Ministry of Land, Infrastructure, Transport and Tourism Maritime Cluster in Japan - Shipbuilding and WP6 - Shin Otsubo Deputy Director-General Maritime Bureau Ministry of Land, Infrastructure, Transport and Tourism (MLIT)
Ministry of Land, Infrastructure, Transport and Tourism
Maritime Cluster in Japan
- Shipbuilding and WP6 -
Shin Otsubo
Deputy Director-General
Maritime Bureau
Ministry of Land, Infrastructure, Transport and Tourism (MLIT)
Maritime Clusters in the World
3
Stavanger
(Norway)
Concentration of shipbuilding and
universities specializing in offshore
energy development
Birthplace of marine insurance and
classification society;
concentration of information-
related industries
London
(U.K.)
Rotterdam
(Netherlands)
Biggest European port; accounts for
60% of inland water transport;
Biggest European port for
cruise; concentration of
shipowners
Piraeus
(Greece)
Singapore
Concentration of trade and
financial business in Asia,
bunkering
These clusters have their own specialized strengths.
Characteristics of Japanese Maritime Cluster
Japanese maritime cluster has a wide range of
marine-related activities and competitive core
activities.
Core activities: shipping, shipbuilding,
marine equipment, port, etc.
Marine-related activities: education,
financing, broker, legal services, etc.
4
Overview of Maritime Cluster in Japan
5
Maritime industry
Non-core Maritime industry 20 billion USD
Core maritime industry: 109 billion USD
Industries close to maritime 1 billion USD
Bro
ker,
consultin
g
Marin
e
insura
nce
E
ducatio
n
Marine
development Offshore Fishery Marine
leisure Research
Relevant industries
11 billion USD
Waterway mgmt
1 billion USD
Ship mgmt (part of shipping)
Shipbuilding
27 billion USD Retails Classification
Society
Ship repair
3 billion USD
Marine equipment
1 billion USD
Port transport
18 billion USD
Parts supply
for ships Storehouse
Logistics
Public
services Finance
Legal
services
Trading
House
Staffing
services
1 bln USD
Shipping
47 billion USD
Waterway
services
Steel
Grain
Electronics
Non-ferrous
metal
Car
Oil
Utilities
Others
Paper
making
Total sales of the Japanese maritime cluster: 141 billion USD (2011).
Value added: 47 billion USD (2011).
Source:
Japan Maritime Center
Ship machinery and equipment
11 billion USD
Coast
guard
6
9 billion USD
75 % Japanese Shipping
88 % (fleet) Japanese
Shipbuilder
25 billion USD
Ocean-going: 47 billion USD
Maritime Transport Sea farer
Marine
insurance
Trading
company
Classification
Society
Finance 71 %
Japanese Shipbuilder
95 % Japanese Ship
Machinery Industry
Source ; final report “New Comprehensive Policy on Shipbuilding Industry”
Ship management
company
Core Activities of Japan’s Maritime Cluster
Ocean-going:
Companies: 210
Employment: 6,000
Companies: 1,100
Employment: 85,000
Companies: 670
Employment: 41,000
Concentration of shipyards in western Japan
◆The shipbuilding industry is concentrated in Western Japan.
◆In many local cities, a large portion of economies depend on shipbuilding.
Source: Clarksons Research,
Japan Ship Machinery & Equipment Association
出典: 製造業全体は、経済産業省「平成25年工業統計調査」 造船業は、国土交通省調べ
Share of shipbuilding in local economy
出典:製造業全体は、経済産業省「工業統計調査」
造船業は、海事局調べ
30%
伊万里市
23%
長崎市
36%
玉名郡
18%
佐世保市
17%
三原市
35%
丸亀市
35%
佐伯市24%
臼杵市
22%
仲多度郡
24%
今治市
81%
西海市
Tamana:36%
Saeki:35% Nagasaki:23%
Saikai:81%
Sasebo:18%
Marugame:33%
Imabari:24%
Usuki:24%
Nakatado:22% Mihara:17% Imari:30%
Imabari Maritime Cluster
Source: Commission of maritime city interaction in Imabari city (2014)
• National Maritime College
• National Institute of Technology
Ship
construction
522
Imabari 19 %
Share of
shipbuilding
companies which
have office is in
Imabari 34%
Imabari 940
Largest as shipbuilding
Ship
building
Seamen’s training
Financial institutions
Ship
machinery
Shipping
Biggest
maritime city
in Japan
Maritime
Cluster
Largest as shipowner
Ocean-going
vessls
2,566
Local banks
focusing on ship
finance
Education base
for seafarers
Marine equipment maker: 160 Related industries
BARI-SHIP maritime exhibition
comparable to Posidonia/ Nor-shipping?
Economic ripple effect of shipbuilding industry 産業名 影響力順位
その他の自動車(トラック・バスなど) 1
乗用車 2
鉄鋼 3
自動車部品・同附属品 4
自家輸送 5
船舶・同修理 6
自動車整備 7
金属製品 8
その他の輸送機械・同修理 9
プラスチック・ゴム 10
化学製品 11
はん用機械 12
パルプ・紙・木製品 13
電気機械 14
情報・通信機器 15
航空輸送 16
電子部品 17
業務用機械 18
生産用機械 19
鉱業 20
飲食料品 21
建設 22
その他の製造 工業製品 23
水道 24
繊維製品 25
非鉄金属 26
農林水産業 27
窯業・土石製品 28
情報通信 29
水運 30
Shipbuilding is one of the economies
which have large economic ripple
effect; ranked as 6th in 49 industries.
Economic ripple effect of shipbuilding
• Ratio of economic impact of
shipbuilding to total economy is
about 3.
Shipbuilding is a core part of Japanese
Maritime cluster.
Rank Industry
1 Trucks, buses
2 Cars
3 Steel
4 Car Equipment
5 Shipbuilding
and repair
--- ---
30 Shipping
Ranking of
“Economic Ripple Effect”,
by industry in Japan
Induced total production value /
Ship production value
Characteristics of Shipbuilding
• Large economic impact
– High spillover effect
– Employment in local cities
Many emerging countries are trying to develop the
shipbuilding industry.
• Cyclical industry: booms and slumps, depending on
the shipping market.
– Time-lag between order and delivery of ships; coupled
with volatility of shipping market, speculative orders may
prevail.
– High exit barrier: facilities difficult to use for other
purposes, loss of employment feared OVERCAPACITY
Developments of the Global Shipbuilding
Shipbuilding is cyclical: short booms followed by longer slumps.
million GT
0
2000
4000
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12000
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10
20
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110
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015
Other
Europe
Korea
China
Japan
Seaborne transport volume
Constructed too much
0
20
40
60
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140
2000 2002 2004 2006 2008 2010 2012 2014 2016 …
million GT
Negative Effects of Overcapacity
0
20
40
60
80
100
120
140
160
180
2005 2007 2009 2011 2013 2015
million $ bulker(capesize)
bulker(panamax)
tanker(VLCC)
tanker(Aframax)
• Neworders drop sharply and stay low for a long time
• Low level of ship price remains for a long time
Vessel price Neworders
Fleet surplus keeps freight rate low, keeping ship prices low, too.
Excess capacity, once emerged, does not go away easily.
(Jan.~Sep.)
What happens during shipbuilding depression?
Policy coordination among shipbuilding
countries is essential to establish normal
competitive conditions: OECD WP6
◆ Due to large economic impact and long slump of
shipbuilding, governments tend to protect
shipbuilding in their countries. Subsidies, loan, debt forgiveness, etc. inconsistent with
international rules
◆ However, since global shipbuilding industry is a
single market, governmental support inconsistent
with international trade rules in one country will
distort the entire global market.
Efforts by WP6
Core mandate of WP6:
Establish normal competitive conditions in the global
shipbuilding industry
1960s - 1980s: Non-mandatory instruments
General Guidelines for Government Policies in the Shipbuilding
Industry
General Arrangement for the Progressive Removal of Obstacles to
Normal Competitive Conditions in the Shipbuilding Industry
1994: Mandatory instruments; tailor-made for shipbuilding
Agreement Respecting Normal Competitive Conditions in the
Commercial Shipbuilding and Repair Industry: not entered into force
2000s: The 2nd attempt for the mandatory rule, with China
Negotiation for new shipbuilding agreement: failed
Role and challenges of WP6
Role
Time has passed, but the significance of the WP6
mission unchanged: Establish normal competitive
conditions.
Challenges
Address the excess shipbuilding capacity.
Back to the basics: re-confirm the market principle.
Let the productive ones survive.
Adjusting the capacity may be painful. The main
government role is to reduce the social costs.
Learn from the past, while more and more
countries wish to develop shipbuilding industries. • Brazil, India, Indonesia, Philippines, etc.
Viewpoints for Sustainable Maritime Industry
Key words for sustainable development of the
maritime industry Environment, safety, innovation, productivity, human
resource, etc.
Japanese “Maritime Cluster” grew together with
local economies. Not overinvestment; enough care
for education and training, stable employment.
Model of “sustainable” maritime industry!
“Fair competition” continues to be an indispensable
element for sustainable development of the maritime
industry due to its nature of “single market“. More for WP6 to accomplish