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Cargo Security - The End of the Line

Incorporating security into the entire supply chain will create significant benefits for the air freight industry. Governments must act quickly

The thwarted Yemen package bombs discovered by authorities in October 2010 were a sharp reminder that cargo, as well as passenger airlines, can become a tool of the terrorist trade.

The packages were destined for the United States so it was no surprise that Homeland Security Secretary Janet Napolitano responded with enhanced screening measures for air freight. Printer inks and cartridges—used to disguise the incendiary devices—suddenly became high-risk items and those above a certain size were banned from US flights.

Plugging the gaps in such situations is understandable. But a robust security framework that can account for requirements across the entire supply chain offers far greater advantages for all parties in the long term.

“Now is the time for governments and industry to work together on a practical strategy and develop enforceable solutions,” insists Des Vertannes, IATA Global Head of Cargo. “Governments understand that they can’t cut off commerce. Nor can they be purely reactionary to security threats. An efficient trade lane can be very secure as well. The areas are not mutually exclusive. In fact, they go hand in hand.”

Secure freight

Air cargo security obviously needs to appeal at state level. Assisting countries that don’t yet have a registered shipper program, or that face particular difficulties with airport and storage security, is the first task ahead for IATA’s Secure Freight project. The basic concept involves securing a package at the most appropriate point in the supply chain. Depending on the shipment and how it is being handled, that may be at source or even when it is palletized.

Secure Freight is a big undertaking, as it needs to be part of civil aviation legislation, but the benefits are clear. The project takes best practises from existing known shipper programs, such as those in Australia, the United Kingdom and the United States, and incorporates them in a harmonized blueprint that is applicable on a global scale. Not a quick fix for a particular security problem, Secure Freight allows industry and states to adapt to modern and future environments at a strategic level.

Secure Freight was successfully piloted in Malaysia last year. “For the first time, the regulator, the shipper, the airline, the ground handler, and the airport operator sat together to discuss and consolidate all the requirements to meet the varying world standards on cargo security,” says Shahari Sulaiman, MASkargo’s Managing Director. “The trial has given an insight on how a good process can be further improved.” Importantly, since implementation of Secure Freight, MASkargo reports zero mishandlings.”

Secure Freight was due to be implemented in Egypt in 2011 but political events have shifted focus. The United Arab Emirates will be the next country to use the program. “It was an obvious choice,” says Vertannes. “It has two major airlines and hubs that connect directly with Europe and the United States. Secure Freight will be appreciated by everybody involved as it will bring significant efficiencies.”

A third country will adopt Secure Freight before the end of the year in accordance with the IATA Board target of two new partners in 2011. Kenya, Chile, Qatar, and Mexico are all interested. Once Secure Freight has been an integral part of a national aviation security program, states can be endorsed by the international community. Avoiding additional security measures at the origin and destination airport saves time, money, and resources, and improves a country’s competitiveness.

Industry initiatives

Galvanizing the supply chain to deliver ideas that can be taken to governments will add value and supplement existing work. For example, double screening—checking items that have already gone through a robust screening process—obviously undoes any good work in improving efficiency. It adds cost, not security.

“We need governments to certify better screening technology to supplement the supply chain approach,” says Giovanni Bisignani, IATA Director General and CEO. “We do not advocate 100% screening. Intelligence is the most effective tool to combat terrorism and it must support risk assessments. And where there is a need for screening, we need the technology to screen pallets and oversize items. And I would add that governments must cooperate on mutual recognition of standards to avoid redundant checks.”

The United States is often held up as the prime instigator of unnecessary screening but there have been huge steps forward recently. Douglas A. Smith, Assistant Secretary at the US Department of Homeland Security, was at the recent IATA World Cargo Symposium, showing the strength of the event and US willingness to engage with industry. “He came to listen and to advise air freight leaders on the latest US thinking,” says Vertannes. “The United States is obviously critical to global goals.”

IATA is also involved with the US Transportation Security Administration and other like-minded states searching for solutions to the security issue. All agree the International Civil Aviation Organization must be the vehicle for recommendations as this will ensure worldwide dissemination and adoption of standards.

One immediate possibility is a template for security documentation. Currently, each airline has a different interpretation of how to conform to local and international regulations, meaning forwarders receive multiple forms with different configurations. Collating this disparity is time consuming and expensive. A template would harmonize the data supplied and benefit the whole supply chain. Crucially, it would provide the data necessary to manage risk, such as sender details, shipment information, and screening processes. “This information would populate a database, which could further enhance risk management processes,” notes Vertannes.

It isn’t just a top-down approach; industry participation includes the International Federation of Freight Forwarders Associations to ensure the views of all members of the supply chain are included. Providing the necessary information and education will help them understand and benefit from the latest initiatives.

Although involving smaller companies is often portrayed as a challenge in known shipper programs, Vertannes suggests the bigger players have bigger headaches. “They deal with Internet trade and eBay packages, so there is an enormous logistical challenge for them,” he says. “But a harmonized, robust air cargo security regime that incorporates the Secure Freight principles would bring enormous benefits.”

Electronic information

Far from counteracting productivity, many security developments demand efficiency improvements. E-freight is set to save the industry $4.9 billion a year and completely removes paper from the supply chain. Importantly, e-freight gets data from the shipper to customs and border protection agencies, which in turn are always part of national security strategy. In other words, e-freight can bring shippers into state-level risk management. Alongside supply chain security and screening technologies, better use of electronic information will contribute to a robust framework for cargo security.

The IATA Board goal for 2011 is to achieve 10% volume on existing e-freight trade lanes. It is a tough target because paper has become a mindset and it is difficult to enforce change, even when the need is understood. “But we’re very confident,” says Vertannes. “When you dovetail e-freight with security developments it gives the project and potential participants an added incentive to act quickly.”

Some 20 paper documents are being replaced by electronic messaging. The purpose is to enable fast, transparent, reliable, and environmentally-friendly cargo communication across the entire supply chain. Felix Keck, Managing Director for Traxon, says these parameters are also relevant to improve cargo security. “In this sense e-freight will not only help cargo security but can be seen as a prerequisite,” he suggests. “Intelligent tools need to be established to manage such data-flow. Efficient information interchange tops the list of future challenges. It’s a development no one in the airfreight supply chain can afford to ignore.”

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