Maritime Growth Study: keeping the UK competitive in a global market. Is this the whole story?

According to Lord Mountevans, the Maritime Growth Study: keeping the UK competitive in a global market was the culmination of many months of work involving widespread engagement and detailed research. “The result is a ‘call to arms’ to industry and government to actively support and raise the profile of a vital sector that contributes significantly to the economy and which the nation relies on to meet its daily needs.” Lord Mountevans goes on to say that “the sector sometimes appears to be invisible to policymakers and the general public, with UK maritime services quietly keeping the world’s seaborne trade moving and keeping our supermarket shelves stacked, all with little fanfare or media attention.

In the end, this is a robust report that makes some very important points. Most of the key points are highlighted below in the bulleted section. But with that said, we must also recognize that to consider the maritime sector as a business sector is fine and entirely appropriate, but the reality is that the sector is more a barometer of overall economic success than a driver of national economic success. The maritime sector (much of it anyway) will better flourish when the UK is robustly importing and exporting and it will do less well when businesses don’t have as strong a need for those services. Yes, building and exporting maritime craft and services abroad is quite valuable, but instead this writing focuses on ports and logistics industry elements of the sector as defined in the report.

In our experience from around the world, we strongly suggest better integration between fundamental economic competitiveness work and transport-related industries and public policy and investment. Very few places “get this”, and even fewer are able to action. There is a reason that infrastructure spending and more focused efforts around issues like those about the maritime sector remain “invisible” as Lord Mountevans suggests in his transmittal letter. That is, in and of themselves these issues are of modest interest to a wide audience, but when they are portrayed as an integral element of say, an overall UK global manufacturing competitiveness plan, we would say that this could attract huge attention.

There are several regions in the UK that seem to fundamentally understand this and are seeking to action. In some cases, this remains fantastic rhetoric with some well-funded public marketing and promotion. We believe that it will take far more than marketing and promotion to “dial-in” a real 360-degree business plan, but frankly these are easy suggestions that are quickly adopted by the public sector. Unfortunately, this is a bit more complex than that, so it’s only part of the story. From the GLDPartners perspective, the very first step is to very clearly understand the science of why the UK can compete (or not) sector by sector. For good and bad, there can then be clarity and then focus on what should be done in terms of policy, public spending, opportunities for public-private partnerships, regulatory changes, workforce investments, etc. And marketing and promotion can support the specific business proposition and the support that government and business are making – that would attract enormous respect and attention from industry and infrastructure and development risk capital.

Unfortunately, this isn’t easy. It will require an integration of transport and economic development in ways that really will not have been seen before.   Beginning at a regional level could be the lightening rod to do this right, and then to amalgamate into a wider national plan.

Report Highlights: Maritime Growth Study: keeping the UK competitive in a global market

• the economic importance of a sector which not only includes shipping and ports, but also encompasses a wide range of other activities such as training, business services, engineering, manufacturing, research and development.
• the cluster draws inward investment to the UK, significant investment in new port facilities and job creation from international shipping companies basing their operations in the UK and world-leading maritime training institutions attract international students.
• the national cluster delivers substantial export income: world-class maritime business services serve international shipping companies and the UK exports world-class expertise and high value, complex maritime technology, systems and vessels all over the globe.
• the UK maritime manufacturing sector exports maritime products to most of the world’s major markets; from complex merchant and naval shipbuilding to ship’s chandlery and nanotechnology, the sector produces high quality products used in the global maritime industry at every stage of the supply chain.
• the sector that has a strong regional dimension which is helping to rebalance the UK economy. There are significant and growing clusters of maritime activities in locations all over the country. Cities such as Liverpool, Plymouth, Southampton, Aberdeen and Glasgow, as well as successful ports such as Felixstowe and Immingham.
• Research and development in the maritime sector is extensive, supported by the world class capabilities of UK universities and research institutes. The UK’s maritime research landscape is further enriched as a result of the high levels of small to medium sized enterprises (SMEs) at the forefront of R&D and innovation in maritime products and services.
• current estimates suggest that the direct contribution to the UK economy from the maritime sector, including marine industries, was at least £11 billion in 2012 (GVA)3. This is a similar order of magnitude to other important high value industries like the manufacture of pharmaceutical products (£13.3 billion GVA in 20134), the aerospace industry (£6.8 billion GVA in 20135) and the road freight industry (£9.4 billion GVA in 20136)
• the sector is global in nature, mobile and growing with ships carrying 80% of global trade. Seabourne trade is predicted to double by 2030 in-line with the forecast growth in international trade.
• the UK is ideally positioned to exploit these conditions and drive growth in the UK maritime sector. The evidence collected during the Study demonstrates that the UK continues to be seen by the international market as a world-leading maritime centre. It also shows that the UK remains highly competitive, particularly in the field of maritime business services, maritime education, training and skills and marine manufacturing, engineering and research. The UK maritime cluster’s contribution to the economy is already substantial and, with the right conditions, can be grown further.
• however, this potential growth and the UK’s international position cannot be taken for granted. In the face of increasing competition from fast-growing maritime centres in other countries the UK maritime sector must be willing to adapt, improve and change to successfully exploit these opportunities.
• the findings from the Study have helped to inform a vision for the UK maritime sector, where its future competitiveness is reliant on industry and government working together. This is to ensure that the UK is the world’s foremost maritime centre and a maritime nation that:
  • exploits the full range and depth of its maritime cluster to promote the UK’s position as the world’s leading maritime centre.
  • attracts inward investment in ports and other maritime business, contributing to both the national and regional economies.
  • sells its marine engineering and manufacturing expertise and innovation to shipowners and other maritime businesses around the world.
  • ensures that the world’s shipping industry chooses UK-based maritime business services, including maritime training, to support their global trading fleets.
  • draws the world’s shipowners to the UK, with more shipping operations being managed from here, creating UK jobs and with owners paying UK Tonnage Tax.
  • provides shipowners with a high quality, commercially-oriented UK Ship Register that promotes the UK brand, reinforces our maritime centre status and generates income for the UK taxpayer – the Flag of choice for quality owners.