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North to tap into growing world air cargo industry (4/02)

By Ian Ross A multitude of business and trade opportunities exist with air cargo, according to a preliminary draft of a logistic consultant's study on the Sault's transpolar initiative.
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By Ian Ross

A multitude of business and trade opportunities exist with air cargo, according to a preliminary draft of a logistic consultant's study on the Sault's transpolar initiative.

Since returning from Russia in late February and studying an early draft of the consultant's work plan, Sault Ste. Marie Mayor John Rowswell says he has "every confidence (the trans-polar initiative) will be successful" in transforming the North into an air freight-handling hub. The plan calls for North Bay to work with three Russian cities to bring the project to fruition.

The preliminary draft of the report prepared by InterVISTAS, a Vancouver logistics firm, says there are "significant volumes" and opportunities for the Sault and North Bay to siphon off a fraction of the world's air cargo now flying into congested North American airports.

The body of the report, which presents a snapshot of the growing world air cargo industry indicates a variety of air compatible products such as fashion goods, auto and aviation components, computer and electronics parts, precious metals, jewelery, medical instruments, vitamins, chemical and plastic products, tools, fabrics, even nuclear reactors, which can be shipped by air in both directions over North Pole routes.

Once the consultant's final report is out in late April, Rowswell says he will have "the cards in hand" plus a business plan to go market this pan-northern initiative to the world.

"Selling this to the world, that's going to be the harder matter, but at least I will have all my cards and know what cards to play when I talk to the air carriers, logistics companies and countries as to what Sault Ste. Marie and North Bay can offer," Rowswell says.

The completed report will identify flows between North America, Europe and Asia and include trade data on volumes moving between key markets to be potentially served by North Bay and the Sault.

The next stage is identifying what airlines are flying air cargo and how the north can put together a sufficient business case to justify going after some of that cargo, says Joe Sniezek, the city's long-range planner.

About 47 potential air cargo carriers fly from Europe to Canada each day, with more than 20 carriers flying daily from the Pacific Rim countries.

Much of that cargo is carried in the bellies of passenger aircraft, thus eliminating the north for that business, and other dedicated freight carriers have existing hubs and infrastructure in larger airports, he says.

The task is to identify those carriers without hubs that are expanding into the marketplace and go after them with an attractive and cost-competitive package.

North Bay's Jack Garland Airport has a 10,000-foot former air force runway to land large transport planes, while approvals are in place to further lengthen the Sault airport's 6,000-foot runway by 2,000 feet.

Rowswell says his courtesy visit to Russia "scored big points" with his hosts should any air treaty issues arise in the future.

Rowswell spent his February trip meeting with mayors, diplomats and development officials in the eastern Russian cities of Vladivostock, Bratsk, Yakutsk and Krasnoyarsk signing letters of co-operation in a pledge to work on this venture and other business opportunities.

The selected cities would serve as refuelling points on three air routes being examined for movement of goods back and forth between Northern Ontario and Asian-Pacific Rim destinations such as New Delhi, Hong Kong, Singapore, Philippines, Taiwan, Korea and Japan.

"They are as anxious as we are as to the outcome of the study that's underway," Rowswell says.

Sault Ste. Marie and North Bay will be the proposed hubs on the Canadian side, shipping goods imported from Asia to midwestern states and throughout Ontario.

Rowswell did tour some airport facilities and was assured by Nav Canada, the private sector company that runs Canada's air navigation system, there would be "no problem" with Russian air traffic control systems should air cargo flights get underway as early as next year.

"My understanding is navigational matters will be overcome," he says and many issues of concern about moving aircraft safely within Russian airspace "are essentially behind us."

"I've been assured they can accommodate all of the flights we can throw at them," says Rowswell. "From a business point of view, Nav Canada is encouraging transpolar."

But whatever progress Rowswell made in the transpolar initiative was lost in an embarrassing leak to the local media with an angry exchange of e-mails between Rowswell, CAO Joe Fratesi and councillors over travel expenses and a perceived lack of consultation with council.

"There's no question the mayor of Sault Ste. Marie is pushing staff and council," admits Rowswell. "And sometimes I don't follow the right process, but the opportunity could be missed if we do not jump on it right away.

"In my first part of the term, yes, I've been using that business philosophy and pushing hard but a lot of things are happening now.

"Now that the ball is rolling and things are starting to move, now is the time to try and follow proper process."




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