Bangladeshi shippers tap hubs to avoid Aussie air freight ban

Bangladeshi shippers tap hubs to avoid Aussie air freight ban

Shippers in Bangladesh are finding new ways of getting their air cargo to Australia after the government Down Under slapped a ban on shipments heavier than 500 grams being carried on freighters and passenger planes from several countries, with the South Asia garment-producing giant among them.

The Australian government imposed security restrictions on Dec. 19 that prohibit airlines from carrying any cargo into the country that has originated from, or transited through, Bangladesh, Syria, Yemen, Egypt and Somalia.

Bangladesh Garment Manufacturers and Exporters Association Vice President Mohammed Nasir said members were concerned about future business with Australia.

"We met the top Australian garment sourcing companies in Dhaka to express concerns as there is a risk of losing significant business if the ban continues for long," Nasir told the Dhaka Daily Star. The association held talks with Australian retailer Kmart and global garment companies Woolworths and Target about the ban.

There is vigorous trade between Bangladesh and Australia with garments enjoying zero-duty access to the fast-growing market. Of the $607 million in products Bangladesh exported to Australia last year, almost 90 percent comprised apparel shipments, according to the country’s Export Promotion Bureau.

While in tonnage terms, the majority of apparel shipments were transported by ocean, the higher value finished products travel by air, as do clothing samples, a critical component of the apparel supply chain.

Bangladesh began working on diplomatic efforts to have the Australian embargo lifted, but shippers and airlines were already on the case. Trade always finds a way, and as long as the shipments are cleared at an intermediate airport and a new airway bill is issued, the goods can continue on to Australia without fear of being rejected.

Exports to Australia are now being carried via hub airports, with the majority travelling through Singapore, and some through Hong Kong, where they are reconsigned with new AWBs.

Paul Golland, Australian Federation of International Forwarders chairman and FIATA vice president, explained. “Australia gets a lot of its clothing from Bangladesh and some of this comes in by air. This will now be subject to the embargo, which means either moving the cargo by road or sea to another country and then having that country, say Singapore, clear the cargo and then rebook it on as local goods.”

Golland pointed out that the air cargo from Bangladesh could not be transshipped at a third party airport because the original house AWB would still be in use.

This was spelled out in an Australian government FAQ using Hong Kong as an example. The advisory said if the air cargo was transferred between flights at Hong Kong airport, also known as a tail-to-tail transfer, it was considered as originating from Bangladesh and would not be allowed. If the cargo cleared customs in Hong Kong, and was subsequently sent to Australia, it was considered to be air cargo originating from Hong Kong and would not be subject to the ban.

The government advisory said the air cargo ban was a preventative security measure based on its understanding of the threat and risk environment in the named countries. It added that there was no information to suggest any specific threat for flights to or from Australia.
 
Contact Greg Knowler at greg.knowler@ihs.com and follow him on Twitter: @greg_knowler.