Shipbuilding in Argentina and Comparisons with Brazilian Case
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28º Congresso Internacional deTransporte Aquaviário, Construção Naval e Offshore Rio de Janeiro/RJ, 19-21 de outubro de 2020 Shipbuilding in Argentina and comparisons with Brazilian case Raúl Podetti, Asoc. Argentina de Ingeniería Naval, Buenos Aires, Argentina, [email protected] Summary This work presents the most relevant issues of Argentine Shipbuilding industry and compares certain aspects and policies with the case of Brazilian ship construction sector. It is based on the research presented for both industries at the “Blue Industry Collection”, available in full at www.industrianaval.com.ar It is structured into three parts: Industry, Policies and Future, in order to analyze the span of the century 1937-2036 (eighty past years and twenty projected). “Industry” chapter describes historical stages, main shipyards performance, competitive factors and the evolution per market segment, using Value and Employment as uniform comparison criteria. “Policies” discusses the reasons of being of this industry and the three roles of the State as Regulator, Owner and Builder. In the last case it compares state-owned yards with others in the region. In “Future” the key aspects to be solved are mentioned and a Projection is presented up to year 2036. After a general overview of the whole century of this industry, an Argentina-Brazil comparison is presented and discussed. 1. Introduction Most of this work was developed in tandeM Brazil and Argentina developed their shipyards in with My father with parallel reaching their respective MaxiMuM level of whoM I share a naMe, a activity by early 80s´. profession and a They collapsed in parallel as well, although passion for the construction of fine Argentina never stood up again due to the ships to add value to continuous application of the worst industrial our nations providing policies of all tiMes and latitudes. This is still today the case, keeping this industry in jobs and pride to our an undeserved underdevelopment status siMilar to people. the case of Many other activities in the country. At the tiMe we published our book Industria Naval The result is well known worldwide. Argentina, 100 Años, we jointly added up a century of professional work as Marine engineers. The focus of this work is on Heavy Ship Construction, froM the Shipyards’ point of view. 2. Industry One hundred years is the span analyzed in this 2.1. History of Shipbuilding in Argentina paper. In order to Make the Most of the potency The first shipyards in the region, gradually enfolded in historical experience, we go back soMe established along the basin of the River Plate eighty years, to 1937, when the Argentine Navy (1531), as well as inland, to Make use of the rivers decided to place a large order of navy ships in to sail their products down to Buenos Aires private and state owned shipyards. (Gonzalez CliMent, 1972). Leaving apart the very In addition, and so as to cover the tiMeframe in early days, the last eighty years (1937-2017) of which the sectorial policies proposed herein can Argentine Shipbuilding Industry history fall into the consolidate and yield results, twenty years are four stages shown in next graph (Fig.1) that shows projected into the future, until 2036. New Buildings Value delivered (Million of dollars) by argentine yards. 1 Figure 1 - New buildings Values in Argentine Shipyards First graph shows Total New building deliveries and attitude, MoMentuM gathered, and infrastructure in the others are shown the coMponents of State and institutions were created, laying the owned shipping coMpanies (ELMA, EFFEA, YPF), foundations for future developMent. Navy, and private and foreign clients. Only in 1966 did the then prevailing developMent This helps to understand the classification into minded intentions strengthen and result in suitable historical stages and the iMpact of the deMise of governMental policies for the times, which enabled the “Shipowning State,” which altogether a steady progress towards the second, Growth amounted to 45 percent of the total industrial stage of the activity. Following a worldwide trend, value. The MaxiMuM coMMissioned rate was promotion and protection scheMes resulted in a reached in the late 1970s, totalling over 400 MM great demand for ships froM governMental and US dollars annually. private ship owners, supported by aMple public The Groundwork phase starts with the first financing, siMilar to that in other countries, and significant Military shipbuilding project, in 1937, with subsidies to Match those received by foreign coMMissioned by the Navy froM national private shipyards in their atteMpt to enter the Argentine and public shipyards. On the basis of the Navy’s 2 market. It was a time of great development, which Using technical paraMeters, assessMent was made ended in the early 1980s. of the Value (in US dollars of today) and the Direct Due to external reasons, internal crises and (Adjusted Standard) Construction Man Hours (MH) changes in policies, the governMent stopped applicable to each unit, which in turn Made it buying ships in the country and suspended possible to classify inforMation under two criteria shipbuilding financing. Thus started the stage of (Value and EMployment) as applied to shipyards the Collapse of this industry, during which the and vessels so greatly different froM one another. largest private shipyards died out. What’s worse, as of the 1990s, a Most dubious policy proMoted 2.2.1. Value the tax-free iMport of second-hand ships, which FroM the analysis of the constructed value by becaMe the rule – and the Most lethal sectorial shipyard type, it was found that the state-owned policy – in the early years of the new century. Río Santiago shipyard (ARS, in Spanish) delivered This course Means that even to this date, the 40 % of the total value, although in the last decade sector reMains deeply sunk in undeserved it contributed only 15%. Underdevelopment – the naMe of the fourth The large private shipyards delivered 24%of the phase – froM which this paper atteMpts to provide total during their short lifespan and Middle-sized escape routes shipyards have grown the Most in relative contribution to the total value percentage, froM 2.2. Industry Study Criteria 36% of the total to 85% this last decade. As result of a Marine archaeology effort it was When coMbining this value contribution to the possible to identify the building data on thirteen generation of employment, it is concluded that, at hundred ships throughout the country since 1937 – present, the shipbuilding industry increasingly excluding sMaller (L<20M) and pleasure units. The depends on Middle-sized private yards. work resulted in the industry’s first ship production Fig.2 shows Value by type of ship or Market. database in Argentina (Podetti, 2018). Figure 2 – New buildings Values in Argentine Shipyards by Ship Type As regards the eMployMent criterion, each ship which is here defined as “Direct New building was assigned the standard direct production hours EmployMent.” adjusted by type of shipyard and construction “Total EMployment in Shipyards” was reached by period. This Made it possible to reach an estiMate coMbining sources (National EconoMic census, of the necessary aMount of productive staff Shipyards publications, etc.) and also includes needed for ships actually built at a given tiMe, production workers in excess of actual building 3 deMand (for instance, idle or working in ship has always been very sizable and requires large repairs), and indirect personnel. amounts of labour. ARS provided 41% of the total productive The ratio of Direct Jobs / MMUSD produced is of workforce in the whole period, but only 27% in the certain use to coMpare productivity as it shows the last decade (Fig.3). amount of people ¨required¨ to produce a certain Total EmployMent in shipyards is Much higher than value of ship. This ratio is 23,2 for the whole period Direct Construction EMployMent, for repair work and 14,5 for the last decade. 9.000 8.000 7.000 6.000 AFNE - AFNE - ARS 27% 5.000 ARS 41% RESTO RESTO 4.000 59% 73% 3.000 2006-16 2.000 1.000 - 37 42 47 52 57 62 67 72 77 82 87 92 97 2 7 12 17 Figure 3 - EmployMent in Argentine Shipbuilding Industry 2.3. Argentine Shipyards Originally, ARS played a Military role, soon Most of the shipyards in Argentina are privately diversifying its focus in order to Meet the needs of owned. Up to the 80´s there were three large the state owned Merchant Marine fleet. private yards (Astarsa, Principe and Alianza) and It built 73 significant vessels, standouts aMong nowadays there are 16 private Medium size yards. theM being the training tall ship ARA Libertad, The state owned yards are Astillero Río Santiago virtually all the nationally built navy fleet, YPF’s (ARS), Storni and the ship repairers Tandanor and largest oil tankers, and Merchant ships for ELMA. ANPB (Arsenal Naval de Puerto Belgrano). In the last years, construction was of bulk carriers and oil tankers, exclusively for export. Astillero Rio Santiago-ARS Traditionally, ARS was a Major eMployer in the The Río Santiago shipyard was founded in the 50´s, shipbuilding industry, representing 25% of total by president Perón as part of the State Shipyards historical eMployMent in shipyards, with a and Naval Factories (AFNE, in Spanish). Its concept, maximum record of eight thousand employees in design and ManageMent was undertaken by the 1970 and a MiniMuM of eleven hundred in 1992. Navy as part of the leadership exercised by the ReMarkably, over the last decade it represented naval force regarding the shipbuilding industry in 47% of total shipyards eMployMent, with soMe foundational and developMent tiMes. 3400 agents, despite its production being Much ARS was the industrial expression of a tiMe Marked reduced – providing only 15 percent of the period’s by the Soviet Model of overstaffed Mega-factories, total industrial value.