(Bloomberg) — From the deck of their tanker, Captain Samig Nabiyev and his crew could see the smoke and fire rising over the Port of Beirut, 900 meters away. When the flaming warehouse exploded, the force of the blast knocked Nabiyev flat on his back.
“I thought I was finished,” said the 43-year-old Nabiyev, who’s worked on ships for almost 20 years. “We were all afraid for our lives.”
Nabiyev and the 11 other crew members weren’t supposed to be in Beirut on Aug. 4, the day of the disaster that killed around 200 people and wounded more than 6,000. Like the tons of ammonium nitrate that had eventually exploded in the port, they too had been abandoned by the owner of their ship, left to the discretion of local officials and insurers. No one on Nabiyev’s crew was hurt, but as they learned more about the explosion in the weeks to come, they recognized the same industry practices that had left them stranded for months.
Covid-19 has wrought havoc everywhere, but in the nominally regulated shipping industry it’s fueling a worrying practice: the abandonment of ships, cargo and seafarers with no way to get home. Dumping a vessel can create a nightmare of logistics, environmental hazard and human suffering, and yet owners — people at the core of an industry that touches almost everything in the supply chain — are rarely held to account. This year, cases of abandoned ships are up nearly 90% by even the most conservative accounting.
For people who work on land, this is unthinkable in the absurd — as if your employer went bankrupt and left you locked in a rapidly deteriorating office for the foreseeable future. But hundreds of seafarers like Nabiyev and his crew find themselves in exactly that situation, trapped aboard massive ships under the control of foreign ports. Some of the vessels could be sold for several million dollars, but the longer they sit, the further they fall into disrepair. With no one to take financial responsibility for maintenance or, eventually, safely dismantling a ship, some sit idle for years, clogging ports and threatening to leak fuel and waste. Some sink where they’re anchored.
“There are vulnerable laborers stuck on these ships, and there’s also a huge environmental risk,” said Ian Ralby, chief executive officer of I.R. Consilium, a maritime law and security consulting firm that works with the United Nations and governments. “There are larger issues here that if we aren’t watching today can blow up in the next decade.”
In most big, developed economies, when a business goes under, there are protections for workers, plus processes for dealing with stranded assets and jilted creditors. If necessary, authorities can step in. Those rules should apply to shipping companies, but the fragmented, global nature of the industry makes them nearly impossible to enforce. For example, a ship owner might live in one country, incorporate his company in another, and register his ship under the flag of a third. If he abandons it in a port that isn’t subject to global labor protections for seafarers, he’ll have the advantage of less oversight and, possibly, favorable legal outcomes.
“The decision by owners is not a chaotic one,” said Jan Engel de Boer, a senior legal officer dealing with abandonment at the International Maritime Organization. Some owners, he said, have become expert at working the system. “In many cases, it’s organized — the ship owners know what they can get out of it.”
The pandemic has, of course, made these problems worse. In addition to the seafarers working long past contract, caught between port restrictions and corporate cost management, the United Nations’ International Labour Organization counts more than 1,000 mariners who have been straight-up abandoned so far in 2020. Their ranks have more than doubled since last year. Cases, a proxy for ships affected, are up to 76 this year from 40, and the International Transport Workers’ Federation, the union that represents mariners, said there are more to come.
Still more never get reported at all. The MV Rhosus, the abandoned ship connected to the Beirut blast, never made it into the ILO database. Mohamed Arrachedi, the ITF network coordinator in charge of Arab countries and Iran, said he’s intervened in about 170 cases to help seafarers recover nearly $6 million in unpaid wages this year — up about 40% over 2019. If he can resolve cases quickly through direct negotiations with the ship owner, he doesn’t even report them to the ILO.
“The laws and regulations haven’t kept up with how modern and global shipping is now,” said Laura Carballo, head of maritime law and policy at World Maritime University in Malmo, Sweden. “The way shipping is set up makes these abuses possible.”
Nabiyev still isn’t sure how it all went so wrong. He’d been working at a government-owned shipping company in Azerbaijan for nearly 20 years when he got the job offer from Palmali Shipping, a Turkish company owned by the high-flying Azeri émigré Mübariz Mansimov Gurbanoglu. For six months, he’d earn $30,000 — more than six times the average per capita income, enough to move his wife and three daughters into their own apartment in the capital city of Baku.
“In Azerbaijan, everyone knows about Mansimov and how rich and famous he is,’’ said Nabiyev. “I thought it would be a good company to work for. It turns out it’s nothing like that.”
Shortly after he joined the ship last November, Nabiyev learned that some of the crew were already owed several months of wages. His paychecks never materialized either. The company told him that everyone would be paid at the end of their contracts — not the terms they’d agreed to. The captain and his crew felt there was nothing to be done, so they went on working, delivering sunflower oil from Aston Group, one of Russia’s biggest exporters, to ports in Europe and the Middle East. “The company made a lot of promises and we had to accept it,’’ he said of Palmali. “But they lied and lied.’’
Back in Istanbul, Palmali was in serious trouble. Gurbanoglu had been close to President Recep Tayyip Erdogan’s family and allies. Not anymore. In March, he was arrested for allegedly supporting a movement to overthrow the government, an accusation he denies. He’s now on trial, with prosecutors seeking a 15-year prison term, and his arrest threw his businesses into chaos. Authorities in the U.K. froze some Palmali assets after one of its lenders took the company to court.
Palmali did not respond to repeated requests for comment by phone and email. The company attested to Gurbanoglu’s innocence in a June press release, adding that “the Group is continuing to trade and operate as it has done previously.” Representatives for Aston, based in Rostov-on-Don near Moscow and a regular charterer of the stranded Beirut vessel, the Captain Nagdaliyev, declined to comment. The Management and Operation of the Port of Beirut couldn’t be reached for comment.
Nabiyev didn’t realize they’d been abandoned until May, when the vessel came into Beirut and the usual refueling company demanded $250,000 to clear an outstanding balance. Palmali refused to pay, Nabiyev said; the company ordered him to unload the cargo, then stopped responding to emails or phone calls. What remains of Palmali has cut off communication with Nabiyev. The ILO is tracking at least five other Palmali vessels stranded in Italy and Istanbul. In total, sailors on the ships are owed $1.5 million and counting, according to the ILO. Some haven’t been paid in more than a year.
Without fuel, the tanker — one-and-a-half times the length of an American football field — has been moved to an out-of-the-way berth in the port. By September, the crew was running out of food and fresh drinking water. They appealed to the authorities in Malta, the ship’s flag state, to the Beirut port, and to the vessel’s three Russia-based insurers. Eventually, the ITF sent three deliveries of water, fresh meat, ramen noodles, potatoes and rice.
When the fuel ran out, so did the power and electricity. The crew stored the meat in the refrigerator of a ship anchored in the next berth. Twice a day, they cooked on a makeshift stove on the ship’s deck. They used water from the ship’s tank to shower, wash clothes and flush toilets. When it got too hot in their cabins, the crew slept on the deck on cardboard and blankets. After 40 days, the ITF arranged a fuel delivery to restore power on board.
“We are living like animals,’’ said Nabiyev. “We are all depressed. We are all stressed and have health problems. Some talk about killing themselves if we are stuck here longer.’’ One morning, Nabiyev said, he found a noose hanging on the deck.
Over the last few months, Lebanese port and marine authorities have allowed eight crew members to go home, but they insist that four remain with the ship to ensure its safety. It’s an order, not a request: the port is also a border, and seafarers can’t enter without valid immigration and travel documents. Even if a crew member was able to get off the ship, coronavirus travel restrictions and the cost of a ticket are obstacles. Without government approval and financial support, leaving isn’t an option, and the August port explosion has made everything more complicated.
“Everyone is more sensitive now when it comes to abandoned ships because no one now dares to make a decision,’’ said Riad Kobaissi, an investigative journalist for Beirut-based Al Jadeed TV. “For example, they wouldn’t dare unload cargo from an abandoned ship because the Rhosus had a ‘bomb’ in it — even if this one isn’t carrying harmful material. There is also a lot of bureaucracy that could delay any resolution.”
The problem of abandonment has become so commonplace that the IMO met recently to develop guidelines for flag and port states to deal with vessels and their…