?
       The obvious answer is that the Kremlin wanted to do all it could to protect its nationals, the crew, but doubters suggest the president was worried about the fate of what the ship was carrying.
       Was the ship carrying a secret cargo?
       An illicit cargo might explain the hijackers' interest in the vessel the officially listed cargo of timber worth ฃ1 million was regarded as a most unlikely target for an armed gang. Arms, drugs and nuclear equipment have all been suggested as likely secret cargos.It has also been suggested that the boat was seized in a commercial dispute.
       Why did the hijackers wait so long before, reportedly,demanding a ransom?
       It was only at the weekend that the first demands were said to have been made. It could be that an earlier ransom demand has been kept secret.
       Were the eight men captured by the Russian warship the same who had carried out the hijack on July 24?
       It was suggested last week by the European Commission that the vessel was hijacked twice, once off Sweden and again off Portugal.Under normal circumstances this would be considered unlikely, but many of the circumstances surrounding the ship have resembled a fictional thriller in the past four weeks.
       What did the hijackers say to the Swedish police?
       The Swedish authorities are thought to have spoken to the hijackers at least twice, though not necessarily knowingly. On the first occasion, either using radio or the ship's satellite phone, they presumably thought they were speaking to a crew member and agreed because it was already beyond Swedish waters to wait to interview them on the vessel's planned return in August. The Swedish police communicated with the vessel last week but refused to divulge details of the conversation, or even to say if they considered the ship to be under the control of pirates.

AS LOAD FALLS, JAL SEEKS MERGER WITH CARGO RIVAL

       Japan Airlines yesterday announced that it aimed to merge its freight business with that of rival Nippon Cargo Airlines in response to a sharp drop in demand during the economic downturn.
       JAL, which lost US$1 billion (Bt34 billion) in the three months to June, said it had agreed to start negotiations with Nippon Yusen Kaisha, which owns the rival cargo firm, with a view to joining forces by April 1, 2010.
       "Following the collapse of the economy in the United States last autumn, the financial crisis that spread worldwide caused demand for air cargo transport to fall drastically and market situations to worsen," JAL said.
       A merger of the two largest cargo operators in Japan should enable them to make a profit, JAL said.
       The two airlines have already started code-sharing for cargo flights.
       "Further consolidation is expected to bring about more benefits such as allowing both companies to significantly reduce cost and to fortify their technical expertise," JAL said in a statement.
       JAL, Asia's biggest carrier, earlier this month announced drastic cuts to its flight services as it braces for a second staright year in the red.

Friday, August 21, 2009

Air cargo firms eye merger

       Japan Airlines Corp said it would start talks to merge its ailing cargo business with a unit of shipping firm Nippon Yusen as the airline looks to return to profit with the help of statebacked funds.
       JAL, Asia's largest airline by revenue,secured a deal in June to borrow 100 billion yen ($1.1 billion) from two statebacked lenders and three commercial banks and is now restructuring under state supervision.
       The company has already announced plans to cut domestic and international flights, but is under pressure to come up with more drastic cost-saving measures as it heads for its second-straight annual loss in the year to March 2010.
       JAL and Nippon Yusen said they would begin talks towards a potential merger of their cargo businesses in April, building on a code-sharing alliance between the two firms under which they mutually use each others networks to sell and transport cargo.
       "The air cargo business has been one of the hardest hit industries by the re-cession from last year," Hitoshi Oshika,corporate officer of Nippon Yusen, said at the briefing.
       The combination of JAL's cargo business with the Nippon Yusen unit, Nippon Cargo Airlines Co, would create a company with combined sales of about $3 billion and in control of roughly 30% of Japan's international air cargo market,JAL said.
       Its global competitors would include FedEx Corp and UPS.
       JAL reported a 50.9 billion yen operating loss for the year to March 2009 and has forecast a 59 billion yen loss for the current year, as it struggles to control costs and suffers along with other airlines due to a slump in global travel.
       Nippon Yusen has been looking for ways to turn around its air cargo business,which booked an operating loss of 17.9 billion yen in the year to March 2009 on sales of 79.4 billion yen.
       The shipping firm has implemented cost-cutting measures and replaced its fleet with more fuel-efficient cargo planes.

Maersk sinks into the red in first half

       The Danish shipping and oil group A.P. Moller-Maersk reported a deeper-than-expected first-half net loss as freight rates, volumes and oil prices fell and said second-half results would be similar.
       The world's biggest container shipping group, a barometer for the health of global trade, swung to a net loss of 3.02 billion Danish crowns ($577 million) from a profit of 11.98 billion a year earlier,missing analysts' average estimate for a loss of 2.91 billion.
       Even so, chief executive Nils Smedegaard Andersen did see some signs of improvement, with shipping volumes and rates starting to rise, though the shipping cycle would lag the global economic improvement.
       "The global economy is moving into a better situation - we are expecting growth going forward and the worst to be behind us," Andersen told analysts in a conference call.
       "Given deliveries (of vessels) in container shipping and tankers, it is likely that the shipping cycle will be somewhat slower in improving, but we are optimistic that the things that we are doing for the long term are right," he said.
       Maersk, a conglomerate whose businesses range from shipping to retail,said in a statement:"The result for the second half of 2009 is expected to be at the same level as the first half-year."
       The global economic crisis had a "severe negative impact" on the group's activities in the first half, said Maersk,whose container shipping fleet consisted of 501 vessels at the end of the first half.
       Freight rates and volumes for the group's container shipping activities were 30% and 7%, respectively, below the levels seen in the same period of 2008,Maersk said.
       Average rates for the tanker activities were considerably lower than in the first half of 2008, and the average price for Brent crude was 52% lower than a year ago.
       "Freight rates continued to fall in the second quarter, from the record-low level in the first quarter, but the curve flattened towards the end of the period," Maersk said.
       "The trend is now expected to reverse,with rate increases, albeit modest, in the third quarter of 2009," the company said.
       "Average oil prices are expected to be higher in the second half than in the first half," it added.
       Maersk operates the world's largest container shipping fleet, Maersk Line,and controls about 85% of Danish oil production in the North Sea, together with partners Royal Dutch Shell Plc and Chevron Corp.
       The group's oil and gas production rose 8% in the first half to 81 million barrels of oil equivalents and 50 new wells began operating during the sixmonth period, Maersk said.
       "Oil and gas output is expected to be a little lower in the second half of 2009 than in the first half, but full-year production is expected to be on a par with 2008," it said.
       Revenues fell to 127.39 billion crowns in the first half year from 148.37 billion in the same period last year, in line with analysts' average forecast of 127.33 billion.

Port project needs rethink

       The Port Authority of Thailand has never kept secret the fact that it would like to see the land it owns put to more productive use than simply playing host to the capital's biggest slum community. Now it has gone a step further and drawn up a five-year plan to split the area into four prime commercial and office zones requiring an investment of at least 20 billion baht. But, admit the developers, some fine-tuning still needs to be done.
       That is one way of putting it. Conflict resolution might be a better way because an abundance of such skills will be needed if there is to be a forced resettlement of the tens of thousands of people who live and work in the area. Then there is the certainty of a renewed showdown with the Klong Toey market vendors who are already incensed by the renovation efforts of a private concessionaire. That is a situation that should have been handled with a great deal more tact and diplomacy. Experience gained in the remodelling of other city markets should have taught the authorities that the velvet glove is more effective than the iron fist.
       Klong Toey slum dwellers are used to threats of eviction. Although there has been a welcome upgrading in recent years, there are continual problems with regular water supplies, electricity and waste removal,sanitation, hygiene, child care, education, crime prevention and health services because they have no legal right to the land they occupy. They are not there out of choice. This has been going on for over 50 years and will continue until the Port Authority gives serious consideration to expanding low-cost housing on more of its ample land reserves to absorb the community.
       Do that first and it will eventually pave the way for some of the big business developments it has in mind to improve the value of its assets. Right now its priorities are skewed. It is sheer folly to think it can turn the slum problem over to the Community Organisations Development Institute (CODI) and expect it to resettle so many people, probably far away from the area in which they work, in a relatively short space of time. Without proper planning and a suitable time frame, such an attempt would quickly come to grief. It would be reminiscent of the mass evictions and attempted resettlement of slum dwellers on the city's outskirts two to three decades ago. Those resettled could not find work deep in the suburbs or afford to spend hours in a long commute to their old jobs so they just abandoned their new locations and moved back to their old ones.
       The underfunded CODI works through the respected Ban Mankong home-building and land-sharing projects to replace the slums and avoid forced relocations. But progress is slow. Its sister project is Ban Ua-arthorn which was initiated by the National Housing Authority and involves the private sector. These projects were touted as the solution to the shortage of affordable accommodation and, while there were some successes,Ban Ua-arthorn schemes gained notoriety as showpieces of corruption. This took the form of ill-fitting doors,roofs prone to blow away in the wind, holes and cracks in foundations, walls and ceilings, dangerous electrical outlets and all-round substandard construction. It can only be a matter of time before such low-quality, but not inexpensive, public housing projects revert to slums again, completing a vicious circle. Ban Mankong projects,on the other hand, are community-based, better organised and hold out real promise for the future.
       Although the economic downturn caused migration patterns to slow and people to return home as factory jobs dried up, communities such as Klong Toey seem unaffected and likely to be with us for a long time yet.

Arctic Sea crew, hijackers arrive in Moscow

       The crew and suspected hijackers of the Arctic Sea cargo ship arrived in Russia yesterday after a maritime saga peppered with piracy and the hint of espionage.
       Russian warships found the merchant ship in the Atlantic Ocean off the Cape Verde islands on Monday and Moscow said eight people - nationals of Estonia,Latvia and Russia - had been arrested for hijacking the vessel.
       Ilyushin-76 military planes carrying 11 of the 15-member Russian crew and the men suspected of hijacking the Maltese-registered ship arrived at the Chkalovsky military airfield outside Moscow, local news agencies reported.
       The suspected men were then taken under guard to Moscow's high-security Lefortovo prison.
       Russia says the men had hijacked the ship on July 24 off the coast of Sweden and then threatened to blow it up if their ransom demands were not met.
       After heading through the English Channel in late July, radio contact was apparently lost and the 4,000-ton ship did not deliver its cargo to the Algerian port of Bejaia on Aug 4.
       Power plant tragedy
       The death toll in a Russian power plant accident rose to 17 yesterday after three more bodies were found, and harrowing escape stories emerged from the few survivors.
       Over 1,000 rescue workers searched the massive Sayano-Shushenskaya hydro-electric plant in southern Siberia for the 57 people who remain missing and are feared dead. Yesterday they pumped out the remaining water from the damaged engine room to try to find more bodies.
       A powerful blast on Monday blew out walls and caused the power plant's turbine room to flood. Three of the plant's 10 turbines were destroyed.

Hijacked ship was "continuously tracked"

       The Arctic Sea cargo ship "never disappeared" and was continuously tracked from its hijacking last month until the Russian navy said it had retaken the ship on Monday, the Malta Maritime Authority (MMA) said.
       The ship's disappearance from radar after leaving a Finnish port on July 23 sparked an international search, but the MMA said "investigators always knew of the ship's whereabouts".
       Swedish, Maltese and Finnish maritime authorities decided not to disclose any sensitive information "in order not to jeopardise the life and safety of the persons on board and the integrity of the ship", the MMA said. Russia said on Tuesday it had arrested eight men for hijacking the Arctic Sea after the Russian navy took control of the vessel at an undisclosed location believed to be off the west coast of Africa.
       The official story is the Arctic Sea was sailing from Finland to Algeria with a crew of 15 and a cargo of timber worth 1.16 million (55.8 million baht).