GPI Global Policy Institute

 Since the Montreux Convention The possibility of accidents in the Bosphorus increased eightfold

 by Prof. Dr. Mustafa ILICALI

In recent years, the increasing volume of traffic across the Bosporus has unfortunately started to create new safety threats with each passing day.  While in 1936 only 17 ships per day were passing through the Bosphorus Today, the number is around 130.  In other words, since the signing of the Montreux Convention in 1936, the number of ships passing through the Straits has increased to approximately eight times the original amount. 13,370 ships passed through the Panama Canal in 2020. Each ship that passed paid an average toll of US $ 262,000.  Moreover, 18,829 ships passed through the Suez Canal in 2020, and the average toll per ship is US $296,000.  Based on the Montreux Convention, the fee charged per ship from the 38,500 ships that passed through the Bosphorus in 2020 is just around US $3,900.

The Turkish Straits System, consisting of the Bosphorus, the Marmara Sea and the Dardanelles, is undoubtedly one of the most important sea routes in the world. It is a system of geopolitical and geo-cultural bridges. With its location, connecting geographically Asia and Europe, the Bosphorus is of vital importance in terms of both the economy and the security of the countries bordering the Black Sea. The Straits System is the main trade route connecting countries of the Black Sea to world markets.

The importance of the straits system has always attracted the attention of powerful nations who want to dominate the region and motivated them to find ways to seize control of the straits.

The interest of the great states 

With the conquest of Istanbul in 1453, the straits domination by the Ottoman Empire continued until the first half of the 19th century.  During this long period of time, merchant ships of foreign states gained the right to pass through the Bosphorus for the first time- within the framework of certain rules, which are determined by the Küçük Kaynarca Treaty signed in 1774.  Afterwards, with the “Kale-i Sultaniye (Çanakkale) Treaty” signed in 1809, new rules applied, whereby passing through the straits was regulated by mutual agreements.  As a result of the Montreux Convention signed in 1936, “freedom to pass through the Straits” was accepted as a principle. The interests of the great states from all over the world on the region were furthermore increased after the end of the Cold War era and the dissolution of the USSR, which led to fluctuations in the geopolitical and geostrategic power balances. 

In addition to its strategic importance, the Straits have many unique features.  The most important of these is undoubtedly that the Bosphorus has witnessed the historical identity of Istanbul forming over the duration of three thousand years by curling between historical places and between two continents, curling and flowing down the middle of Istanbul which itself has been declared a World Heritage Site by UNESCO, fascinating observers along the way with natural beauty.

Cultural heritage is under threat 

In recent years, the increasing volume of traffic in the straits has unfortunately started to threaten the Istanbul environment with each passing day. While only 17 ships were passing through the Bosphorus per day in 1936, today this number is around 130 on average. To put it another way, since the signing of the Montreux Convention in 1936, boat traffic through the straits has increased to approximately eight times what it used to be.

Tanker crossings pose a great risk 

In the past years, not only the ship traffic has increased, but also, as a result of technological developments, the ship sizes have increased and their cargoes have changed. For example, while the ratio of ships measuring more than 200 meters to total passages in the Istanbul Strait in 2005 was approximately 5.5%, with roughly 3 thousand passes, this ratio has increased to upwards of 13% with 5 thousand ships by 2020.

Furthermore, 39% of these crossings by vessels sized 200 meters and up are made up of tankers carrying toxic, dangerous and explosive materials (such as crude oil, ammonia, liquefied gas, radioactive materials, and hazardous wastes). Tanker crossings correspond to approximately 22% of all crossings through the Straits in 2020 with nearly 8,500 total passes.

In addition to all of this, the amount of cargo passing through the straits continues to increase every year. While approximately 334 million tons of cargo passed through the Bosphorus in 2005, this number has reached 355 million tons in 2010, 398 million tons in 2015, and 457 million tons in 2020.  Compared to 2005, the total increase in 2020 is around 73%.

Unfortunately, the increases in cargoes consisting of hazardous materials follows the trend set by overall cargo increase. One third of the total cargo transported through the Straits consists of toxic, dangerous and explosive materials. To put in numbers, out of the 457 million tons of cargo transported through the Bosphorus in 2020, 143 million tons originate from the transportation of hazardous materials.  This increase continues to move in parallel with the increase in oil spillages in the ports on the Black Sea, especially since the 1990s.

At this point, we need to discuss the threats imposed by the increasing sea traffic in the straits and the benefits of ship crossings. Currently, the first thing that comes to mind is a possibility of an accident in the Bosphorus, and the second is the revenue obtained from strait crossings.  It is possible that an accident involving ships carrying hazardous materials can have disastrous effects on the Straits. Such a situation would undoubtedly endanger the lives of thousands of people living on both sides of the Bosphorus, as well as damage to the historical heritage of the city, the surrounding habitats and the local environment in ways that would be very difficult to compensate. Furthermore, the fact that a possible accident could halt the Bosphorus traffic for an indefinite period may also affect the commercial flow, which in turn could seriously hurt the economic interests of the countries in the region. Some other hazards recognized as originating from ship crossings include emissions and environmental pollution.

Right of free passage 

Emissions of harmful substances released during ship crossings have direct harmful effects on human and environmental health. Consider that the flue gas emissions released from approximately 40 thousand ships transiting through the Bosphorus in a year are 18,324 tons of nitrogen oxides (NOx), 2,138 tons of carbon monoxide (CO), 5,294 tons of sulfur oxides (SOx), 937,017 tons of carbon dioxide (CO₂), 692 tons of particulate matter (PM), and 693 tons of volatile organic compounds (VOC). [1]. Considering that approximately 4-5 million of the population of Istanbul lives within 3-4 kilometers from the Bosphorus, it is not difficult to understand how harmful emissions from ships threaten human health every passing day. When these emissions are combined with the emissions from the local maritime traffic in the Bosphorus, the danger becomes even greater.

Another important aspect of the issue is the income obtained from the ships passing through the straits. The framework of the pricing policy applied to the Bosphorus crossings is based on the Montreux Convention. In accordance with the agreement, merchant ships have the right of free passage and transportation through the straits without any formalities, day or night, regardless of their flag or cargo, within certain special limitations. It is sufficient for merchant ships that will pass through the straits to inform the relevant authorities of their name, nationality, tonnage, destination and origin. Merchant ships are obliged to pay the taxes and duties specified in the annex I (one) of the agreement while passing through the straits. Apart from this, they are not subject to any other financial liability.  On the other hand, pilotage and towage are optional.  Everything stated up to this point seems to be in order. However, when the subject is considered in detail, it can be seen that the tariffs determined by the Montreux Convention and the tariffs that have since been updated are not very satisfactory.

10 billion dollars lost 

According to the Montreux Convention, until the end of 1981 tolls to be collected were calculated by multiplying the amount of gold in 1 Gold Franc by the gram value of gold. For about 46 years, the tolls were collected accordingly, without any recorded objections or difficulties. However, the abandonment of the Gold Standard as an international monetary system has led the involved parties on a search. Since 1981 the transit fees collected from ships involved in non-stop transit through the straits have been calculated by taking the cost as it would have been when based upon the Gold Franc and multiplying it ten-fold. However, due to objections, this regulation was withdrawn, so that a 75 percent discount was made in the transit fees [2].  Along with this discount, the value of 1 Gold Franc was fixed as US$0.08063 for the purpose of calculating transit fees [3]. Consequently, Turkey is estimated to have lost 10 billion dollars in potential transit fees during the last 30 years [2]. However, if the tariffs were to be determined over the real value of the Golden Franc, the current light and rescue dues would increase respectively to 55.5 times 54.5 times their current prices.  Considering that Turkey earns an average of US$150 million per year from the straits in accordance with the current tariff, the adjusted number could exceed US$8.1 billion [4]

13,700 ships passed through the Panama Canal in 2020, generating US$3.5 billion of revenue [5].  Meaning, each ship that passed provided an average income of US$262,000.

18,829 ships passed through the Suez Canal in 2020, and paid a total of   US$5.56 billion in transit fees, with the average transit fee coming up to approximately US$296,000 [6].

The total fee charged per ship on the 38,500 ships passing through the Bosphorus for 2020 is just around US$3,900, in accordance with the Montreux Convention. This situation comparable to a citizen who owns a luxurious villa with a large and spacious garden in the busiest part of the city.  This citizen cannot interfere with dozens of vehicles that enter the garden of their house and park their vehicles due to the parking problem in the city. They cannot prevent the pollution of their garden and air by third parties. And they also cannot implement a reasonable price for parking to compensate for the damages done to their property. Someone else has dictated the price for using their property, ignoring that citizen’s free will…

References

1- Tokuşlu, A., & Burak, S. (2021). Examination of Exhaust Gas Emissions of Transit Ships in the Istanbul Strait (in Turkish).  Academic Platform Journal of Engineering and Science, 9(1), 59–67. doi: 10.21541/apjes.705918

2-Yayci, C. 2013. An Assessment on the Implementation of Gold Franc in the Framework of Montreux Convention. Bilge Strateji, Cilt 5(8), 149-167.

3-Demir, I.  2017.  Transition Fees (Charges and Fees) Taken According to the Montreux Agreement. VIII. Turkish Maritime Trade History Symposium, S.61.

4- Panama Canal Traffic Fiscal Years 2018 Through 2020 Retrieved      from:  https://www.pancanal.com/eng/op/transit-stats/2020/Table-01.pdf 7

5- Revenue generated by the Panama Canal from FY  2010 to FY  2020.  Retrieved from  https://www.statista.com/statistics/1003550/panama-canal-revenue/#statisticContainer%208

6- Egypt says commercial routes that threaten Suez Canal will not affect revenues. (2021, March 29). Arabnews. Retrieved from https://www.arabnews.com/node/1803351/middle-east.

 

Prof. Dr. Mustafa ILICALI Professor of Transport, Chair of the Transportation Engineering Department and UYGAR (Transportation Research Center) of Bahçeşehir University He graduated from Istanbul Technical University Faculty of Civil Engineering. He took up various roles in different units of the Ministry of Public Works for almost 4 years. He started as an assistant at Yıldız Technical University in 1979 and did his doctorate on Highway Engineering in 1988. He received the title of Associate Professor from Inter-University Council in 1994 and was assigned to the Professor Staff of Transportation in 2000. Between 1994 and 1999, the years in which President Recep Tayyip ERDOĞAN served as Istanbul Metropolitan Municipality Mayor, he acted as a Transportation Consultant, the Chief of Transportation and was a member of the board at certain municipal corporations. He was elected as Justice and Development Party’s Member of Parliament for Erzurum in 2002 and served as Deputy Chairman at Committee on Public Works, Reconstruction, Transportation and Tourism, member of Turkish delegation at Parliamentary Assembly of the Council of Europe, Head of Group at Turkey-Austria Inter-Parliamentary Union and Member of Central Decision and Executive Board of Justice and Development Party. He paved the way for many firsts at Bahçeşehir University between 2008 and 2015 and acted as the Founding President of the post-graduate program for municipalities and the first Transportation Engineering of Turkey. In 2015, he served as a Professor at Istanbul Commerce University Faculty of Engineering. He also acted as a consultant for Istanbul Metropolitan Municipality Mayor and various central units between 2007 and 2015. He was once again elected as Justice and Development Party’s Member of Parliament for Erzurum in the General Elections held on November 1, 2015. He is now  serving as the Bahcesehir University Chair of the Transportation Engineering Department and UYGAR (Transportation Research Center).

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