Despite its name, the American Association of Port Authorities (AAPA) is a truly international organization. Its 160-plus member ports hail from throughout the Western Hemiäphere, from Alaska to Argentina. It's a constituency whose main business is facilitating global commerce; it is fitting, then, that President and CEO Kurt J. Nagle has a long history in promoting international trade.
After earning a master's degree in economics from George Mason University, Nagle went to work in the Office of International Economic Research at the U.S. Department of Commerce. From there, he became director of international trade for the National Coal Association and assistant secretary for the Coal Exporters Association. This year, he celebrated his 25th anniversary with AAPA, which he has headed since 1995. He also serves on the Executive Committee of the Propeller Club of the United States and is a former commissioner of PIANC, the International Navigation Congress.
Nagle speaks quickly but quietly, and his style is low-key—it's hard to imagine him getting angry or confrontational. But that calm demeanor doesn't mean he lacks passion for his subject. His enthusiasm was clearly evident when he spoke with DC Velocity about AAPA's four-part mission—advocacy, professional development and education, information sharing and relationship building among members, and promoting public awareness of the role and economic value of ports.
Q: You have a background in international economics and trade development. Does that help you to work more effectively with and on behalf of AAPA's members?
A: It is relevant, and it has been helpful. In addition to my education, earlier in my career I worked for the U.S. Commerce Department's international trade branch on global economic issues. I also worked on international trade and related competitive issues while at the National Coal Association.
Certainly, that background has been helpful in recognizing that we're competing in a global economy and in understanding how that relates to our industry and to our members' competitiveness. It helps to understand what we have to do in the port industry and in the country as a whole about the issue of infrastructure investment. It is absolutely critical that we invest in infrastructure not only within the ports themselves but also in the connections to ports on the land side and on the water side to enable our country to be competitive.
Q: Your staff has changed in recent years. What kinds of expertise have you brought on board, and why?
A: Our backgrounds and experiences reflect what is most important and relevant to our members and to our industry. First, we've added some resources that focus on initiatives like SHARE, which stands for Seaports of the Hemiäphere Allied in Relationships for Excellence. One of the key missions of this organization is to help members share lessons learned, best practices, and information about what works and what doesn't. ... We started SHARE about six years ago to enhance members' ability to share that kind of information. This also includes processes that facilitate electronic communication, such as our newsletter and webinars for education and for committee meetings.
More recently, we have increased resources for our "awareness" initiative, which is geared toward increasing recognition and understanding among policymakers—whether in Washington, in the various national governments throughout the Hemiäphere, or at the local level—of the critical importance of ports to national, regional, and local economies. We've also increased staff relative to U.S. transportation policy. With the surface transportation reauthorization coming up, it's critical that we work closely with government to develop a transportation policy that will help us as a nation to not only improve efficiency but also reduce congestion and improve air quality.
The third area where we've made staff changes is in adding someone who focuses on the Latin American delegation. His job is to ensure that issues that are particularly relevant and important to Latin American members are addressed and to facilitate the exchange of information. We also now have people on staff who have Spanish language and translation capabilities.
Q: AAPA's members include port authorities and managers from countries throughout the Western Hemiäphere. How does the organization meet the needs of such a diverse membership?
A: One way we do that is by ensuring that resources that are contributed by everyone are not being used for something that benefits only some of our members. For example, our U.S. advocacy and government relations efforts are segregated in terms of staff, budget, and funding. Only U.S. members fund those resources.
Another way is that about 20 years ago, we separated our organizational structure into four delegations: Latin America, the Caribbean, Canada, and the United States. The delegations' leadership is represented on AAPA's executive committee and on the board of directors. By having all of the delegations represented in the broader policy and leadership positions, we are ensuring that the association provides value and is relevant to ports throughout the Hemiäphere. Certainly, when ports in different countries are looking at information technology or at developing a terminal, there are a lot of similar issues, questions, and practices. I think that's what members are looking for from us: to facilitate that exchange of information and lessons learned, and to provide a network and clearinghouse.
Q: AAPA has developed a training and certification program for port managers. What are the goals of that program?
A: We started the Professional Port Manager, or PPM, program in the mid '90s. One of our key goals in the association is to enhance professional development. We also want to identify up-and-coming port leaders and provide them with the ability to develop their knowledge, skills, and relationships. These are all part of the PPM program.
About seven or eight years ago, we started a related program that includes issues that are particularly relevant to Latin American members. The program is offered in Spanish, or in Portuguese for the Brazilian ports.
This past year, we modified the regular program, which had been principally structured for individual study. We changed it to a class-based program; people now apply for a specific class and then go through the program together, for the most part, and we added group projects. That has really taken off. Our first class, the Class of 2014, started this year with 19 people. They've been together for two programs already, but there has been a lot of additional communication and correspondence among them. We're extremely pleased and excited by their enthusiasm and energy.
We have had about 80 people receive the PPM certification so far, and right now we have 150 total in the program. One of the requirements is a research project, a paper, or other type of project. ... Because our purpose is to educate and share information, we have made those papers and projects available so people can access and learn from them. This has been very beneficial to both individuals and ports.
Q: Transportation infrastructure is a hot topic in Washington now. Has AAPA been consulted on this issue? What are you telling Congress and the White House about how ports can contribute to efforts to revitalize the U.S. economy?
A: We definitely have been asked to contribute to the dialogue. Secretary of Transportation Ray LaHood very early on had a conference call with many of the transportation stakeholder organizations, and AAPA was asked to be part of that. ... In February of this year, Secretary LaHood held a port summit, where he invited port directors from throughout the country to talk to him personally on key issues related to ports. That was the first time something like that has been done.
We've had very good ongoing dialogue not only with the secretary himself but also throughout his department, and more broadly within the administration. ... Commerce Secretary Locke, the former governor of the state of Washington, where he was a supporter of the state's ports, is another high-level official in the current administration who understands the importance and value of international trade and ports. He also recognizes the need to have infrastructure that allows us to be competitive in international commerce.
The message we're giving them is that ports are literally economic lifelines. They are critical links that provide access to the global economy, to the goods consumers expect to be in the stores when they go shopping, to the parts and components manufacturers rely on, and to farmers' being able to ship their grain overseas. We need all of that to work efficiently in order to compete, especially with the president's call for doubling U.S. exports in the next five years.
Another thing we're stressing is that transportation infrastructure investment and projects provide not only short-term economic benefits and jobs, but also long-term benefits that can improve the entire system's performance and help our nation in terms of economic efficiency and competitiveness. There are also environmental benefits, because infrastructure investment can help to reduce congestion and airborne emissions. We think there needs to be a greater emphasis on freight transportation than there has been historically.
Q: The Panama Canal expansion is expected to change shipping and trade patterns. Meanwhile, the container shipping business has been very volatile. How are ports responding to such uncertainty—especially when these factors are beyond their control?
A: Economic conditions have had a significant impact on global trade, and obviously that has had an impact on ports' revenues and resources. Many of our members have had to undergo fairly significant belt tightening and look at reducing costs everywhere possible. But they still have to think about where to put their resources to manage through this. In many cases, ports are continuing to move forward with projects that will be needed when trade and commerce pick up again. These are long-term infrastructure projects that ports were building not for five years but for 30, 40, or 50 years down the road.
One of the things ports have become good at is strategic management—"adaptive management in uncertain times," as AAPA's former chairperson Geraldine Knatz called it. Ports are continually adapting their management strategies as situations change and evolve. Our members are looking at the Panama Canal expansion and other factors in international trade to determine what they mean for individual ports, as well as how to prepare themselves and adapt successfully to the new environment, whatever their role might be, whether as major load centers, feeder ports, or sites for handling specialized or niche cargoes.
Q: Exporters and importers—the ports' ultimate customers—say their top concerns are service quality, responsiveness, and efficiency. How can ports, which have limited flexibility because of their fixed infrastructure, ensure that they meet those needs?
A: Ports are doing everything they can to make their own operations and the things they have direct control over as efficient, responsive, and flexible as possible to ensure the ultimate customer's needs are met. But this issue gets into the less clear or less direct role of public port authorities. A lot goes on at ports involving participants in the logistics chain that public port authorities don't have direct control over, such as terminal operators if the port is a landlord, tugs, pilots, the Coast Guard, Customs, security, labor, the Army Corps of Engineers, and private railroads and trucking companies. Public port agencies can serve as a vehicle to help coordinate, collaborate, partner, and facilitate the broad range of interests in and around the port. This is critical to achieving efficiency and supporting the customer.
Ports are, to a larger extent than in the past, looking to take on leadership roles that extend far beyond the terminal gates to whatever impacts them and their customers. That includes transportation policy affecting landside and waterside issues that are not in their direct control. The port authority is playing an increasingly vital, expanded role that is not limited to the confines of its facilities.