The obvious advantage of overseas scrapping in developing nations was reduced cost to the government. However, this reduced cost was not a result of skilled labors and improved efficiencies; rather, this reduced cost was due to cheap labor and accompanying lax labor and environmental rules found in developing countries. In effect, the U.S. government was supporting an industry abroad that touted low wages and minimal regulation as an advantage.
During the 1970s, the world’s ship scrapping industries were located primarily in the Unites States, Spain, Portugal and Italy. By the early 1980s due to environmental regulations, and
recycling industry had shifted to Taiwan, South Korea and China. In the late 1980s, the market had shifted again for the same reasons to find even far greater opportunities for cost externalization. Today, the world ship scrapping market is dominated by India, Pakistan and Bangladesh.
The Navy eliminated their foreign vessel sales program in 1982,134 while MARAD continued to
throughout the 1980’s and early 1990’s. From 1983 to 1994, MARAD’s ship disposal program sold 212 vessels to foreign buyers for breaking on the beaches of South Asia (see Table 10). During this same period, only one MARAD vessel was recycled domestically.
I n 1 9 8 9 , d u r i n g t h e c o u r s e o f a n o r m a l occupational safety inspection Navy at a
shipyard, significant quantities of solid-matrix
discovered in various shipboard applications, including electric cables, felt gaskets, rubber mounts, adhesives and paints.135 This discovery made the export of naval vessels to foreign
EPA, 2001; A Guide for Ship Scrappers: Tips for Regulatory Compliance; Appendix A, A-7 134
RAND Report, Appendix C, Polychlorinated Biphenyl in Vessels. 135
ALTERNATIVES TO OCEAN DUMPING
shipbreaking yards a violation of the Toxic Substances Control Act (TSCA), which prohibits the export of PCBs under the PCB distribution in commerce rule (40 C.F.R. §761.20(c)) and
export for disposal rule
§761.97). While the EPA acknowledged the illegality of transporting vessels overseas for disposal purposes, the EPA failed to enforce the
enforcement discretion to permit the export of 80 MARAD vessels from 1989-1994 (see table below).
In 1994, fleet reduction progress slowed dramatically as a result of EPA’s enforcement of the TSCA ban. As the backlog of ships awaiting disposal continued to grow, so too did storage and maintenance costs for the deteriorating obsolete fleet. To address the growing costs associated with the backlog of ships, Congress included a statute in the National Maritime Heritage Act of 1994 to require all unassigned NDRF vessels to be disposed of by September 30, 1999, later extended to 2001 by the National Defense Authorization Act of 1998 (Public Law 105-85), in a manner that maximizes the return to the United States. 136
Ships are driven directly up onto beaches in South Asia where they are broken down by hand. Image Source: Flickr user naquib under creative commons agreement: http://www.flickr.com/photos/naq/2316285684/#/
Government Accountability Office, Federal Surplus Ships: Government Efforts to Address the Growing Backlog of Ships Awaiting Disposal; October 1998 136
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