The container security initiative costs,implications and relevance to developing countries

Following 9/11, the Department of Homeland Security established the Container Security Initiative (CSI) programme in 2002 in response to the threat from terrorist attacks involving weapons of mass destruction transported by cargo containers. This project establishes the tracking and targeting of ‘high risk’ containers and their subsequent scanning with X‐ray machines before loading onto the U.S. bound ships. To date, 44 of the world's largest ports have agreed to become CSI‐compliant, the majority of which are located in industrialised countries, while developing and least developed countries are under‐represented. CSI‐eligibility requires that ports represent a considerable volume of U.S. bound container traffic and invest in container scanning devices. Every non‐intrusive inspecting device (NII) costs several million dollars while investments in IT and existing infrastructure often triple the compliance costs. Containers originating in a CSI port are expedited through U.S. customs, representing a comparative trade barrier for exporters from non‐CSI ports. Thus, CSI acts as a tool for the U.S. to improve security, while representing a challenge to exporting countries' market access. This article provides an evaluation of the impacts this plan will have on the export competitiveness of developing countries. It reviews the potential benefits this programme offers in terms of improved trade facilitation, as well as proposing recommendations for its expansion to include developing countries. Copyright © 2006 John Wiley & Sons, Ltd.