National crewing: from gray to white

Ukraine is a sea power. By this we mean the country’s coastline, ports, and ships that enter and clear our harbors. But it is not this that has brought Ukraine fame on the international sea-related market. The personnel are our forte. About 80,000 Ukrainian seamen annually take their workplaces in the deckhouses and technical bays of ships worldwide. By the level of professional training, sociability, and discipline, Ukrainian seamen rank second or third in the world, just behind Filipinos and sometimes the Chinese. Incidentally, officers account for 75 percent of all the hired personnel. The training of specialists of this level requires a serious system of education, years of practice, and a huge aggregate experience in this sector. Our country already has this and can give it an impetus for further development if we manage to establish a sound system of business, social, and legal relations in the merchant marine sphere. This article considers the problem crewing, i.e., recruitment of specialists for the crews of foreign and national vessels. In what does it differ from the practice of employment abroad in other sectors? What benefit does this country derive from the army of seamen who serve under various flags? Who stands behind the high-profile scandals about crews “abandoned in foreign ports”? What is required today from the people who have decided to link their professional destiny with the sea? The Day put these and many other questions to Viacheslav KYSLOVSKY, sea captain, director general of the All-Ukrainian Association of Crewing Companies, and Ihor SAFIN, managing director of the company V-Ships (Ukraine), professor at the Transport Academy of Ukraine.

“UKRAINE MUST SIGN MLC”

Mr. Kyslovsky, you are well known in Ukraine as a navigation specialist who has served on various types of vessels for more than 30 years. You were also the first Soviet captain who hoisted the Ukrainian flag on your ship, weren’t you?

V.K.: “Yes, when Ukraine proclaimed its independence, I was captain of the Kremenchuk, a large German-built ship. We called at the port Dubai, the United Arab Emirates, and heard the news of the events in our homeland. This gave us inspiration. We made a flag of Ukraine out of the blue-yellow signal flag ‘I cannot alter my course’ and maneuvered in the port’s water under it. But later, without me, the Kremenchuk restored Soviet symbols on the grounds that international reference books did not have Ukraine’s insignia so far.”

We are forgetting the time of transition from a Soviet to an independent state. But that moment keeps many secrets that have led to the current situation in Ukraine’s merchant marine.

V.K.: “Of course, we should not forget that all today’s problems and achievements were conceived in that period of time. The Black Sea Shipping Company, or Blasco for foreign representation, was one of the world’s largest Soviet companies. When the USSR was collapsing, the company’s pro­perty was managed by Moscow. The latter in fact launched the transfer of ships to other countries and into other hands. This caused the problem of a large number of seamen and too few employment opportunities. That period saw the emergence of a non-governmental sector of specialist recruiting – the first crewing companies. Seamen used to work for peanuts in the USSR. When I was already the captain of a big ship, I earned about 100 dollars a month, although people holding the same position were paid 2,000 to 3,000 dollars on the world market. A colossal difference in wages marked the beginning of radical changes in this field.”

Let us see what crewing is in terms of socioeconomic categories. For example, can we say that the companies that recruit Ukrainians for seasonal and permanent work abroad are a dry-land analogue to crewing? For everybody, on land or at sea, is seeking high wages.

V.K.: “There is nothing in common except for a motive to earn more. Crewing is part of the international maritime industry. As the word implies, we are busy forming crews. By contrast with low-skilled specialists, who are much in demand in various countries, the people we deal with are maritime professionals. They have graduated from specialized, usually higher, educational institutions, have the longtime experience of operating ships or their systems, know the English language, international law within the framework of their duties, and the experience of communicating with representatives of va­rious nations. Officers account for two thirds of all the selected specialists. But there are also some particularities at the level of ordinary sailors. These people intend to climb up the career ladder. Many of them study and do their internship on ships. For this reason, crewing is entirely different from recruiting companies or even employment agencies. Our duty is not only to choose personnel, but also to test them for fitting the job.”

We have all heard about periodic scandals with our seamen. They may end up abandoned in faraway ports without means of subsistence or fall hostage to pirates or to economic litigations. Are the hirers, the crewing agencies, to blame?

V.K.: “Both yes and no. Such things come up in the black and gray hire sectors, where ship owners evade laws to economize on the crew’s remuneration. People put out to sea without the owners’ guarantee, social and legal security. And anything can happen at sea. Natural phenomena, economic problems, political and military conflicts directly affect the life of seamen. Therefore, it is important for them to choose under what flag, where to, on what conditions, and with what consequences to sail. This increases the importance of crewing as an official sector, where international standards and laws are valid. I mean that Ukraine should join the internatio­nal Maritime Labor Convention (MLC).”

As far as I know, ratifying the MLC is a top priority goal for Ukrainian seamen. Let us clarify this problem from the angle of national importance.

V.K.: “The MLC, one of the International Labor Organization’s Conventions, was adopted in 2006. It is based on the modern standards of all the existing international maritime agreements and recommendations. In other words, it is comprehensive. The document that regulates labor relations entered into force on August 20, 2013, after being signed by 30 countries that account for more than a third of the world’s gross marine tonnage. By the end of 2014, 65 states had ratified the MLC. In other words, 80 percent of the world’s commercial vessels meet international standards. According to British statistics, it is about 50,000 vessels of various types.

“The convention consists of chapters that describe minimal requirements for seamen’s onboard work, conditions of their employment, accommodation, meals, social security, and medical care, and, what is more, responsibility of ship owners, including the state, for the fulfillment of these norms.”

Does this mean that if Ukraine signs the MLC, it will no longer stay in the gray zone of seafaring and will touch the clear waters of this business?

V.K.: “In general, yes. But, like in the case of other international commitments, every country brings general rules into line with its own legislation. The point is that maritime and economic hierarchies are entirely different. For example, there are more vessels that sail under the flags of Malta, Morocco, and the Marshall Islands than under those of all European countries and Canada. Liberia, which accounts for 11 percent of the global tonnage, was the first to ratify the MLC back in 2006 and the United Kingdom did so in 2013. No matter what the labor market situation is, Ukraine must sign the MLC. We no longer have time or possibilities for a compromise.”

As far as I can see the problem, our ship owners are not yet prepared to cater to the personnel under international standards, especially in terms of wages. On the other hand, the seamen who have sailed under other flags, cannot legalize their incomes in their own fatherland, where remuneration taxes are very high.

V.K.: “Yes, but it is not the only question. This also involves many knotty problems of our reality, such as work conditions, social security, and pension provision. They remain unsolved not only in the maritime sector, but, as long as we are integrated in the international system, we must hurry to adopt a lot of laws and standard-setting instruments which will make labor relations in the merchant marine lo­gical and transparent. This task is difficult for our country not only because we are lagging behind with reforms and have a host of unresolved military, political, and economic issues. As the capital of a sea po­wer, Kyiv has very little experience in managing the sector that was subordinated to Moscow in the Soviet era. There are not many specialists who know the international maritime law and the sea-related market development situation. Besides, they stay in Odesa and Mykolaiv. Therefore, there is a problem of governmental management and parliament’s awareness of shipping and the life of seamen. Far from all know what mechanisms work in this sector and what benefit the country can derive from it. Tens of thousands of our seamen annually represent Ukraine in every nook and cranny of the globe. They invest at least a billion dollars in the eco­nomy of Ukraine. At a very conservative estimate, more than half a million people are associated with the sea. These are families of seamen and port workers, college students and faculty, and merchant marine pensioners. All they demand from the state is well-balanced decisions in the field of their economic and civil rights.”

Mr. Kyslovsky, you have just mentioned that the fleet personnel are being drawn from Ukraine’s littoral regions. It is quite clear because maritime educational institutions, family traditions, and other things are concentrated there. But boys in the Carpathians or Sloboda Ukraine also dream of the sea. To what extent is the profession of seaman attractive today and is it true that wages here are so high that this makes up for the long months of isolation?

V.K.: “I was invited recently to speak to students of the Hetman Petro Konashevych-Sahaidachny State Academy of Water Transport. I spoke about the sea, my experience, and changes in the seaman’s life in the 21st century. An attentive audience is a precise barometer of pub­lic interest. So, I know that ocean navi­gation continues to attract people. Today, a high-skilled captain or first mate earns 10,000-15,000 dollars a month. This is the upper limit. Ordinary seamen earn 1,500-3,000 dollars. I emphasize that remuneration depends on the level of qualification. From the financial angle, it is very lucrative to go to sea because seamen bear almost no expenses, and when they come back from a voyage, they possess the funds that are many times higher than annual wages of specialists on land.

“But, of course, there are also some hardships. It is not easy to live far away from the family for 6-8 months a year. There are major psychological stresses, particularly during storms. Vessels no longer lie at anchor in the roads or stay moored for several days, so there is not always an opportunity to visit exotic places. Life has changed. It is more dynamic and full of responsibility and all kinds of stresses. But, judging by the fact that the inflow of applicants to maritime educational institutions does not abate, this does not scare young people. More and more boys from various regions of Ukraine study at the Odesa National Maritime Academy which I know very well. This also reflects the profession’s prestige on a national, not a regional, scale.”

PEOPLE FOR THE SEA AND THE SEA FOR PEOPLE

Ihor Safin, who comes from a family of seamen, is a captain, a teacher, a scientist, and the managing director of the Ukrainian branch of V-Ships, the world’s leader in maritime management, founded by the well-known Odesaite Aleksandr Vlasov. After running away from Soviet reality, entrepreneur Vlasov began to deal with carriage of goods by sea in Italy and turned a small private firm into an international maritime brand. Today, V-Ships is represented by 79 offices in 33 countries, 1,200 vessels, and 25,000 seamen, a third of whom are Ukrainians. This share is the personal merit of Safin who managed to raise the recruitment of Ukrainian seamen from 700 to 7,000 a year in 10 years.

Mr. Safin, what trends are typical of today’s maritime transport? What kind of seamen and specialists, and for what types of vessels, does this worldwide sector need?

I.S.: “The global labor market has been short of officers, including captains and first mates, mechanics and electrical mechanics in the past few years. There is a shortage of 20,000 specialists of this category. It is a big pool, as the British say.

“Bulk carriers make up the majority of all the world’s commercial ships. There are more than 15,000 of them. The number of freight vessels is much lower – up to 11,000. There are twice as few container carriers – about 5,000 – and still fewer roll-on roll-off ships for transporting land vehicles, such as automobiles, tractors, and railway cars. Together with passenger vessels, they number 4,000. Overall 2,000 oil and gas tankers are plowing the seas. They play a special role in the redistribution of energy resources on the globe. Incidentally, oil platform specialists are more and more in demand. It is also a sea profession because oil shelves may span for hundreds of kilometers offshore. There are also fishing trawlers and auxiliary vessels which also need seamen. Carriage by sea still remains the cheapest transport. It is a dynamic industry which plays a huge economic role in the international labor division system.”

We know from your company’s experience and from the information of crewing companies that Ukrainians hold a sizable share of this market and that our seamen enjoy authority and are much in demand among hirers. But what hinders from rivaling with the proverbial Filipinos?

I.S.: “The Republic of the Philippines, an insular state with a population of twice that of Ukraine (102 million), gives the global merchant marine 200,000 of its citizens. And it is not pure chance or the economic consequence of a low labor cost. On the contrary, Filipino seamen and related specialists earn the same wages as our personnel do, or even higher. But they have a number of undisputable advantages that will win the heart of any ship owner. Firstly, the Philippines have a state-sponsored program of employment abroad. Taxation, social aspects, and the system of personnel training comply with international laws and regulations. Secondly, Filipinos have an excellent command of English, the second official language in their country, – the result of being an autonomous part of the US for a quarter of a century. Thirdly, Filipinos do not drink alcohol and are very industrious. They rarely argue about the distribution of duties on board the ship. Our ‘sea rivals,’ the Chinese and Indians, are also superior to us in knowing the [English] language.”

As we have raised the language problem, why do you think people in the post-Soviet countries are unwilling to learn foreign languages? In this country, it is the problem of politics, education, and, naturally, culture.

I.S.: “I think it is the result of a decades-long isolationist policy. The Russian Empire was not integrated into the world economy. It used specialists and manpower inside the country, without supplying any onto the world market. In the USSR, any kind of contacts between Soviets and foreigners were looked down upon. A foreign language was for a long time an object of decoration, rather than of everyday use, in our schools and universities. Why should you learn what is not used? This also applied to the languages of the constituent republics. Unfortunately, Ukraine’s system of education has borrowed this approach. The curriculum at the Odesa Maritime Academy assigns 1.5 hours a week for English. Of course, this is too little. Students fill this gap by means of additional classes and practice in mixed crews, where they have to speak English. Nevertheless, the problem still remains.”

Alas, it is not only about the maritime sector. I wonder why the programs of Ukraine’s integration into Europe do not embrace educational and cultural spheres, only focusing on the “implementation” of European documents into our milieu which does not know the languages and customs of Europe.

But let us go on about sea matters. We spoke about training the personnel, without broaching the problem of building our own fleet at which our seamen are supposed to serve. Or is it a too simplified approach?

I.S.: “It’s not so simple. Well-developed states have their own fleets. It is profitable practice, for a ship’s service life is 20-25 years. Given an investment of 30-40 million dollars (a medium-tonnage vessel), payback begins after 7 years of service. In other words, a ship fetches profit in the course of two thirds of its life. You will agree that not all factories are as cost-effective as this. Besides, this does not depend on the domestic economic problems. But, on the other hand, having built 10 or even 20 vessels, we will only employ 700 to 800 seamen, i.e., fewer than a 100th part of their total strength. Therefore, we should encourage working on other country’s ships and, at the same time, not lose the prospect of creating a fleet of our own.”

If investing in our own ships is as lucrative a business as you have described it and besides, keeps our shipyards busy, why nobody is investing in this sector? Why do the unforgettable Ukrainian oligarchs, who are fighting for newspapers and factories, not want to have steamships, as a poet said?

I.S.: “They may have some under the flags of other states. It is not beneficial for a ship or a seaman to sail under the Ukrainian flag. Our law lags behind the international one and does not stimulate remuneration. Anywhere else, seamen earn their wages in a convertible currency – dollars, pounds, euros, while in this country wages are assessed in hryvnias according to the scale of per diems abroad. This means that a Ukrainian seaman on a Ukrainian ship will earn three or four times as little as he could do on a foreign vessel. Nor will the ship owner get his hard-currency earnings in the same amount as his foreign counterpart does because he is subject to the Ukrainian hard-currency regulations. Other countries also have this kind of problems, we are not an exception here. These are solved at the expense of ‘flags of convenience.’ In the parlance of maritime management, this term applies to the countries that stimulate ship owners. They are Panama, Liberia, and Malta. A fifth of the worldwide merchant marine is registered there. In other words, a flag on the mast is a symbolic thing in all the meanings of the word.”

Mr. Safin, you were a captain in the recent past, and now you form ship crews. How do you think is the seaman’s life changing? Is it easier and simpler now? It is not so hot in the tropics thanks to air conditioners, the separation with you family is not so painful because you can see each other ‘on Skype…’ Is it right?

I.S.: “I wouldn’t say so. High-tech makes man’s life comfortable, but it also places a heavy tax on his free time, nerves, and thoughts. I can remember myself 20 years ago, when we could stay in ports for a week, while the ship was unloading. We had enough time to go sightseeing. But today many do not go ashore. Ship owners apply high-techs to use the vessel as effectively as possible. Naturally, this tells on the way the crew feels and can seriously aggravate the situation. This is why seamen’s wages keep growing, for this eases hardships – not only storms, jolting, and a longtime isolation, but also the work as part of a foreign crew, where there are no friends or even compatriots. One must be able to endure the voyage. Ship owners prefer the seamen who are ready to stay on board for up to 8 months. But most of our colleagues prefer to work for four and rest for at least three months. This also creates a competition during the recruitment. In a word, the seaman’s life is not the best, but it is generous. This is what I would call our work, which in on the increase even in crisis years. This means that the sea helps all countries to keep their economy afloat.”