The inspections and delays of commercial vessels started on April 29, 2017, with Russia not explaining the reasons for conducting inspections of ships, regardless of flag (except Russian one), which are sent to the ports of Mariupol and Berdyansk through the Kerch Strait.
On May 24, 2017, the restriction of parameters for the passage of vessels that follow from the Black Sea to the Azov Sea and the return direction under the arch of the transport bridge through the Kerch Strait were announced: length – 160 meters, width – 31 meters, sediment – 8.0 meters, air draught – 33 meters (on average, the dimensions of the vessels processed in the Ukrainian seaports of the Azov region amounted to: length – 175 meters, width – 27 meters, sediment – 9.6 meters).
The seaports of the Russian Federation have not suffered negative consequences due to the restriction of the parameters of the vessels, since the depth of their water area does not allow the passage of dimensional vessels, including Panamax type.
On June 29, 2017, the restriction and full prohibition of navigation of vessels other than naval vessels of the fleet of the Russian Federation and the technical fleet in connection with the construction of the Kerch Bridge, that is, unilaterally blocked the Kerch Strait were announced from August 1 to September 30, 2017.
On November 25, 2018 military actions of Russian border guards carried out an armed attack and arrest of 3 ships of the Ukrainian Navy, blocked the passage for Ukrainian ships through the Kerch Strait.
Economic implications for Ukraine
Restrictions that arose in connection with the construction of the Kerch Bridge, partially cut Azov ports from the markets, increased the cost of goods and logistics of export shipments, which led to the unstable operation of the ports of Berdyansk and Mariupol, inhibition of their development, decrease in the profitability of enterprises of the metallurgical industry of the region , increasing social tension and loss of traffic flows, primarily iron and metal;
There were significant difficulties with the passage through the Kerch Strait of the vessels of the type `Handysize`, `Tanais Dream`, `Tanais Flyer`, `Panamax`, going towards the Berdyansk and Mariupol seaports; The estimated number of such vessels to the ports of the Azov region is approximately 150 per year. Mariupol Sea Port is unable to find 144 vessels with which work has been established.
As of April 29, 2018, the Russian Federation detained for inspection about 445ships, which went to the ports of Mariupol and Berdyansk, including 9 ships under the Ukrainian flag. Reviews of ships sailing from the Kerch Strait to the destination ports are carried out from one to two times. The number of unreasonable inspections of ships irrespective of the flag increases.
Ship owners bear significant unwarranted costs due to delays and simple vessels, which negatively affects the attractiveness of Ukrainian ports, the growth of the cost of transportation and the timely execution of contracts for such transportation.
The average duration of the inspection procedure for Russian border guards is 32,7 hours. At the moment, some ships are waiting for a survey of more than 10 days, the cost of simple vessels, depending on their parameters is from 5 to 15 thousand USD daily.
In 2017, Ukrainian ports of the Azov Sea did not receive about 1,6 million tons of cargo and 213 million UAH income. Starting from 2014, the annual fall in volumes of cargo handling in the Mariupol Sea Port in comparison with 2013 amounted to an average of 15 to 30% (incl. coal and construction cargoes – more than 6 times, cast iron – more than 3 times, metal and grain – 2 times, etc.)
Since 2017, the fall in volumes of cargo handling in the Berdyansk seaport compared to 2016 amounted to about 25% (including ore – almost five times, ferrous metals – more than three times, grain cargoes – more than two times, etc.). At the end of 10 months in 2018 the profit of the port is 0. During the eight months of 2018, the Mariupol and Berdyansk seaports’ processing decreased by 563,500 tons, which resulted in losses in the amount of Hr 166.6 million/
The social situation in the ports of Mariupol and Berdyansk worsens. The average number of employees will be as of October 2018: the port of Mariupol – 3,200 people, the port of Berdyansk – 1,035 people. A four-day working week has been introduced in Mariupol seaport for four years, and a four-day working week has been set up on Dec. 1, 2018 at the Berdyansk seaport. Currently, all possible measures are taken to avoid the reduction of employees and the deterioration of the corresponding payments, while the situation is worsening every month.
Conclusions to mitigate the risks
The Russian Federation committed an aggressive act and violated international law, that directly threatens the national security of Ukraine, implements targeted measures to reorient the transit flows of Ukraine, and gradually exclude the national transport system from the network of service traffic.
As a result, despite the attempts of the Ukrainian side to counteract the consequences of the aggressive actions of the Russian Federation, the socio-economic situation in the maritime ports of Mariupol and Berdyansk was critically aggravated.
Taking into account the foregoing, the United States and the European Union shall strengthen the sanctions pressure on the Russian Federation, including the possibility of applying restrictive measures to the maritime merchant ports of the Russian Federation, especially in the Azov Sea.
Ukraine needs to invest in critical infrastructure of Azov region, increase transit capacity of roads (Mariupol – Zaporyzhia) and railway (Kamysh Zorya – Volnovakha), as well support sustainability of Azov Sea ports and challenge the Russian actions in international courts.
Viktor Dovhan is the deputy minister of infrastructure of Ukraine.
