In giving his E-freight update, Peter Chong, director IATA Cargo Services Asia Pacific noted that “great strides” had been made since 2006/7 and by next year 20 documents representing 64 per cent of paper volume will be converted to electronic format. In 2009 the number will be 16 with Dangerous Goods being converted later this year. E-freight was implemented in three new Asia Pacific locations last year, including South Korea, Australia and New Zealand and since 31 December 2008, 18 locations and 25 airports have gone ‘live’, including South Korea, Hong Kong, Australia and Singapore. “Japan will go live later this year and that will see a huge jump in volumes,” Chong said.

The goal is to expand in three ways – the number of locations, the number of documents and expanding penetration in countries where the system is already live. The target is to reach 80 per cent of international freight in each airport where E-freight is live. This year will see three more locations in Asia Pacific: Malaysia which went online at KLIA in end-May; Japan which will go live in the first week of July; and Taiwan with two locations – Taipei and Kaohsiung.

By 2010 IATA is hoping to have 44 locations and 76 airports including the top five air freight markets representing 80 per cent of international trade, up and running with E-freight. Chong also acknowledged that some markets in the Asia Pacific region are going to be “very difficult” to implement E-freight. These include countries like Myanmar, Cambodia, etc. and specifically countries which have not ratified the Montreal Convention (MC99) such as the Philippines, Thailand, Indonesia. Thailand he noted, is currently drafting its own national legislation which essentially mirrors MC99 and that willlikely enable E-freight to proceed there.

E-freight discontent
But moving from Chong’s presentation to the round table discussion, it quickly became clear the deep level of discontent amongst FAPAA members with the E-freight initiative. Walther Nahr, FAPAA Honorary Secretary and representative of the HK Association of Freight Forwarding IATA matters and Logistics (HAFFA), expressed the widespread concern over the low level of volumes being processed under E-freight. “We are extremely concerned about the low volumes. There are only a few thousand shipments going by E-freight when there are tens of thousands of air freight shipments each day through Hong Kong,” he said.

He also raised the ongoing issue of banks requiring the original airway bill in order to obtain letters of credit, of which he noted that 30-35 per cent of shipments from Hong Kong are on letters of credit. Saying he was not aware of this problem, Chong pledged IATA’s support in trying to solve the issue with the banks. He also asked for FAPAA’s support in getting as many fowarders as possible to participate in the programme.

“What is the benefit?”, asked Nahr. “There is a benefit for airlines not freight forwarders,” because it means extra IT investment costs for forwarders. “If there is no financial benefit for forwarders, I can assure you that the volumes will remain in the thousands around the world,” he added. Singapore Aircargo Agents Association (SAAA) delegate, Alec Koh cited the IATA-touted global savings from E-freight, of US$4.9 billion per year, saying: “We support the initiative, but it must be beneficial to forwarders as well.” He noted that it was easy for the ‘big boys’, the Schenckers, the DHLs, etc as they had extensive technology already in place. For smaller shippers there was added cost of scanning paper documents into electronic form.

Chong responded that IATA had carefully examined the issue and there were cost-savings benefits for shippers. “We looked at this, I don’t know what the issues are, you have to let us know otherwise we can’t help you,” he said. “We challenge forwarders to work with us and participate in making changes in the programme,” he added.

FAPAA secretary general Brian Lovell noted that IATA was perhaps being too overly ambitious in trying to switch the industry over to a full-slate of edocuments in a short period of time. “I suggest that IATA focuses on just three main documents first and get it kicked along and worry about the 13 other documents later.”

CASS consultation
Although not his specific area, Chong gave a brief update on CASS noting that Pakistan’s PIA came online in May and Emirates is expected to be online soon. And discussions were currently underway with Vietnam Airways. While members are having various difficulties with the CASS system, Lovell highlighted the fact that there is no requirement in IATA’s procedures to consuult forwarders on issues pertaining to them.

As such FAPAA will work with FIATA to press IATA to make a commitment in writing stating that the airline organisation will “make it a practice” to consult forwarders on issues like CASS, E-freight, security, etc. Chong noted that it was already a practice for IATA to doso within the Asia Pacific region.