Maritime Hotspots Final report
M.W. Bloem MA
Nederland Maritiem Land series 1. De Nederlandse Maritieme Cluster: literatuuronderzoek en plan van aanpak economische impact studies 2. De Maritieme Arbeidsmarkt: vraag en aanbod van zeevaartkennis 3. De Nederlandse Scheepsbouw- en toeleveringsindustrie: economische betekenis en structuur 4. De Nederlandse Offshoresector: economische betekenis en structuur 5. De Nederlandse Binnenvaartsector: economische betekenis en structuur 6. De Nederlandse Waterbouwsector: economische betekenis en structuur 7. De Koninklijke Marine: economische betekenis en structuur 8. De Nederlandse Visserijsector: economische betekenis en structuur 9. De Nederlandse Watersportindustrie: economische betekenis en structuur 10. De Nederlandse Maritieme Dienstverlening: economische betekenis en structuur 11. De Nederlandse Maritieme Toeleveranciers: economische betekenis en structuur 12. De Nederlandse Zeehavensector: economische betekenis en structuur 13. De Nederlandse Maritieme Cluster: economische betekenis en structuur 14. Het Maritieme Clustermodel: modellering en scenarioanalyse 15. De Nederlandse Maritieme Cluster: beleidsaanbevelingen 16. De Innovativiteit van de Nederlandse Maritieme Cluster 17. Maritieme Websites en E- Business: een verkenning 18. Maritiem Kapitaalforum: onderzoek naar de werking van de kapitaalmarkt in de sector van maritieme toeleveranciers 19. An International Shipping Company in the Netherlands: the tax perspective 20. E-business in de Maritieme Cluster: visies, strategieën, activiteiten 21. De arbeidsmarkt in de Nederlandse Maritieme Cluster; een overzichtsstudie 22. Leader Firms in de Nederlandse Maritieme Cluster: theorie en praktijk 23. De Koninklijke Marine als maritieme leader firm 24. De Nederlandse maritieme cluster: monitor en dynamiek 25. European Maritime Clusters: Global trends, theoretical framework, the cases of Norway and the Netherlands, policy recommendations 26. a Voorschriften voor Commercial Cruising Vessels / 26. b Rules for Commercial Cruising Vessels 27. Monitor Maritieme Arbeidsmarkt 2003 28. Dutch Maritime Research, Development and Innovation Expenditure 29. European Maritime Policy Conference; Proceedings 30. Dynamic European Maritime Clusters 31. De Nederlandse Maritieme Cluster: Economische Monitor 2006 32. Monitor Maritieme Arbeidsmarkt 2006 33. Monitor Maritieme Arbeidsmarkt 2008 34. De Nederlandse Maritieme Cluster: Monitor 2010 35. De Marine en Marinebouw Cluster: Welvaartscreatie en Innovatief Vermogen 36. De Nederlandse Maritieme Cluster: Monitor 2011 37. Maritime Hotspots, final report, 2012
Stichting Nederland Maritiem Land The Foundation 'Nederland Maritiem Land' (Maritime by Holland) was established on June 27th, 1997 in order to promote and strengthen the Dutch Maritime Sector. The Board of the Foundation consists of A. Kraaijeveld (chairman), Mrs. T. Netelenbos (vice-chairman), R. Paul (secretary/treasurer) and further in alphabetical order, E.R. van den Adel, Mrs. M.H.C. Bakker-Mantjes, G.G.P.M. van Beers, Vadm. M.J.M. Borsboom, B. Buchner, K. Damen, E.M. van Dijk, J.J.C.M. van Dooremalen, S.J. van der Goot, G.L.M. Hamers, F. Heinis, Vadm b.d. J.W. Kelder, T.G. Muller, A.P.H. Vergroesen, A.A.N. Vink, F.D. Vroon. The director of the Foundation is A. Uytendaal.
Maritime Hotspots Final report
M.W. Bloem MA
Rotterdam, November 2012
Published and distributed by The Foundation 'Nederland Maritiem Land' (Maritime by Holland)
Study conducted by Bloem Doze Nienhuis Boompjes 40 / 3011 XB ROTTERDAM / the Netherlands T 0031-10-4007140 E [email protected] I www.bloemdozenienhuis.com
Design/Lay-out Sirene Ontwerpers Zeemansstraat 8 / 30000 ROTTERDAM / the Netherlands T 0031-10-4389282 E [email protected] I www.sirene-ontwerpers.nl
Print: Efficiënta Offset B.V. Burgemeester Aalberslaan 78 / 2922 BE KRIMPEN AAN DEN IJSSEL / the Netherlands T 0031-180 - 512522 E [email protected] I www.efficienta.nl
ISBN 978-90-820165-0-5 NUR 784
Copyright © December 2012 Stichting Nederland Maritiem Land All rights reserved. No part of the material protected by this copyright may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording or any information storage and retrieval system without written permission of the owner of this copyright. Permission may be obtained at the following address: Stichting Nederland Maritiem Land, Boompjes 40, 3011 XB Rotterdam, the Netherlands; e-mail: [email protected], website: www.maritimebyholland.com
Table of Contents
Table of Contents
Table of Contents I
List of figures III
List of Tables IV
Introduction 1
Summary 3
1. BIRD’S-EYE VIEW 1: Maritime Hotspot Saint Petersburg 7
1.1. Introduction 7
1.2. Ports and terminals 8
1.3. Shipping 12
1.4. Shipbuilding industries 14
1.5. Offshore Energy 19
1.6. Dredging 21
1.7. Inland navigation 22
1.8. Knowledge management 23
1.9. Company experiences 24
1.10. Conclusions and recommendations 26
2. BIRD’S-EYE VIEW 2: Maritime Hotspot Rio de Janeiro 29
2.1. Introduction 29
2.2. Ports and terminals 31
2.3. Shipping 32
2.4. Shipbuilding industries 33
2.5. Offshore Energy 36
2.6. Dredging 38
2.7. Inland navigation 39
2.8. Company experiences 40
2.9. Knowledge exchange 39
2.10. Conclusions and recommendations 41
3. BIRDSVIEW 3: Maritime Hotspot Singapore 45
3.1. Introduction 45
I Maritime Hotspots
3.2. Port and Terminals 47
3.3. Shipping 49
3.4. Shipbuilding industries 51
3.5. Offshore oil and gas 53
3.6. Dredging and port construction 55
3.7. Company experiences 56
3.8. Conclusions and recommendations 56
4. BIRDSVIEW 4: Maritime Hotspot Shanghai 59
4.1. Introduction 59
4.2. Ports and terminals 60
4.3. Shipping 62
4.4. Shipbuilding industries 64
4.5. Offshore energy 66
4.6. Dredging 68
4.7. Inland navigation 68
4.8. Yacht building 69
4.9. Knowledge exchange 71
4.10. Company experiences 71
4.11. Conclusions and recommendations 73
Bibliography 75
List of contacted persons 79
Participants Maritime Hotspot Seminar 81
II List of figures
List of figures
Figure 1.1: Total throughput at Russian ports and Port of St Petersburg (million tonnes) 9
Figure 1.2: Major shipbuilding clusters 16
Figure 1.3: Russian Inland Water Transport 23
Figure 1.4: Saint Petersburg Market opportunity assessment 26
Figure 2.1: Map of Brazil 30
Figure 2.2: Port movements 2011 31
Figure 2.3: Historical development of container throughput 2000 - 2011 32
Figure 2.4: Offshore coast Rio de Janeiro 37
Figure 2.5: Total crude oil production 2000 - 2020 (Million barrels per day) 37
Figure 2.6: Rio de Janeiro Market opportunity assessment 41
Figure 3.1: Singapore’s Economy 2011 46
Figure 3.2: Singapore’s total trade (million Singapore dollars) 46
Figure 3.3: Total Sea Cargo Handled (thousand tonnes) 48
Figure 3.4: Container throughput and sea passengers handled 48
Figure 3.5: Vessel arrivals (include all sea-going vessels & regional ferries above 75GT) 49
Figure 3.6: Location of yards in Singapore 51
Figure 3.7: Turnover and employment of the maritime industry, 2001-2011 55
Figure 3.8: Singapore Market opportunity assessment 57
Figure 4.1: Chinese ports 61
Figure 4.2: Volume of goods and containers handled at Shanghai Port 61
Figure 4.3: Deliveries super yachts build in China 70
Figure 4.4: Shanghai Market opportunity assessment 73
III Maritime Hotspots
List of Tables
Table 1.1: Fleet under Russian flag 12
Table 1.2: Fleet under Russian ownership 12
Table 1.3: Main Shipyards in St. Petersburg city 16
Table 1.4: Vessels currently under construction in the St. Petersburg city area 17
Table 2.1: Fleet under Brazilian flag 33
Table 2.2: Fleet under Brazilian ownership 33
Table 2.3: Orderbook and new orders 34
Table 2.4: Capacity Brazilian major shipyards 35
Table 3.1: Singapore flagged ships 50
Table 3.2: Singapore registered ships 50
Table 3.3: Singapore owned ships 50
Table 3.4: Shipbuilding capacity in Singapore 52
Table 3.5: Orderbook shipbuilders in Singapore region 53
Table 4.1: Chinese flagged ships 62
Table 4.2: Chinese owned ships 62
Table 4.3: Main shipbuilders in Shanghai region 64
Table 4.4: Orderbook shipbuilders in Shanghai region 65
Table 4.5: Freight Traffic by All Means of Transportation and the Growth Rates in 2011 69
Table 4.6: New orders super yachts mid-2012 in China 70
IV Introduction
Introduction
The sea connects all major economic regions in the world. This international context creates opportunities for all, but especially for those who have the skills and entrepreneurship to make the differences in business.
The Dutch maritime cluster1 is a vibrant ecosystem of 12.000 companies creating jobs for approximately 185.000 people, generating a value added of 34.5 billion euro and having a share of 5 per cent in total Dutch exports in 2011. Within a radius of 200 kilometres, eleven subsectors are active2 in the Netherlands. In spite of the crisis, the Dutch maritime cluster is a stable sector with strong growth perspectives. Probably the reason for this stability lies in the presence of some specific features of the Dutch maritime sector. The high level of technology, the drive to take full advantage of international co-operation supported by a strategic geographical location and a stable political and economic environment in the Netherlands.
The Dutch maritime cluster cannot exist without international business. It is of the utmost importance to maintain the excellent international relations which were built up during the past five centuries. With this in mind, a new project was launched by the Dutch Maritime Network, called ‘Maritime Hotspots’. Under this umbrella closer relations are to be developed between the Dutch maritime sector and other regions in the world that have a comparable density of maritime business.
For the purpose of this study, a Maritime Hotspot is defined as a geographical region that combines a major sea port function, with the presence of maritime world players in several sectors operating within a radius of 200 to 300 kilometres, and with an international influence on trade and technology.
The Dutch Maritime Network has developed the concept of Maritime Hotspots closely together with the Dutch Top Sector Water. Water is one of the nine economic priority areas of the Dutch government. The Top Sector Water contains three subsectors: maritime, water technology and delta technology.
Within the Top Sector Water, there are a number of teams that deal with a specific area of interest. The team ‘Export and Promotion’ is chaired by former Minister of Foreign Trade Mr Frank Heemskerk. It has developed an internationalisation strategy for the Top Sector Water and strongly supports the maritime hotspot project.
This project is definitively not a stand-alone initiative. Over the past ten years, great efforts have been made to promote the Dutch maritime cluster abroad. Four Holland
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1 See ‘Nederland Maritiem Land, De Nederlandse Maritieme Cluster Monitor 2011’, Rotterdam, April 2012 2 The eleven sectors are: ship-owners (seagoing, inland), shipyards, ports and terminals, water sports industry, offshore energy, dredging, navy, marine equipment, fisheries and maritime services.
1 Maritime Hotspots
Marine Houses (in China, Vietnam, Brazil and Russia) and a central representation in Singapore have been set up. Several specific subsidy programs (for example 2g@there) were successfully carried out, and the collective branding campaign ‘Maritime by Holland’ was developed. Besides that, full attention has been given to link export promotion with innovation projects. This way, export, product and technology development could be linked to each other. Annually, about 5 million euro was invested in maritime collective promotion and co-operation. Over the years it became apparent that promotion is only a small proportion of doing international business. A successful approach stands or falls with the build-up of structural, bilateral relationships. These relations cover all aspects of business: international technology development, exchange of people, fiscal issues, local investments, trade policies, economic diplomacy, export finance, et cetera. The mix of tools depends very much on the specifics of the geographical region.
Mid-2012 the Dutch Maritime Network has asked Bloem Doze Nienhuis to work out four possible Maritime Hotspots, and give basic descriptions of the markets in these regions. In this report the results are presented. The following Maritime Hotspots have been investigated: • Singapore – pivot point for maritime South East Asia • Rio de Janeiro / Santos – offshore hub and major port in fast developing Brazil • St. Petersburg- maritime capital of Russia • Shanghai – largest port in the world and home to Chinese maritime core businesses.
In a later stage, also other regions can be included, such as Houston (offshore engineering and services Gulf of Mexico), Pearl River Delta (ports, offshore, shipbuilding, inland shipping), Hamburg (finance, ship-owners, technology, ports), Istanbul (ports, shipyards, yachting, ship-owners), the United Arab Emirates or Perth (offshore oil and gas).
In this report the four maritime hotspots regions are described from a bird’s-eye view, including observations from Dutch companies that have business experience in these specific regions. The data for this report comes from interviews with Dutch major companies, from desk research by Bloem Doze Nienhuis and from the findings during the central conference on November 7th 2012.
We would like to thank the Ministry of Infrastructure and Environment, the Dutch Maritime Network, the maritime trade associations, and numerous Dutch companies for their great support in gathering all necessary information.
Rotterdam, November 2012
2 Summary
Summary
Market assessment In figure 1 a graphic is presented on the findings of this study. It shows on the one hand (Y-axis) the market opportunities per maritime hotspot. This represents the market expectations in the upcoming years. On the X-axis, the business environment is assessed. The ideal market should logically be found on the upper right side.
In terms of Market Opportunities, Rio de Janeiro has the highest scores. This is caused by the massive investments and spinoffs of the offshore oil and gas operations. These developments impact the offshore industries, ports and terminals, shipping, shipbuilding and dredging industries and create many business opportunities for service providers. However, the business environment is troublesome. This has to do with red tape, unfavourable taxes, local content demands, business culture plus language, and cost levels.
In terms of business environment, Singapore takes the lead. The stable and transparent governmental policies, incentive schemes, business culture, safety, fiscal regime and technology level are all of premium quality. The cost of living is relatively high, that should be taken for granted. In terms of Market Opportunities, mainly the offshore and dredging sectors score high. Inland shipping is non-existent.
Market assessment per maritime hotspot
Source: Analyzed by Bloem Doze Nienhuis
3 Maritime Hotspots
St Petersburg scores relatively low on business environment. The legal system is strictly based on Russian law, decision making processes are not always transparent, business culture does not always allow swift decision making, informal economies remain a problem and the cost of living is high. On the other hand, there are promising opportunities triggered by the WTO accession in 2012, arctic drilling operations and the reorganisation of the shipbuilding sector.
The maritime hotspot Shanghai also gives a diverse picture. The Business Environment in Shanghai is relatively good, although living is getting more and more expensive and local costs are rising. Fiscal systems are not always favourable to investors, decision- making processes are unclear and intellectual property rights are problematic. In the case of dredging, the market is completely closed to foreign companies. On the other hand, the infrastructure is good, maritime companies receive preferential treatment in Pudong, and trade is flourishing in this central Chinese region.
General recommendations 1. Strengthen local presence of the Dutch Maritime Sector in selected maritime hotspots. In every maritime hotspot there are formal structures (Consulates General, NBSO’s or regional representations), central business structures (Holland Marine Houses, bilateral Chambers of Commerce ) and individual rep offices. Integrate these organisations where possible in terms of housing, personnel, Holland branding. Create practical, integrated helpdesks for companies doing business in the area
2. Create a small central project organisation to support the maritime hotspots initiative, and organise Dutch business networks around the chosen hotspots. These business networks aim to monitor market developments, exchange information between Dutch companies, and give input to the Dutch Maritime Network. The networks must be entirely company driven. Once a year a Maritime Hotspots Conference can be organized in Rotterdam, hosted by the Dutch Maritime Network
3. Organise regularly trade missions under political or royal leadership. At least once every year a Dutch Minister or the Prime Minister should visit the hotspot, together with a Dutch maritime delegation. Timing as well as agenda to be prepared well in advance in a perfect public-private partnership. Give special emphasis to ship finance, development of large projects, non-tariff barriers and exchange of knowledge
4. Invite key clients from the maritime hotspots during the Maritime Week, every November
5. Co-operate more closely within the Top Sector Water, when doing business abroad. A closer co-operation and improved communication between Dutch water engineers, coastal construction, and shipbuilding industries, could benefit all.
4 Summary
Specific recommendations 1. St. Petersburg: make an unforgettable impression during the NLRF2013 presentation in September, using navy and political presence to the optimum. Create a helpdesk for maritime companies that have to deal with rules, procedures and regulations. Special focus on troubleshooting in the port of St Petersburg. Visualize and brand Dutch superiority in the fields of offshore engineering, shipbuilding processes, finance, inland navigation, dredging and logistics. Set up a human capital program. Give political priority to follow up of WTO accession
2. Rio de Janeiro: incorporate Santos and Sao Paolo in the hotspot activities program. Support Holland Marine House Brazil, and broaden its scope to a helpdesk that guides companies through the tedious procedures. Work together with the Dutch Consulate General. Maintain high level contacts with large companies such as Petrobras, Transpetro and Vale. Compare best practises of competitors in Brazil and create level playing field. Emphasis on mutual research, development and innovation. Organise permanent information exchange
3. Singapore: strengthen hands on diplomatic support for the maritime and offshore sector. Organise specific trade missions and their follow up. Maintain close contacts with Singapore’s Economic Development Board. Carefully explore possibilities of technology co-operation. Exchange Singapore personnel, PhD’s and students
4. Shanghai: Lobby for better investment conditions for Dutch companies and create excellent export finance facilities. Operate together as Dutch team when doing business. Constant attention for the problem of intellectual property infringements on all levels. Use current local structures and cluster activities with the Consulate General. Make better use of the contacts the City of Rotterdam maintains. Lobby for opening up the local dredging market to foreign companies.
5 Maritime Hotspots
6 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
1. BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
1.1. Introduction
The city of Saint Petersburg increasingly plays a role in Russian politics and in the maritime arena. Since the decision was taken to move the head office of Gazprom to this city, the political status of the city is rising. The maritime relevance of St. Petersburg lies in the Baltic Sea area, but stretches all over Russia as well. Traditionally, it is here where the maritime research institutions are based, where the major civil and military shipyards are, where the largest ports and terminals are located, and where maritime logistic operations are coordinated.
This birth place of President Vladimir Putin has strong ties with the Netherlands. The relations date back to the days of Tsar Peter the Great. In 2013, exactly these strong ties will be celebrated during the ‘Netherlands Russian Federation 2013’ festivities. The idea for this year of friendship developed during the visit of former President Medvedev to the Netherlands in June 2009. A broad range of activities in the fields of economy, culture and the society at large are scheduled. Around September 2013 special focus
7 Maritime Hotspots
will be given to maritime relations, including a visit of the Royal Netherlands Navy to St Petersburg.
The Dutch enjoy a good reputation in St. Petersburg, and opportunities are there in the field of cultural exchange. In this framework, it is even more interesting to highlight Maritime Hotspot St. Petersburg.
1.2. Ports and terminals
The main ports in the greater St Petersburg area are Vyborg Port, Primorsk Port, Ust-Luga Port and St Petersburg Port.
St Petersburg ports The current Port of St Petersburg is surrounded by the city and cannot expand. During winter time, the ports of Vyborg and Primorsk can only be reached by ice breaker clearways, frozen sea branches and channels. This is why a terminal was created in Ust-Luga for oil and containers. It is a deep water port that is relatively free of ice. The only problem is that it is 150 kilometres away from St Petersburg and the road connections are far from excellent. The port regions are stimulated by the government by creating special economic zones. In these zones attractive fiscal legislation and rulings exist for investors.
Growth During the first nine months of 2012 transloading in Russian sea ports reached a volume of 419.9 million tonnes, an increase of 5.2 per cent compared to the same period in 2011. In the Baltic Sea area the volume in cargo handling increased to 153.8 million tonnes (+11.2 per cent). Throughput at the Port of Primorsk was 57.3 million tonnes (+2.1 per cent), in Port Ust-Luga it doubled to 33.1 million tonnes and the Port of Vyborg 1.0 million tonnes (+36.4 per cent). At the same time, the amount of trans-shipment at the Port of St-Petersburg decreased with 3.5 per cent to 43.4 million tonnes.
8 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
Figure 1.1: Total throughput at Russian ports and Port of St Petersburg (million tonnes)
600 62 60 550 58 56 54 500 52 50 450 48 46 400 44 2007 2008 2009 2010 2011 2012* Port of St Petersburg All ports (L-axis)
Note: (*) forecast 2012 analysed by Bloem Doze Nienhuis / Source: Association of Russian Ports, Port of Saint Petersburg
According to Rosmorport3 (69 Russian ports working together in port management) by 2015 Russia will create the prerequisite for trans loading of 725 million tonnes including a 15 per cent reserve capacity. In 2020 this number should be increased to 879 million tonnes. Rosmorrechflot, the Federal Agency for Marine and River Transport, even aims for a throughput of 1.0 billion tonnes.
Factors in this growth are the rapidly developing middle class, Russia’s integration in the global economy as highlighted by the recent WTO membership, and Russia’s rich natural energy resources. The growth in volume is stimulated by the development of deep-water ports in Murmansk, Ust-Luga, and Kaliningrad.
This development makes the Russian seaports more attractive to international operators. It is the challenge for the Russians to allow hinterland connections to digest the further growth. In this framework, the creation of International Transport Corridors, North-South as well as East-West, are essential.
Rotterdam and Saint Petersburg The Port of Rotterdam has a MoU with Rosmorport and an office in St. Petersburg since seven years. According to the Port of Rotterdam4, Rotterdam is the most important port for the Russian export of raw materials. The volume transported through the Port of Rotterdam, especially in liquid cargo, has grown considerably in the past years. Russia’s share within Rotterdam’s total throughput in 2010 was 14 per cent or 59.8 million tonnes. This includes Russian crude oil and oil products exported via Poland and the Baltic Republics. In volume, Russia is Rotterdam’s 2nd largest partner, after the UK.
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3 ‘The development strategy of the sea port infrastructure in Russia to 2030’, Rosmorport 2012 4 Port of Rotterdam, press release August 22nd 2012
9 Maritime Hotspots
Oil terminal on Vysotsky Island, St. Petersburg
EU destination for Russian exports The Netherlands (Rotterdam) ranks 2nd after Germany. Its share was 13 per cent or 14.3 billion euro in 2009 (source: Eurostat 2009 and CBS 2010). The three main products are crude oil and oil products, both transported mainly via the Port of Primorsk, and containers transported via St. Petersburg.
Most of the freight heads westward. It consists of liquid bulk: 32.2 million tonnes of crude oil and 20 million tonnes of oil products, mainly fuel oil and gas oil (diesel). As such, Russia is the main oil supplier to the Netherlands. In Rotterdam, the Russian market share in crude oil is 30 per cent and in products it is 25 per cent. Other major freight flows are chemicals (approx. 950.000 tonnes), iron and steel (400.000 tonnes), non-ferrous metals (860.000 tonnes), and coal (450.000 tonnes).
The trade to Russia consists almost entirely of general freight: 2.3 million tonnes, mainly consumer goods in containers. From Russia, 2.6 million tonnes is exported in containers and in the form of break bulk. The number of containers transported in 2010 corresponds to 446.000 TEU, a 57 per cent increase compared to previous year. Container freight concerns both transhipment from Asia, and intra-European freight ('short sea'), concentrating on the Port of St. Petersburg, and since recently Ust-Luga. To date a large number of containers for/from Russia is still transported through Finland (224.000 TEU, +36 per cent compared to 2009).
The focus of the Port of Rotterdam with regards to Russia is break bulk (paper and wood products, steel and iron), containers and energy (oil, gas, coal, biomass). The oil sector in Russia will be mainly interested about the possibilities for tank storage, ship to ship transfers (dolphins and buoys in Caland Canal) and pipeline transport to the hinterland. The Dutch, on the other hand, are interested in the possibilities of the future energy port developments especially in Primorsk and Yamal/Murmansk.
10 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
Investments and trade relations In August 2012 Russia became a member of the WTO. The accession of Russia creates many new opportunities for Russia as well as for the Netherlands. The Hague based APM Terminals (part of A.P. Moller, Denmark) recently announced a strategic partnership with Global Ports in Russia5 worth 2.3 billion dollar. As a result of this multi-billion dollar transaction, APMT will become a partner in key container terminals in St. Petersburg, Russian Far East and the Baltic Sea area.
In October 2011 President Medvedev and Prime Minister Rutte signed an agreement with the SUMMA-group (including Dutch VTTI) for building a new terminal for crude oil and oil products in Rotterdam. This investment amounts to one billion dollar.
Meeting between President Medvedev and Prime Minister Rutte
The building of the terminal starts in 2013 and will be finished in 2015. Furthermore, it is the intention of both companies to develop more activities together. The Russian oil companies Lukoil and Rosneft have built up interests in refineries in Flushing and Gelsenkirchen, both of which are supplied with crude oil from the Port of Rotterdam. Lukoil also participates in a tank storage joint venture, STR, which is currently tripling its tank capacity in the Botlek area. Lukoil operates a Benelux headquarters and financial operational centre in the Rotterdam City area as well as other Russian companies such as the Summa Group.
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5 APM terminals, press release 10th September 2012
11 Maritime Hotspots
1.3. Shipping
Fleet under Russian flag At this moment, a total of 2.335 seagoing vessels are sailing under the Russian flag. The average age of these vessels is 28 years old. The average DWT tonnes and the average GT is relatively low, respectively almost 3.000 tonnes and 2.591 tonnes.
Table 1.1: Fleet under Russian flag
Average DWT Average GT Flag Country Vessels Average Age (tonnes) (tonnes)
Russia 2.335 28 2.923 2.591
Source: Clarkson
Fleet under Russian ownership The total Russian Fleet consist of 2.830 vessels. The average age of the fleet is 34 years. All the vessels together have a total DWT of almost three million tonnes, the total GT is 2.7 million tonnes.
Table 1.2: Fleet under Russian ownership
Owner Nationality Russia
Total Vessels 2.830
Average Age 34
Total DWT Tonnes 2.812.219
Total GT 2.750.934
12 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
River Neva partially frozen
The five main ship-owners in St. Petersburg measured by total GT are: • Volga-Neva Ltd (36 vessels): cargo vessels • Baltic Mercur Ltd (6 vessels): Multi persons vessels • Baltic Shipping Co. (7 vessels): Reefers and Ro-Ro vessels • Navigator LLC (12 vessels): product tankers • Orion Shipping Co. (19 vessels): cargo vessels.
When comparing these five main ship-owners in St. Petersburg to the total list of Russian ship-owners, it can be seen that the St. Petersburg commercial fleet is not that important (the highest ranked ship-owner from St. Petersburg in total GT is at place number 20).
Environmental impact Under pressure of Scandinavian, German, Polish cities and the Baltic States, St. Petersburg is forced to reduce greenhouse gas emissions in the Baltic. Several new international agreements are increasing this pressure. The port association between - among others - Rotterdam, Antwerp and Hamburg, promotes the development of the Environmental Ship Index. Further pressure is introduced by the coming into force of the Sulphur Emission Control Area. In 2015, the highest sulphur content allowed in ship fuel in the Baltic Sea will decrease to 0.1 per cent (MARPOL 73/78 Convention,
13 Maritime Hotspots
Annex IV). In the Baltic Port Barometer6, respondents were asked to evaluate how this change will affect their own port. Most respondents believe that there will be a decrease either in total cargo volumes or in specific cargo types in their port. Most often mentioned cargo type to experience decline in volumes is Ro-Ro. In addition to changes in cargo volumes, 16 per cent expect that the vessel size of the ships visiting their port will grow. Nevertheless, one third foresees no changes due to the switch to low sulphur fuels by 2015.
It is clear that the environmental restraints will grow and have an increasing impact on the operations in the sensitive Baltic Sea area.
1.4. Shipbuilding industries
Russia has the ambition to catch up with major shipbuilders around the world. The reality is however, that the shipyards in the Russian Federation face many problems. The production facilities and machinery in the shipyards are outdated. There is a shortage of knowhow in technical logistics, construction technology, and modern marketing and positioning tools. Several problems occur in the supply chain management, ranging from timely deliveries, production planning, contracting and budgeting.
This combination of outdated facilities and suboptimal production processes have led to ship construction that exceed two times the normal lead time. Young talents have left the industry, because of low payment and insecurity. Project finance is problematic, and large yards are not existing (at this moment maximum 100.000 DWT).
This worrisome picture has urged the Russians to take action. The government has declared shipbuilding a primary sector, which means that there is a new willingness to invest. According to the Ministry of Industry and Trade, the government will allocate 15.04 billion euro to the program of development of civil shipbuilding by 20307. The program has been already approved.
Regarding to a document, 8,4 billion euro should be allocated directly from 15.04 billion euro. In 2013-2015 it will be spend 1.29 billion euro of public funds for the development of civil shipbuilding; in 2016-2020 – 2.86 billion euro; in the years 2021-2025 – 2.9 billion euro; in 2026-2030 - 1.34 billion. The civil part of the program consists of five sub-programs. It will be allocated 1.08 billion euro to the government support. The most expense item is the Science and Technology program which requires 3.06 billion euro. Also the government will allocate 0.13 billion euro to system-analytical support of government program.
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6 Baltic Port Barometer 2010, Centre for Maritime Studies, University of Turku, September 2010 7 http://lenta.ru/news/2012/11/09/ships/
14 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
On Thursday, November 9 2012, Dmitry Medvedev said that output of the civil vessels is expected to grow by five times by 2030. According to him, more attention will be given to the creation of scientific fleet, as well as platforms for offshore operations. Although the influence of South Korean yards is increasing, mainly through Finland based STX, the Netherlands should be able to play a role in improving the quality of Russian shipbuilding.
United Shipbuilding Corporation In March 2007, the United Shipbuilding Corporation (USC) was established. The USC is a conglomerate of shipyards and related industries. It was established for several reasons, the most important being: • the transformation from military to civil shipbuilding • reorganization of the existing shipyards in Russia and • the creation of new production and engineering capacity.
The USC is an open joint stock company from Saint Petersburg. It is fully state-owned. The share capital of USC is formed by transferring monetary assets and shares of several shipbuilding entities to the central company. USC is operated from three regional departments: • OJSC West Shipbuilding Centre in St. Petersburg • OJSC North Shipbuilding and repair Centre in Severodvinsk, and • OJSC Far East Shipbuilding and repair Centre in Vladivostok.
The USC includes several military shipyards, thus also serving the strategic purpose of maintaining a strong defence industry. The largest military shipyard is located near Archangelsk, 500 kilometre Northeast of St. Petersburg in the town of Severodvinsk (White Sea). Two other shipyards, Sevmash and Svezdochka, are the largest naval shipyards in Russia. Nuclear submarines are both built and serviced at the two shipyards. Both shipyards are subject to the Ministry of Economy. Sevmash is the only shipyard in Russia engaged in the construction, servicing and dismantling of nuclear submarines for the Russian Navy. Increasingly the shipyard is involved in offshore constructions for arctic operations.
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Figure 1.2: Major shipbuilding clusters
Source: INTSOK, innovation Norway
The main shipbuilders in the St. Petersburg city area are as follows.
Table 1.3: Main Shipyards in St. Petersburg city
First Yard DWT Number of Number of Number of Builder Name delivery maximum Specialty vessels Orderbook dry docks berths year (tonnes) delivered
Cargo and Nevsky S.B. 1912 7.000 0 10 tugs Product Admiralty and 1959 2 2 70.530 31 1 Shipyard chemical tankers Ro-ro, Baltic 1992 1 48.640 chemical, 15 2 Shipyard PSV Shipyard 2003 400 Tug 41 2 Pella
Source: Clarksons
The Admiralty Shipyard obviously is the largest. It has 4.500 employees. Together with the French, this yard builds the Mistral class navy vessels. It has been a deal that was strongly pushed by French politics leaving other competitors behind. In December 20118, the St. Petersburg Government approved the construction of shipbuilding centre on Kotlin Island. The New Admiralty Shipyard will be able to build ships up to 200.000 DWT. The layout and production technology is developed together with South Korean / Finnish STX which holds a 25 per cent share in the new yard.
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8 Shipbuilding tribune.com, 15/12/2011
16 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
According to the Clarksons database, currently 15 vessels are under construction in the St. Petersburg city area.
Table 1.4: Vessels currently under construction in the St. Petersburg city area
Total Average Average Builder Builder Yard Total GT Total CGT Vessels DWT DWT GT Name Location (tonnes) (tonnes) (tonnes) (tonnes) (tonnes)
Nevsky S.B. Schlusselburg 10 58.430 44.340 61.726 5.843 4.434
Admiralty St. Petersburg 1 12.000 12.711 16.119 12.000 12.711 S.Y. Baltic St. Petersburg 2 10.800 8.364 16.183 5.400 4.182 Shipyd. Shipyard St. Petersburg 2 504 376 2.365 252 188 Pella Source: Clarksons
The vessels currently under construction are cargo vessels, platform supply vessels and tugs. In total 43 companies are active in St. Petersburg shipbuilding industry. Two companies are fully state owned, 39 partly state owned and two companies are privately owned. This again illustrates the influence of the Russian government. Nine institutes are involved in research and design, which is relatively a high share. It can probably be seen as an heritage of the rich tradition in shipbuilding knowledge of the region.
Shipbuilding legislation According to a recent Finnish report9 the bill “On the Support of Russian Shipbuilding and Navigation” aims to: • Bringing the prices of vessels built by Russian shipyards for Russian clients down by 20 per cent as compared to South Korean prices. This will be made possible by the cancellation of duties paid on imported ship equipment and considerable tax privileges for shipbuilders provided for in the bill, as well as measures directed towards the creation of shipbuilding clusters • According to the bill, special economic zones must be created and stay in place for the following twenty years. The residents of such zones will be Russian shipbuilders. Those residents will enjoy both the existing and newly established customs and tax preferences. For instance, in the way of investment tax credit, they should be relieved of VAT, land, water, property and transportation tax payments, also from VAT on equipment imported with the purpose of modernizing their production lines and building ships, their depreciation charges will be calculated non-linearly and profit tax they pay will not exceed 6 per cent.
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9 Finpro, North West Russia Sea Cluster Business Map, St Petersburg 2011
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All measures must serve as incentives for domestic shipping lines to order their vessels from domestic manufacturers. However, the bill does not resolve the problem of shipping finance. The shipbuilding loan programs are unprofitable. Russia has the highest APR rates, 12 per cent to 14 per cent for four to five years. Furthermore, leasing programs are as good as non-existent. In 2008, a nine billion dollar leasing program was launched under the auspices of the United Shipbuilding Corporation. However, just one contract was completed under it between the Volzhsky shipping lines and the Oka shipbuilding yards for ten dry bulk carriers together worth 4.72 billion rubble.If the finance problem is resolved this bill may work. Relieved of taxes, companies will grow. However, if the financing problem is not resolved Russia fears that foreign owners will conquer the domestic waterways as soon as they are made accessible to foreign vessels.
Future requirements According to a recent thesis from Erasmus University10, home demand for construction of new ships is constantly growing. This is reflected in the federal target program “Development of transport system of Russia 2010-2015”. The subprogram “Inland Navigation Transport” stipulates the construction of 352 service vessels by 2015 and replenishment of inland navigation transport fleet by 110 vessels. Another subprogram “Maritime Transport” sets the benchmark for replenishment of transport fleet at almost 7 million deadweight tonnes and construction of 65 supply vessels by 2015 (Ministry of Economic Development of the Russian Federation, 2009). The report gives two main reasons for this increased demand: (1) the government driven development of inland waterways navigability, which will drive the demand for river vessels, and (2) the aging structure of the Russian fleet specifically in the segment of inland navigation and fishing.
In potential, the Russian renewal of the inland fleet could create opportunities for Dutch Shipyards and marine equipment suppliers. However, the Russian River Register demands certificates and procedures are long. Russian shipping companies are forced to buy their ships in Russia, also under the pressure of the Russian River Register. Diplomatic and political talks should stress the importance of opening up the market. It will increase innovation, sustainability and economic development of the Russian transport economy.
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10 Artiom Marinov, Analysis of the Russian shipbuilding Market Competitiveness, Erasmus University 2012
18 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
1.5. Offshore Energy
Sakhalin II
Over one third of the Russian federal government budget is generated directly or indirectly by the oil and gas sector. This is why the oil and gas sector in Russia is highly influenced by the authorities from Moscow. The following (semi) government organizations are main players in this sector. • Gazprom - natural gas state monopoly. It is the world's largest gas exploration and production company • Lukoil - Russia's largest oil company and its largest producer of oil • Rosneft - the 75 per cent state-owned Russian oil and gas exploration company
At present, Russia’s onshore production areas are in the North Caucasus, in the Ural-Volga Region and in Western Siberia. The onshore reserves are however rapidly shrinking. Therefore, the offshore production of oil and gas is stimulated. At this moment offshore accounts for only 3 per cent of the total Russian production. Large offshore projects are in Russian’s Far East (Sakhalin 1, 2 and 3), and in the North Western part of Russia (Shtokman). Also on the shelf of Russia’s Black, Caspian and Azov seas operations are developed. Being a strategic activity, central decisions on the oil and gas sector are made in Moscow. In this sense, Saint Petersburg is not the most important decision-making centre. However, the city does play a role when it comes down to offshore engineering solutions and the export of oil and gas.
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Challenges for offshore projects The Russian oil and gas sector faces a major difficulty. The offshore oil and gas investments within the most promising regions, are technologically challenging and very expensive. The areas in the Far East and the North are hard to access and have extreme conditions in winter time. For a sound development, the help of Western companies is inevitable. However, foreign investment in such projects is restricted by Russian law. In 2010, the Ministry of Natural Resources suggested the liberalization of foreign companies’ access to Russian offshore operations up to a 50per cent share. Furthermore, the technical state of the Russian fleet is not up to standard. As an example, the environmental protection fleet that is needed in case of emergencies is under developed. Exploration of reserves is not optimized. But the Shtokman project shows that the Russians are indeed slowly opening up to western technology. Dutch SBM Offshore is one of the companies supplying equipment here.
New opportunities will emerge in the North Middle and East arctic regions. So far drilling activity in this region is minimal. The conditions in these regions are however even more harsh than in Arctic West region; technology challenges and costs are substantial because the region is only accessible by water in summer.
20 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
1.6. Dredging and port construction
Coastal construction Boskalis in St. Petersburg, the storm surge barrier
Dutch dredging companies have been very active in Russia over the past decades. Van Oord has installed pipeline connections to the mainland and pipeline trenching and stone dumping operations in Sakhalin (Far East). In 2012, Van Oord installed the Arcutun Dachi platform near Sakhalin. In the St Petersburg area, Van Oord had an important contribution in the realisation of the new cruise terminal. They developed land for the new investments on Vasilyevski Island. In the Northern region of Russia, Van Oord was active in the Barents Sea and, since 2008, in the Kara Sea for the development of Yamal (Baydaratskaya Bay). The projects in Yamal are characterized by very harsh winter conditions, where it is only possible to execute dredging operations during 3 month per year due to ice conditions. In 2012, Van Oord executed projects in Baydaratskaya Bay for the 5th consecutive season. The Company was also involved in the construction of the Nordstream pipeline.
From 2006 to 2011, Boskalis had major orders in the St. Petersburg region. The Russian Ministry of Regional Development awarded contracts for the completion of the flood protection barrier and related works such as dredging a navigation channel and the realisation of a construction pit for a tunnel under the shipping passage. At the peak of these operations, sixteen different vessels were active. The projects will have a large impact on the liveability (flood control) and economic development (access channel, ring road completion) of the city.
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Another recent example of Boskalis is the Nordstream project, which connects the Russian Gas infrastructure to Northern Germany by pipeline. Dredging operations and port construction in the inland waters are performed by local contractors. Dutch contractors are dependent on local infrastructure and tug operators, which complicates the local works. It is not possible to bring along own tugs. Ships have to be imported temporarily, and need a flag waiver. New WTO-rules have not changed this practice so far.
1.7. Inland navigation
Russia has over 100.000 kilometres navigable inland waterways infrastructure. Navigation is most intensive on the Unified Deep Water System with a guaranteed depth of 3.6 meters. It is a complex of rivers and canals in European Russia. It can accommodate sea-river vessels up to 5.000 DWT. Nowadays however, less than 4 per cent of the goods in Russia are shipped through inland waterways. Over the following ten years, at least 8.000 inland ships craft of a total of 9.500 must be decommissioned or discarded. If such a loss is to be compensated, about 800 vessels must be launched annually. At this moment, no more than 30 are built every year. Vladimir Putin had demanded that in the way of preparing Russia for joining the WTO in august 2012, the possibility was considered of admitting foreign carriers to the country’s domestic waterways. If this measure comes into force it would mean a landslide change in Russian policy.
Saint Petersburg inland corridor Saint Petersburg is an important link in the Russian Inland Water Transport. From the city of St Petersburg, the cities of Moscow and Nizhny Novgorod can be reached. The rivers stretch all the way to the Azov sea / Black Sea.
22 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
Figure 1.3: Russian Inland Water Transport
Source: Marin.ru
One of the positive aspects of the entry of Russia into the WTO should be an increase in investment attractiveness and freight traffic. It should lead to a reduction or abolition of duties, quotas and other restrictions.
So far, the aging of the inland fleet is problematic. Due to financial scarcity and bureaucratic hindrances, there does not seem to be a quick solution. The increasing activity in the deep sea port, however, can further stimulate inland navigation development including allowing foreign registered ships to enter Russian waters.
1.8. Knowledge exchange
St Petersburg is a sister city of the City of Rotterdam. The Port of Rotterdam has its own local representative, and there are initiatives from HME (Holland Marine House) and from the three Northern provinces (Nord Connect House). In St. Petersburg, the city university and the Krylov institute play a role in the management of know how. There are contacts between Dutch and Russian universities and institutions, but as far as we know, no large research programs are conducted. Exchange of know how in the field of LNG technology, arctic operations, coastal construction, and shipbuilding process technology could be further developed. Also a further increase of exchange students is desirable.
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1.9. Company experiences
Large projects In the eyes of Dutch oil and gas companies, the decision making processes in Russian offshore projects are slower than usual and the flexibility is comparatively low. The Russians have the tendency to regulate every detail beforehand. Even that is impossible for the most complex and unforeseeable projects like exploration and production in arctic regions. Contracts are in Russian law. English law or continental law are not accepted. Given the risks and size of offshore related contracts, this makes Western companies reluctant to enter the market.
Although the procurement policy of the major Russian oil and gas companies is not always transparent, Russia is certainly not closed to Western equipment. Large quantities of foreign equipment are already imported and there is no strictly maintained legislation on national content. Compared to some other maritime hotspots, this is probably a more favourable situation for Dutch hardware suppliers.
Dutch dredging companies are often involved second tier in large projects. Main contractors like MRTS are in between. Sometimes special purpose companies are erected by the client, in order to make business possible. It is almost impossible to be directly involved, due to the complex paperwork and local requirements.
Personal relations The key to doing business in the Russian oil and gas sector is to have personal relations. Trust is the key: once they are convinced that you can do the job, you are number one. Political relations matter, active central promotion works. Status counts, show that you are the best. High level political missions work.
Companies that successfully hire a good team of local people, can be quite successful. They can handle the complexity of Russia and let it work in your advantage. The example of the Kursk project shows us that it is important to do your homework well. In that respect, a good information network within the Netherlands can help.
The practice of investing In practice, the successes of mergers take overs or joint operations are highly dependent on the reliability of local partners. In case of taking over a company, you are confronted with unforeseen overhead costs. Many semi government people are on the payroll, although this is slowly getting better.
24 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
If investments are planned, it must be calculated that the taxes are not always clear. There are practical examples of companies hearing afterwards if they have a tax waiver. Besides this problem, the safety mentality at the terminals is not up to Western standard. Licenses, taxes, and the mix with private interests make business hard in Russia.
Shipping experiences Dutch ship-owners regularly call on the Port of St. Petersburg. Most ship-owners that regularly call this port have their own agents and have created their own office. One of the reasons is to attract Russian crew.
Procedures are complicated and idle time of vessels waiting for commission inspection is relatively high. This is a result of complicated procedures when ships cross the state border of Russia. Special visa are needed to visit the port area (and your ship). That is why most ship- owners do not repair there. Communication is in Cyrillic Russian, even the simplest procedures. The Russian officials want to be in control. If a crew member does not fully comply, he or she can be forbidden to enter the port in the future.
The so-called ‘Apostille procedure’ is very complicated. This makes business uneasy. On the other hand, bunkers are relatively cheap. The problem is that the Russian inland waterways are closed for foreign owners. If that would be opened, it should give a boost to the trade through St Petersburg including passage to the Wolga.
According to several respondents, the Russian inland waterways are closed for foreign owners. If that problem were solved, there would be a boost to the trade through St Petersburg including passage to the Wolga.
Best Practices: Norway and Finland Companies doing business in St Petersburg will encounter serious competition from Norway and Finland. Both countries actively support their companies in doing business with Russia. Norway has an active approach through its initiative ‘Innovation Norway’. Innovation Norway has an office in St. Petersburg. In fact it is the commercial department of the Norwegian Consulate General. Together with the Norwegian Russian Chamber of Commerce (NRCC), many activities are deployed. One of its specific interests is Maritime. It is a mix of export promotion and innovation stimulation activities.
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1.10. Conclusions and recommendations
The next graph shows our assessment of market opportunities. On a 1-to-10-scale we have attributed a score per sector. The shipbuilding, offshore energy and inland navigation in Saint Petersburg weigh heavily on the average.
Figure 1.4: Saint Petersburg Market opportunity assessment Saint Petersburg
10 9 8 7 6 5 4 3 2 Average 1 0 MarketOpportunity
Source: Analysed by Bloem Doze Nienhuis
The offshore sector scores relatively low, because decision making on large offshore projects takes place in Moscow. Market opportunities in offshore for Russia as a whole are obviously much higher. The influence of St Petersburg is however rising.
26 BIRD’S-EYE VIEW Maritime Hotspot Saint Petersburg
Recommendations are:
1. Set up a central contact point in St Petersburg. Tasks include central representation of the Dutch maritime industries, practical trouble shooting in the port of St. Petersburg, and identification of commercial opportunities. Set up in close co- operation with the Consulate General and the Holland Marine House Russia
2. Use the ‘Netherlands-Russian Co-operation Year’ in 2013 to promote the Dutch Maritime Cluster in Saint Petersburg. New ambitions are certainly there; investments in port infrastructure, shipbuilding and shipping are underway. The decision making centre for offshore operations lies in Moscow, however technical decisions in the marine field are made in St. Petersburg
3. Make concrete offers for partnerships to the Russian authorities, including credit facilities offered by Dutch financial institutions and Dutch coverage in combination with Russian finance. Level the playing field towards Belgian, Scandinavian and East Asian competition
4. Visualize the Dutch superiority in special offshore operations, shipbuilding processes, finance, inland navigation, dredging and water construction, logistic operations. Exchange knowhow within The Netherlands, for example with engineering companies like Witteveen en Bos, Royal Haskoning and Arcadis
5. Set up a human capital development programs, including the exchange of personnel and students. Share knowledge and offer of the shelve education programs
6. Transparency issues calls for intensive collaboration and exchange of experiences between Dutch companies. Stimulate the internal interaction between Dutch maritime players by organizing Russian Maritime Business Club meetings
7. Stress the importance of free trade and less bureaucracy in diplomatic channels. Study the implications of WTO-accession for the Russian waters, and lobby for better access of Dutch ship-owners to Russian waters.
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28 BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
2. BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
2.1. Introduction
The Southern region of Brazil is economically the main engine of the country. The region ranges from Rio Grande do Sul in the far South to the state of Espirito Santo just above Rio de Janeiro. In between are the major cities of Sao Paolo, with the port of Santos, and the city state of Rio de Janeiro. The offshore oil and gas sector is responsible for the growing economy and strong increase in foreign and national investments. The development of the offshore industry is directed by state-owned Petrobras.
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Figure 2.1: Map of Brazil
Source: Ministry of Transport Brazil
Maritime hotspot Rio de Janeiro covers the area Rio de Janeiro-Santos. In this coastal area the main oil fields are located as well as the main port of Santos, the majority of shipyards, and the headquarters of multinationals such as Petrobras, Transpetro and Vale11. This however does not imply that all maritime activities come from this particular area. Several Dutch companies that were interviewed for this research see an increasing decentralisation of activities to other parts of the country. After Sao Paolo/Santos and Rio de Janeiro, they mention Recife, the Amazone mouth and Porto Allegre as fast developing economic regions.
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11 Vale, or Companhia Vale do Rio Doce, is a Brazilian multinational metals and mining corporation and one of the largest logistics operators in Brazil. It is the second-largest mining company in the world.
30 BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
2.2. Ports and terminals
In Brazil, 34 public ports are active and 129 port terminals are in private use (figures 2011, Antaq). Most handled goods in the ports are iron ore, liquid bulk and soya. Total volume of handled goods in 2011 was 886 million tonnes. A mere 4 per cent or 31 million tonnes consists of inland transhipments.
Figure 2.2: Port movements 2011
Source of data: Antaq 2011
The Brazilian government actively promotes investments in new ports and terminals. Only in the South West (Santos, Rio de Janeiro, Itaguai and Vitória) leasing concessions worth 2.2 billion dollar are being sold. They vary from iron ore, to sugar, containers, materials, cars and industrial supply purposes. Environmental rules are however taken very seriously under the Development and Zoning Plan. Government agency Antaq12 indicates however, that the investments are primarily carried out within areas defined by presidential decree. Heavy environmental studies should be done before licenses are given on port infrastructure. This process is very time consuming and could bring along uncertainties for the investor.
Brazil has witnessed an impressive growth of its containerization. The next graph shows this development. Between 2000 and 2011 the volume in container throughput quadrupled to almost eight million TEU in 2011.
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12 National Agency for Waterway Transportation – ANTAQ, Waterway Panorama, October 2009. Antaq is responsible for the regulation supervision of Port Authorities and the Waterway infrastructure, and authorizes supervision of private terminals and shipping companies.
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Figure 2.3: Historical development of container throughput 2000 - 2011
6,00 09 08 5,00 07 4,00 06 05 3,00 04 2,00 03 miliion units million TEUs 02 1,00 01 ,00 00 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Number of containers Volume (R-axis)
Source: Antaq
In 2010, the Port of Rotterdam was asked by the Brazilian government to review a study into remodelling the Brazilian public port sector. At the beginning of this year, the Rotterdam Port opened a new office in São Paulo. It will work intensively on the further development of Porto Central13. It is a new port in the extreme south of Espirito Santo state, just to the north of Rio de Janeiro State. It will be an industrial port on deep sea water for handling oil, gas, offshore services, dry bulk and general cargo. The Port Authority’s main contribution will be its expertise and knowledge in the field of port management. This cooperation agreement will be converted into a joint venture once conditions have been met. On September 22nd 2012 the Port of Rotterdam presented their plans on the new port development to Antaq officials in Brasilia. Total investments are estimated at 4.8 billion Reaal (1.8 billion euro). The start of the construction of the new port is aimed at 2015. Several other Dutch based parties (Huisman, APMT and in some respects the Port of Amsterdam) have experience with planning investments. The port of Amsterdam is assisting the Brazilians in the development of transport corridors. They see important developments in the South (Rio Grande do Sul).
2.3. Shipping
The coast of Brazil stretches over 8,000 kilometres. Along this coastline the major cities and ports are located. Therefore, it is not surprising that coastal shipping grows at a pace of 20 per cent per year. There are four short sea companies in Brazil: Mercosul Line (Maersk group), Alliance (Hamburg-Süd group), Log-In and Maestra.
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13 Port of Rotterdam, Press Release April 2012
32 BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
These companies operate six dedicated ships for short sea shipping, and operate feeder services with smaller vessels used in large ports for transhipment. However, the participation of short sea shipping is low in terms of total transportation of cargo. Feeder services are often more attractive as short sea shipping needs proper integration between the points of loading and unloading, as well as intermediate points for distribution.
In a recent report14 the following impediments are being described for the further development of short sea shipping in Brazil: • Lack of government policy to develop the Brazilian waterway system • Long distances from ports connecting to production centres • Less flexibility with short sea shipping, slower transport and saturated port infrastructure • Access restrictions from the sea (depth) and land (road and rail).
Table 2.1: Fleet under Brazilian flag
Average DWT Average GT Flag Country Vessels Average Age (tonnes) (tonnes) Brazil 614 21 6.953 3.908
Source: Clarksons
Table 2.2: Fleet under Brazilian ownership
Owner Nationality Brazil Total Vessels 637 Average Age 18 Total DWT (tonnes) 19.584.126 Total GT (tonnes) 10.907.407
Source: Clarksons
Under the umbrella of Petrobras, Transpetro plays a vital role in oil and gas logistics. The Promef (Programa de Modernicao e Expansao da Frota da Transpetro) program creates a new fleet of tankers and offshore support vessels for the company. In 2010, the 52 Transpetro vessels had the capacity of transporting 2.9 million tonnes of products.
2.4. Shipbuilding industries
In the late seventies of the last century, the Brazilian shipbuilding ranked among the largest in the world. In 1979 there were 39.000 workers active in the shipyards. The industry was however almost completely destroyed in the crisis years that followed. In
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14 IAME 2011 Conference, Santiago de Chile, October 2011: De Valois et al ‘Short sea shipping in Brazil’
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2000 the workforce was reduced to 1.900 workers. Since that period however, the path of recovery was found, mainly driven by the development of national offshore operations.
Table 2.3: Orderbook and new orders Ship type Order book New Orders Offshore Support Vessels 22 89 Tankers / Products / Bunker 55 21 FPSO / Semi-Subs / TLWP 16 - Box 3 4 Bulk 1 2 River Barges and Tugs 37 72 Drill ships 7 21 Chemical 4 5 Gas 8 - Port Tugs 5 27 Total 158 241
Source: SINAVAL – Brazilian Shipyards Overview – January 2012
According to trade association SINAVAL15, nowadays 59.000 people find employment in shipbuilding and it is expected that this number will rise to 81.300 in 2013. The largest workforce (43 per cent) can be found in the shipyards of Rio de Janeiro.
The latest orderbooks of Brazilian shipbuilding companies consists mainly of tankers (55), river barges and tugs (37), offshore support vessels, and large offshore vessels (16). The main shipyards in Rio de Janeiro are Eisa, BrasFELS, Mauá, STX OSV, Alianca and UTC.
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15 SINAVAL, Offshore and Shipbuilding Industries Overview, January 2012
34 BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
Table 2.4: Capacity Brazilian major shipyards
Main Steel shipyards process. production State 1.000 m² Dry dock Slipway Dock 1.000 t. capacity year Yard
Eisa RJ 52 150 0 2 3
BrasFELS RJ 50 410 1 3 2
Mauá RJ 36 334 1 1 4
STX OSV RJ 15 120 1 1 1 Niterói
Aliança RJ 10 61 0 1 2
UTC RJ ND 112 0 0 2
Wilson, Sons SP 10 22 1 1 1
Navship SC 15 175 0 1 2
Rio Grande RS 30 100 1 1 1
Quip RS 0 70 0 0 1
Atlântico Sul PE 160 1.500 1 2 2
Source: SINAVAL – Brazilian Shipyards Overview – January 2012
The Merchant Marine Fund plays an important role in ship finance, disbursing 840 million dollar (2011) in 90 per cent loans. This represents an annual contract value of 930 million dollar.
With an order for 49 oil tankers, Petrobras daughter Transpetro (Promef program) provides investments of the scale required to modernize the national fleet and set up three new shipyards in Brazil: the Atlântico Sul and STX-Promar shipyards in the state of Pernambuco and the Rio Tietê Shipyard in São Paulo. These new installations will build waterway convoys to transport ethanol.
A Norwegian report16 describes that the shipyards are now facing a new reality and a double challenge for the years to come: 1. To build platforms and support vessels for Petrobras and at least 42 big ships for Transpetro. The impressive home demand generates a great pressure on human resources and on the equipment supply chain at competitive prices 2. To take in new orders from private shipping companies, in order to maintain and increase investments in the new shipyards. This puts pressure on their competitiveness and forces the shipyards to invest in efficient shipbuilding methods and production equipment. Also human capital plays an important role.
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16 INTSOK, Shipyards in Brazil, June 2010
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3. Accompanying problems are the price level and quality of local supplies, which the shipyards are forced to use because of national content demands. The fact that there are problems was recently highlighted in the news. In May 2012, Transpetro confirmed that it has suspended the execution of the contracts for 22 oil tankers ordered from the Atlântico Sul Shipyard (EAS) under Promef. Shortly after this incident, Transpetro decided to fine the Atlântico Sul Shipyard (EAS) for the delay in the delivery of another oil tanker.
Meanwhile Dutch shipbuilding and supply conglomerates are progressing their local presence in the Brazilian market. Damen Shipyards has already years of experience in Brazilian partnerships, and on short notice IHC Merwede will establish their local office. Huisman has recently started their land fill works for a new production facility in the Southern province of Santa Catarina ( Navegantes). The Netherlands can investigate the possibility of helping the shipyards optimise their processes, train the personnel, stimulate joint industry projects and supply ships- and production equipment.
2.5. Offshore Energy
The Agencia Nacional do Petróleo, Gás Natural e Biocombustívies (National Agency of Petroleum ANP, linked to the Ministry of Mines and Energy) is responsible for the regulation of the oil sector. Brazilian politics increasingly realize its special moment in the oil and gas sector. Governments intend to boost its development by taking full advantage of the oil and gas revenues. It is a political decision to help the development of the Brazilian offshore industry. This is done by strict regulation of national content demands. Foreign investments are welcome, but any foreign company or research institution will have to obey the rules.
36 BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
Figure 2.4: Offshore coast Rio de Janeiro
Source: EIA
National oil company Petrobras is responsible for the development of new oil and gas fields. The basins of Santos and Campos contain very large reserves. The reserves are positioned in deep water, and the oil is hidden under layers of salt (pre-salt). This combination makes the exploration and production challenging. Petrobras is developing the fields by large-scale production through floating production, storage, and offloading (FPSO) units. Petrobas currently produces 100.000 barrels per day from these pre-salt oilfields. It is estimated by the IMF that the pre-salt oilfields will add 50 to 100 billion barrels to the proven oil reserves of 15 billion barrels. This would increase Brazil’s oil production from its current level of around two million barrels per day to three million barrels per day by the end of 2020 making Brazil one of the top-five oil economies in the world.
Figure 2.5: Total crude oil production 2000 - 2020 (Million barrels per day)
003 003 003 002 002 002 002 002 001 001 001 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2016 2020
Note: forecast compiled by Bloem Doze Nienhuis. Source: ANP
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In its 2011-2015 business plan Petrobras laid out plans to invest 224.7 billion dollar of which 53 billion dollar will be invested in pre-salt exploration and production activities. This is a substantial increase compared to 33 billion dollar targeted in last year’s plan. Although Petrobras will finance most of this work through operating cash flow, the company's 2010 initial public offering (67 billion dollar) and 2011 and 2012 corporate debt offerings (6 billion dollar and 7 billion dollar respectively) all set records.
Local content demands play an important role in the purchasing policy of the Brazilian Oil and Gas sector. The chief of staff of Brazilian Petroleum Agency ANP declared17 recently that a debate is going on about the local content demands: 1. Waiver conditions concerning delivery times, price, quality, lack of local offer or suitable technology 2. A new arrangement to induce more efficiently the development of technologies actually important for the Brazilian oil and gas sector.
Although this is a hopeful sign, practice learns that the development is unfortunately the other way around towards more stringent control.
2.6. Dredging and port construction
The expansion of the Brazilian ports, shipyards, offshore fields, and energy related industries, has created a new demand for dredging contractors. Their activities include trenching, stone dumping and pipe landings for the offshore industry, the creation or enlargement of ports and terminals and the deepening of coastal areas.
Royal Boskalis Westminster last year18 announced a new contract for the development of the new TX2 port in the Complex Superporto do Açu. This 200 million euro complex will host South America’s largest shipyard and will be built by OSX Construç o Naval / EBX-group of the Brazilian entrepreneur Eike Batista. This project will be realized in the ã Northern part of Rio de Janeiro State. Also Van Oord is active in the Brazilian market. In the region of Suape the company is currently responsible for projects to a value of 165 million euro. Activities include the deepening of a canal towards the industrial port of Suape and the dredging of a canal for the Promar shipyard.
......
17 Silvio Jablonski, ‘The Brazilian Oil and Gas Sector: highlights and opportunities’, Cartagena July 2012 18 Boskalis Press Release, August 1st 2011
38 BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
2.7. Inland navigation
The eleven main waterways have a potential of 16.724 kilometres, of which some 13.000 kilometres is economically used. In spite of this large potential, only 13 per cent of transportation in Brazil is done by waterways, 60 per cent of goods are transported by truck and 27 per cent by rail19. In the Southern part of Brazil, the problem is that a significant part of the rivers are flowing inland instead of flowing to the sea, and that Rio de Janeiro does not have direct river access. Santos however, can be connected to the Tiete waterway.
Inland shipping can contribute to a safer, more efficient and greener modal split. Also in the field of passenger transport, inland navigation can play a more prominent role. It is not only suitable for transportation in underdeveloped regions, but in the growing market of cruise shipping as well.
2.8. Knowledge exchange
In the field of knowledge, there are three possible fields of co-operation: • technology: driven from a perspective of local demand. The ultimate goal is technology; transfer. This gives an advantage to local companies. However, the challenges of exploiting the oil reserves are that high that foreign know how is very welcome. LNG is a topic, but only on the long run. Deep sea technology is a possible topic of co-operation • transport, logistics, port construction: the development of new infrastructure is of paramount importance. Economic researchers, construction engineers, and logistic experts (including inland waterways) will have many business opportunities • trainings: there is a large demand for knowledge in the field of shipbuilding, offshore and logistics.
The Brazilians invest a lot in knowledge development. One of the technology partners is MARIN. They work together with CENPES -the naval architecture branch of Petrobras- and the University of Sao Paolo. The oil companies are forced to spend a small percentage of their turnover on R&D. MARIN has a local agent and a shared simulator facility. There is competition from the universities, who in practice work as engineering firms. MARIN considers to setup a research foundation in Brazil, in order to better position themselves for the local funding. STC has an active co-operation with SENAI in the field of vocational training, including shipbuilding. This Rotterdam based institute is also active in the field of consultancy for Transpetro (inland shipping), Vale (training) and CSN (consultancy tug operations). It is almost accredited for VTS-training for the Brazilian ports. Several port studies are being done and as per January 2012 STC Brazil is operational.
......
19 ABTC
39 Maritime Hotspots
TNO is also active in Brazil. Activities are done for the development of the Rio de Janeiro port.
2.9. Company experiences
Because of the size and complexity of the oil operations in Brazil, increasingly foreign subcontractors and oil companies are needed. This certainly gives new opportunities for companies from the Netherlands. The Dutch have a good name in Brazil. The Dutch are perceived as reliable and driven by solutions rather than problems. Reliability is what counts in the offshore sector, even more important than innovation.
Although Brazil has a stable government, and large projects are privately financed, Dutch companies do not always mention the Brazilian business climate as a role model. During the interviews with Dutch companies, by far the most mentioned aspect was the red tape: • taxations of imported and exported materials are complex • the rules and regulations in the field of local content are becoming more stringent • not only the main products, but also sub deliveries are part of local content demands • due to protectionism, local prices are high and local quality is below standard. Also in terms of capacity it is hard to subcontract locally • the war against corruption sometimes leads to detailed new rules that make business hard • increasing environmental legislation complicates investments in infrastructure.
From the perspective of financial institutions, Brazil is challenging. Billions of investments are needed to support the maritime and offshore fleet. The problem is however that banks are currently very reluctant to finance ships in the traditional way. This means that new financial engineering is needed. This search for alternative finance sources could be an opportunity for Dutch financial institutions and experts.
According to a Dutch offshore operator that had a project for a crane ship in Rio de Janeiro, the main challenge is to prepare every detail. It is important to realize that procedures are complicated and long, and that Brazilians like to do business with each other. Good agents are essential, as well as double checks with lawyers and tax people. All contacts go through middlemen, also with authorities.
The fulfilment of all rules and regulations is a costly affair. For the offshore ship owners, it is not so much a matter of local content, but regulations, certificates and audits makes business life uneasy in Brazil. Often procedures are only clear at the latest possible moment. As an example: the clearance of goods closes each week on Friday 15:00hrs, after that the weekend starts.
40 BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
Dutch ship-owners say that Brazil is geared towards their own domestic values. For example: when a ship calls on the port of Rio de Janeiro, the port authorities need a declaration of good behaviour of every person working on board. If you do not strictly comply, working permits are refused. And to make it even worse: everything has to be translated and officially approved.
A Dutch offshore company sees Rio as a growing market with large operations and great business opportunities in the near future. They co-operate with local dredging contractors as well as subcontractors. But when their work peaks they are too small to comprehend everything and vice versa.
The respondents were all positive about the support of the Dutch diplomatic services.
2.10. Conclusions and recommendations
The next graph shows our assessment of market opportunities. On a 1-to-10-scale we have attributed a score per sector. Offshore energy and ports and terminals have the highest weight. The shipbuilding and shipping in Rio de Janeiro are rated as a 4. This graph confirms the many market opportunities in Rio de Janeiro.
Figure 2.6: Rio de Janeiro Market opportunity assessment Rio de Janeiro
10 9 8 7 6 5 4 3 2 1 Average 0 MarketOpportunity
Source: Analysed by Bloem Doze Nienhuis
41 Maritime Hotspots
In summary, the risks and challenges of doing business in Brazil, perceived by Norwegian suppliers20 by Booz&Co21, and the Dutch respondents all share the same view:
The Brazilian government regulations create a large administrative burden for those who want to do business. It is costly and time consuming to fulfil all regulations, audits, certificates and working permits. Taxes are high and sometimes not transparent. Customs are complex and fragmented, vary between regions and are at supplier’s risk. Proposed Regulatory Reforms for Presalt - Petrobras ”monopoly” customer: Either ’in’ or ‘out’, and the reforms may limit a diversified supplier market. There are rigorous qualification and tendering processes: if technically acceptable, the price is the main evaluation factor. Technical developments purely driven by own demands offshore oil and gas. Local Content requirements may prevent the introduction of new players and new technologies due to high investments prior to deliveries. The absence of skilled labour make the local content demands even harder to fulfil for foreign companies. High entry costs require your best competence for a long period of time. Local presence is a key factor for business success in Brazil.
On the other hand, there certainly are possibilities for investments in ports and logistics. The increasing lobby of environmental interests should be taken into consideration. A tendency is seen that the monopoly of Petrobras is decreasing. SME companies increasingly focus on other Brazilian players. The economic activities are more and more spread along the coastline, to other areas like the Amazone mouth, Recife and the far South.
......
20 Rune Norseng, Regional Director, INTSOK Brazil O&G Market, Opportunities for Norwegian Suppliers 21 Booz&Co/ONIP, Competitive agenda for offshore oil and gas supply chain in Brazil
42 BIRD’S-EYE VIEW Maritime Hotspot Rio de Janeiro
Recommendations:
1. Rio de Janeiro - Santos is with no doubt a maritime hotspot. The business environment is however harsh. An excellent support from Dutch government is a prerequisite in fighting non-tariff barriers, positioning Dutch companies in large Brazilian tenders and troubleshooting
2. It is recommended to further strengthen Holland Marine House Brazil, strengthen ties with the Consulate General, and stimulate the permanent presence on the Brazilian market
3. Further research is recommended in the field of best practices from the competition. Comparison of trade policies of e.g. USA, Norway, Denmark, UK and Belgium can lead to a better performance of the Dutch and the creation of a level playing field with regard to export credit conditions
4. There are already good relations in the field of technology development and logistic research. Explore the possibilities of a permanent technology and knowledge exchange, including exchange of students, PhD’s and technology staff from companies
5. Organise permanent information exchange within The Netherlands, in order to strengthen our propositions in Brazil and to build up a network. Show our unity by showing the brand Maritime by Holland at the Brazilian decision makers.
43 Maritime Hotspots
44 BIRD’S-EYE VIEW Maritime Hotspot Singapore
3. BIRD’S-EYE VIEW Maritime Hotspot Singapore
3.1. Introduction
General Measuring approximately 683 square kilometres, Singapore has the highest concentration of millionaires in the world. The recipe for success lies in the combination of strong and reliable governance, little corruption, hands on economic policymaking, planning strategically to stay ahead of rivals, investments in human capital, a well regulated financial market, and a strategic geographic location. Gordon et. al. (2005) say that Singapore has sustainable competitive advantage in comparison with different ports in the world.
21 per cent of Singapore’s total economic activities comes from the manufacturing industry. Considering that Singapore is a developed country, this is a high percentage. It is caused by the many offshore activities.
45 Maritime Hotspots
Figure 3.1: Singapore’s Economy 2011
Construction 4% Others 6% Other Manufacturing Information & Services 21% Communications Industries 4% 11%
Accomodation & Wholesale & Food Services Retail Trade 3% Business Services 17% 14%
Finance & Insurance 12% Transport & Storage 8%
Source: Ministry of Trade and Industry, Singapore
Foreign trade According to the National Statistical Office of Singapore (Singstat) total foreign trade in 2011 totalled almost one trillion Singapore dollars (620 billion euro). This was an increase of two per cent compared to 2010 and the highest volume in the last four years. During the first eight months of 2012 total foreign trade increased with four per cent against the same period in 2011 to approximately 670 billion Singapore dollars (420 billion euro).
Figure 3.2: Singapore’s total trade (million Singapore dollars)
1000000,0 900000,0 800000,0 700000,0 600000,0 500000,0 400000,0 300000,0 200000,0 100000,0 ,0 2008 2009 2010 2011 2012*
Imports Exports
Note: January – August / Source: Singstat
46 BIRD’S-EYE VIEW Maritime Hotspot Singapore
3.2. Ports and Terminals
According to the Maritime Port and Authority of Singapore (MPA), a total of 127.998 vessels arrived at the port of Singapore during 2011 of which 8.235 vessels for repair and maintenance. The city has one of the biggest container terminals in the world, with a total volume of 29.37 million TEUs of containers in 2011.
Since Singapore has only 5 million inhabitants, it presents itself as an R&D lab and hub for the region. Almost the entire government policy is focused on the economic development of Singapore. It is a “living lab” where foreign research, technologies and companies are encouraged and facilitated by the Singapore government. A foreign company that has an interesting technology, has often the opportunity to test, to adjust, and then to market the technology in Singapore. Singapore then goes into joint ventures with the foreign companies or buy the technology to make this as a domestic product for the regional market. An example of the Singapore policy is The New Generation Container Port Challenge (NGCP)22. This is a challenge for all interested; individuals, professionals, companies and research institutions of any nationality of all sectors. It is to encourage cross-sharing and adoption of ideas from other domains. The challenge was presented during the Singapore Maritime Week from 22 April to 27 April 2012, where interested parties could subscribe. End of 2012 is the deadline for innovative ideas. With the Dutch expertise about this subject, it is strongly advised to apply for this challenge.
To meet Singapore’s rising demand for energy in the future, the sources of energy must be diversified. Therefore, the Singapore Government announced its decision to build an LNG terminal23. The terminal is focused on import, export, storage and distribution of LNG. This LNG terminal will be completed in 2013.
Cargo tonnages The financial crises had its effect on the total cargo tonnages. When we compare the years 2008 and 2009, we see a decline in the number of total cargo tonnages of 8.4 per cent. In the year 2010, the total cargo tonnages were already back at the same level as before the start of the worldwide financial crisis. In 2011 total cargo handled at Singapore’s ports reached a new high of 531 million tonnes. For 2012 it is forecasted that general cargo will increase with about five per cent compared to 2011 reaching a level of 355 million tonnes. Bulk cargo, instead, is forecasted to decrease with ten per cent to 175 million tonnes in 2012. This decrease is caused by a lower demand of oil from Europe and the United States as their economies will see low economic growth rates or even a (mild) recession in the case of the Eurozone. For the near future we see a continuation of this trend with a slight decline in the volume of oil-in-bulk and a slight increase in the general and bulk (non-oil) cargo.
......
22 http://www.maritimeinstitute.sg/Programmes_Initiatives/Port_Challenge.aspx 23 http://www.slng.com.sg/about-us-overview.html
47 Maritime Hotspots
Figure 3.3: Total Sea Cargo Handled (thousand tonnes)
400000,0 350000,0 300000,0 250000,0 General cargo Bulk cargo 200000,0 150000,0 100000,0 2004 2005 2006 2007 2008 2009 2010 2011 2012*
Note: (*)2012 forecast analysed by Bloem Doze Nienhuis / Source: MPA
Container throughput Total container throughput recovered very strongly from the worldwide financial crisis of 2008 – 2009. In 2009 total throughput of containers was at a level of 25.9 million TEUs, in 2011 the volume was increased with sixteen per cent to thirty million TEUs. The forecast for 2012 is an increase in container throughput to approximately 31 million TEUs and the number of sea passengers handled at the terminal in Singapore will increase to reach almost the same level as in 2009 of 6.6 million people. This is still below pre-crisis level.
Figure 3.4: Container throughput and sea passengers handled
35000,0 7700,0
30000,0 7200,0
25000,0 6700,0
20000,0 6200,0 2004 2005 2006 2007 2008 2009 2010 2011 2012*
Total container throughput (R-axis, '000 TEUs) Sea passenger handled (thousands)
Note: (*)2012 forecast analysed by Bloem Doze Nienhuis / Source: MPA, Ministry of Trade and Industry, Singapore.
In 2011, a milestone was reached in Singapore’s maritime history when annual vessel arrival tonnage at PSA crossed the two billion gross tonnes (GT) mark for the first time. A total of 127.000 vessels contributed to this number. The number of cargo vessel arrivals doubled since 2004. For 2012 we expect a slight decrease in the number of cargo vessels, but a continuation of the total number of vessels arriving at Singapore’s ports and total GT.
48 BIRD’S-EYE VIEW Maritime Hotspot Singapore
Figure 3.5: Vessel arrivals (include all sea-going vessels & regional ferries above 75GT)
134000,0 65000,0 133000,0 60000,0 132000,0 55000,0 131000,0 50000,0 130000,0 45000,0 129000,0 40000,0 128000,0 35000,0 127000,0 30000,0 2004 2005 2006 2007 2008 2009 2010 2011 2012*
Total (R-axis) Cargo vessels
Note: (*)2012 forecast analysed by Bloem Doze Nienhuis / Source: MPA
3.3. Shipping
Singapore has a strong International Maritime Policy. The Ministry of Transport regulates the maritime sector24. Singapore wants to remain among the world’s best by investing in infrastructure, knowledge and innovation. It is very focused on attracting foreign knowledge and technology (Maritime knowledge hub). There are initiatives set up to stimulate this. An important one is Singapore Maritime Institute (SMI). This is a joint effort by PSA, A * STAR (Agency for Science, Technology and Research) and EDB (Economic Development Board). The SMI focusses on shipping, port, maritime services, offshore and marine engineering. They aim to develop strategies and programmes related to the academic, policy and R&D aspects of the maritime industry25. There is 350 million Singapore dollar (220 million euro) available to finance initiatives through this programme. The SMI hopes to attract foreign researchers to come to work in Singapore. In this way, Singapore tries to increase the R&D level in the maritime industry.
The Singapore flag ranks among the top ten26 largest registries in the world, with more than 3.300 registered vessels. The average age of the vessels is nine years, the average DWT tonnes is more than 29.000 and the average GT is 16.690.
......
24 http://www.mpa.gov.sg/sites/global_navigation/maritime_singapore.page 25 http://www.maritimeinstitute.sg/About_Us/Background.aspx 26 http://www.mpa.gov.sg/sites/maritime_singapore/what_maritime_singapore_offer/global_maritime_ service/quality_ship_ registry.page
49 Maritime Hotspots
Table 3.1: Singapore flagged ships
Average DWT Average GT Flag Country Vessels Average Age (tonnes) (tonnes)
Singapore 3.375 9 29.361 16.690
Source: Clarkson
In 2011, total gross tonnages of Singapore registry of vessels was 57 million tonnes. This is a growth of more than 17.5 per cent compared to 2010. Despite the decline in seaborne trade during the worldwide financial crisis in 2009, the number of registered vessels increased by 4.4 per cent.
Table 3.2: Singapore registered ships
Singapore Registry of Vessels (in ’000GT)
2007 39.603
2008 43.702
2009 45.632
2010 48.783
2011 57.360
Source: Clarkson
The total fleet owned by Singapore companies consists of 3.543 vessels. The average age of the vessels is seventeen years. Total DWT exceeds 52 million. The total GT of the fleet is 33.5 million.
Table 3.3: Singapore owned ships
Owner Nationality Singapore
Total Vessels 3.543
Average Age 17
Total DWT (tonnes) 52.426.992
Total GT (tonnes) 33.556.418
Source: Clarkson
The five main owners in Singapore measured by total GT are: • Ocean Tankers Pte (106 vessels): Chemical, products & oil tankers • Neptune Orient Lines (49 vessels): Container vessels • BW Maritime Pte (33 vessels): Chemical, products & oil tankers • Berge Bulk AS (21 vessels): Bulk carriers • Pacific Int. Lines (109 vessels): Container and MPP vessels.
50 BIRD’S-EYE VIEW Maritime Hotspot Singapore
3.4. Shipbuilding industries
Some of the most prominent shipyards are based in Singapore. It is clear that the small city-state of Singapore plays a vital role in the regional economy of South East Asia and far beyond. It has a twenty per cent world market share in ship repairs. The Singapore shipyards are highly specialised in offshore supply and support ships, as well as on large offshore structures. The two most prominent shipyard groups are Semcorp and Keppel Offshore Marine. One problem that shipyards had in Singapore is the lack of land. However, with the development of the mega yard in the SW Peninsula of Singapore this seems to be an overcome topic. The shipyards are mainly located in the South Western part of Singapore.
Figure 3.6: Location of yards in Singapore
Source: Company Data, Analysed by Bloem Doze Nienhuis
According to the Association of Singapore Marine Industries (ASMI), the total shipbuilding capacity exceeds 3 million DWT with the largest dry-dock capacity in Jurong Shipyard (500.000 DWT).
51 Maritime Hotspots
Table 3.4: Shipbuilding capacity in Singapore
Capacity No. of docks Total DWT Builder name
5.000 1 5.000 Keppel Singmarine
7.500 1 7.500
10.000 1 10.000
100.000 2 200.000 Jurong Shipyard, Sembawang Shipyard
150.000 1 150.000 Keppel Shipyard (Tuas)
170.000 1 170.000 Keppel Shipyard (Benoi)
200.000 1 200.000 Jurong Shipyard
300.000 2 600.000 Keppel Shipyard (Benoi), Jurong Shipyard
330.000 1 330.000 Keppel Shipyard (Tuas)
360.000 1 360.000 Keppel Shipyard (Tuas)
400.000 2 800.000 Keppel FELS Pioneer Yard, Sembawang Shipyard
500.000 1 500.000 Jurong Shipyard
Total 15 3.332.500
Source: Association of Singapore Marine Industries
An example is ASL Shipyards. They secured the largest number of shipbuilding contracts during 2011: 16 vessels (9 AHTS vessels, 2 platform supply vessels, 2 North Sea emergency response and rescue vessels, 2 barges and 1 dredger) with a combined contract value of some 400 million Singapore dollar. This brings the company’s shipbuilding orderbook from external customers to over 500 million Singapore dollars with progressive deliveries extending to 2014.
52 BIRD’S-EYE VIEW Maritime Hotspot Singapore
According to Clarkson, at this moment, the orderbook is as follows:
Table 3.5: Orderbook shipbuilders in Singapore region
Builder Total Average Average Total GT Total CGT Builder Name Yard Vessels DWT DWT GT (tonnes) (tonnes) Location (tonnes) (tonnes) (tonnes)
Sembawang Shipyard Singapore 2 N/A 105.062 71.802 N/A 52.531
Drydocks World Sing. Singapore 8 20.700 66.216 86.865 4.140 8.277
ST Marine Jurong 6 24.300 39.630 64.451 4.050 6.605 Jaya S.B. & Eng Singapore 3 11.500 11.070 9.151 3.833 3.690
ASL S.Y. Singapore 6 10.600 10.818 29.636 1.766 1.803
Pacific Richfield Singapore 4 6.200 10.352 23.762 2.066 2.588
Keppel FELS Singapore 2 1.500 8.245 14.761 1.500 4.122
Oakwell Shipbuilding Singapore 1 531 2.000 5.121 531 2.000
Strategic Marine (S) Singapore 6 319 1.350 6.969 106 225
Penguin S.Y. Singapore 3 603 832 4.337 201 277
Keppel Singmarine Jurong 2 N/A 700 3.468 N/A 350
Source: Clarksons
According to the Ship-owner Orderbook Monitor of Clarkson in January 2012, Singapore stands at the 8th place globally. With a total of 299 orders, 4.5 million CGT is being build. Top of the list are offshore vessels as the offshore industry strengthens. The preferences is for larger and technologically advanced AHTS vessels capable of meeting the demanding requirements for supporting deep water operations. According to the ‘Offshore Supply Vessel Market Outlook’ of DVB bank it is expected that AHTS vessels gain the most in utilisation rates. The analysts forecast a return to 2008 levels by 2013, with a more moderate growth rate expected for smaller vessels.
3.5. Offshore energy
Singapore is home to a thriving offshore industry. It is a global leader in the production of offshore oil-rigs (seventy per cent world market share) and FPSO conversion (seventy per cent world market share). Singapore’s maritime industry profited strongly from the increased demand in oil and gas services. Between 2001 and 2009 total turnover in the maritime industry quadrupled after which it declined in 2010 and 2011 to the same level as 2007. Employment in the maritime industry showed the same trend.
The offshore sector has grown accordingly. In 2001 it generated a turnover of almost one billion Singapore dollars . During the past ten years this figure increased seven
53 Maritime Hotspots
fold to7.5 billion Singapore dollars in 2011 after it peaked even 9.3 billion Singapore dollars in 2009. This peak was mainly caused by contracts from before the worldwide financial crisis. Comparatively, growth in turnover in the shipbuilding sector has remained stable (from 0.5 billion Singapore dollar in 2001 to 0.7 billion Singapore dollar in 2011), and ship repair has grown moderately from 2.6 billion Singapore dollar in 2001 to 5.2 billion Singapore dollar in 2011.
Driven by the high oil prices, many ship repair companies expanded aggressively into the offshore sector during the past ten years. Examples are Keppel Offshore Marine and Sembcorp Marine. These companies have undergone an evolution from ship repair businesses in the early 1960’s to offshore production companies this century27. Keppel Corporation's biggest win came on August 7, 2012, when the company firmed up contracts with Sete Brasil for the design and construction of five semisubmersible drilling rigs for approximately 4.1 billion dollar. Furthermore, at 10 August 2012 the latest purchase of Keppel is announced for the fabrication of FPSOs by Petrobras worth a total of 950 million dollar.
Sembcorp Marine's largest score this year also came from Sete Brasil. The company secured on August 8, 2012 contracts for five drill ships worth approximately 4 billion dollar from Sete Brasil28. This confirms the increase of the offshore sector and the link of the different maritime hotspots. Moreover, Sembcorp has secured a contract worth 135 million dollar in August 2012 from Diamond Offshore for the Ocean Apex Project29. This is a rig that will be capable of operations in water depths of up to 6.000 feet. Design specifications also include a variable deck load of 7.000 long tonnes, a maximum hook-load capacity of two million pounds, crew quarters capacity for 140 personnel and a very large deck space. This is scheduled to be delivered from Singapore during the second quarter of 2014 and will add new capacity to Diamond’s deep water fleet.
......
27 http://www.kepcorp.com/en/content.aspx?sid=86 28 http://www.rigzone.com/news/oil_gas/a/120156/Sembcorp_Keppel_Could_End_2012_with_Over_ 16B_ 29 http://www.sembcorpmarine.com.sg/index.php?mact=News,cntnt01,detail,0&cntnt01articleid=391&cnt nt01returnid=78
54 BIRD’S-EYE VIEW Maritime Hotspot Singapore
Figure 3.7: Turnover and employment of the maritime industry, 2001-2011
18 160 16 140 14 120 12 100 10 80 8 60 6 4 40 Employment Employment '000 Turnover S$ Billion 2 20 0 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Ship Repair Shipbuilding Offshore Manufacturing Employment
Source: Association of Singapore Marine Industries
3.6. Dredging and port construction
The PSA has announced30 further investments of 3.5 billion Singapore dollars (2.2 billion euro) in the development of its Pasir Panjang Terminal (PPT). With nearly 6.000 metres of quay length and up to 18 metres draft, the new terminals will be able to serve the next generation of containerships. The investments aim to increase Singapore total container handling capacity to 50 million TEUs per year.
Also this year, the Maritime and Port Authority of Singapore (MPA) started Phase 4 construction of Jurong Island Reclamation. Apart from this, many other dredging and
......
30 Dredging today.com, ‘Singapore: PSA Launches Pasir Panjang Development Plan’ Oct 1st, 2012
55 Maritime Hotspots
water construction works are carried out like the Bukit Timah Flood Protection Plan, the construction of new marina’s, and in the early 2000’s the large land reclamation projects. The large scale dredging activities are highly political sensitive, as we witnessed during the ‘sand war’ with Jakarta. According to critics, the seawards increase of Singapore further narrows the overcrowded Singapore straight and damages coral reefs. It is in these circumstances that the Dutch dredging companies carefully and responsibly have to find their business position.
3.7. Company experiences
Singapore is the logistic pivotal point for Asia. All big players are there. Heerema, APM Terminals and Damen do regular business in Singapore. Also banks, like ABN-AMRO have a Dutch desk in Singapore, with an emphasis on marine and offshore.
Singapore’s Economic Development Board approach is very pro-active and useful. It has a good climate for business, it is transparent, reliable and non-bureaucratic with good relations. Another advantage is that Singapore workers have a strong hands-on and service mentality. This gives Dutch companies a good basis.
HME BV has recently opened an office in Singapore. From this location, all Asia activities are being coordinated.
3.8. Conclusions and recommendations
The next graph shows our assessment of market opportunities. On a 1-to-10-scale we have attributed a score per sector. The offshore & energy sector in Singapore weigh heavily on the average. The average gives a value between 5 and 6. Just like the other maritime hotspots, this is a score above average. It must be kept in mind however, that Singapore is a full-grown market, with less spectacular growth percentages than other upcoming regions.
56 BIRD’S-EYE VIEW Maritime Hotspot Singapore
Figure 3.8: Singapore Market opportunity assessment Singapore
10 9 8 7 6 5 4 3 Average 2 MarketOpportunity 1 0
Source: Analysed by Bloem Doze Nienhuis
Conclusions:
• Singapore is a global maritime hub, with over 5,000 companies active in the maritime cluster, and responsible for 7% of GDP. It combines dry and wet bunker trading with advanced shipbuilding and repair. It serves as a pivot point for South East Asia • The state of Singapore is well organised, transparent, and reliable, with a high service mentality, excellent financial, legal and port services and a dedicated government with research funds for maritime, energy and offshore business • The role of government is pro-active, with a strong focus on marine and offshore. However, their own long term interest always prevails. Government investment company TEMASEK is deeply rooted in society but has not always a clear role • Many Dutch companies are already located in Singapore • Stringent labour legislation. Increasing pressure to work with Singapore employees, foreign employees are discouraged to work there • Singapore is an expensive location, but can make use of the cheap hinterland Malaysia • It is difficult to get in informal touch with the shipyards. Everything is through formal contacts.
57 Maritime Hotspots
Recommendations
1. Dutch diplomatic support should be hands on and more focused on the possibilities of the marine and offshore sector. Dutch economic diplomacy and working relations should be done on top level
2. Importance of close personal relations, we should show our face more often at the maritime authorities. Focused Trade missions should be organised regularly. The presence of the Royal family, ministers and high industrial personalities opens doors
3. Invest in personnel exchange and create opportunities for high potential Singaporese to work in the Netherlands
4. R&D programs, cooperation with National University of Singapore. Since 2004, the Centre for Offshore Research and Engineering (CORE) launched an offshore engineering specialization . The link between the Dutch and Singaporese knowledge community is sensitive with respect to competition. Be careful when investments in the exchange of knowhow.
58 BIRD’S-EYE VIEW Maritime Hotspot Shanghai
4. BIRD’S-EYE VIEW Maritime Hotspot Shanghai
4.1. Introduction
Shanghai (literally meaning ‘Going to the sea’) is situated in the far East of China. It has a strategic geographical location at the mouth of the Yangtze river and is home to an elaborated maritime cluster. The city and port have advanced neighbouring provinces (Jiangsu, Zhejiang and Anhui and further west along the Yangtze), and complete distribution infrastructure. Excellent hinterland connections, including first class highways and railroads, are a fertile soil for logistics operations.
The city of Shanghai attaches great value to the development of its maritime cluster. In 2007, Shanghai’s Shipping Service Centre Project was launched. Located across the Huangpo River in Pudong, it aims at establishing functions around ship finance, legal affairs and training. In February 2011, Shanghai launched a 50 billion Yuan investment fund to support the international shipping centre.
The education level of the Chinese is rising, and also their capacity to understand the basic processes of our industry. Doing business in Shanghai is nice, but not always
59 Maritime Hotspots
easy. It is quite easy to lose grip on your own product, or to be swallowed up by larger entities with deep pockets. Protection of intellectual property is a problem that appears to remain the same.
The relations between the Dutch maritime and Shanghai maritime community are traditionally strong. It is stimulated by the friendly relation between the two port cities of Shanghai and Rotterdam.
4.2. Ports and terminals
In the top fifteen of largest container ports in the world, seven ports are Chinese. The port of Shanghai is the largest container port of the world with a throughput in 2011 of 31.7 million TEUs containers. In comparison, the port of Rotterdam had a throughput in 2011 of 11.9 million TEUs containers resulting in a top ten position.
Table 1: Top 15 Largest Container Ports of the World
Top 15 container terminals and their throughput, 2011 (million TEUs)
Shanghai, China Singapore, Singapore Hong Kong, China Shenzhen, China Busan, South Korea Ningbo, China Qingdao, China Guangzhou, China Dubai, UAE Rotterdam, the Netherlands Tianjin, China Kaohsiung, Taiwan Port Kelang, Malaysia Hamburg, Germany Antwerp, Belgium 0 5 10 15 20 25 30 35
Source: World Shipping Council
60 BIRD’S-EYE VIEW Maritime Hotspot Shanghai
Figure 4.1: Chinese ports
Source: www.ec.cn
Although Shanghai Port comprises three container terminals, namely Wusong, Waigaoqiao and Yangshan, Yangshan is the only deep-water port.31
Figure 4.2: Volume of goods and containers handled at Shanghai Port
3400,0 52000,0 3200,0 3000,0 47000,0 2800,0 42000,0 2600,0
'000 '000 TEUS 2400,0 37000,0
2200,0 million tonnes 2000,0 32000,0 2007 2008 2009 2010 2011 2012*
Containers (L-axis) Cargo
Note: 2012 forecast analysed by Bloem Doze Nienhuis / Source: SIPG
The Shanghai port operator Shanghai International Port Group (SIPG) is aiming at a consolidation of its strong growth over the past few years. Between 2007 and 2011 the volume of containers increased with 20 per cent, whereas the volume of cargo handled at Shanghai Port increased with 37 per cent even much faster. For 2012 it is forecasted a further increase in volume despite the economic crisis in Europe and slow economic growth in the United States. Within their Yangtze River Strategy, they aim for growth in the container market, strengthening the cargo network and support
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31 www.sh-pilots.com.cn
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hinterland cargo sources. They are eager to establish Shanghai as an international shipping centre and enhance ship-to-ship transhipments in the Yangshan Port. International bilateral relations with other ports are actively sought.
According to a report by the Shanghai-based newspaper Dongfang Daily, the government of Shanghai’s Pudong New Area introduces a series of supportive measures to motivate the development of shipping-related industries32 in Shanghai.
The policy package includes one-time subsidies, tax subsidies and soft environment improvement, offered to both key shipping companies and high-end maritime services companies (financial, brokerage, legal, training). Employees and executives working for key shipping will get benefits, as well as foreign talents.
4.3. Shipping
Currently 4.154 vessels are sailing under the Chinese flag. The average age of the vessels is 21 years, with an average DWT of 18.226 tonnes. The average GT of the vessels under Chinese flag, is just over ten thousand GT.
Table 4.1: Chinese flagged ships
Average DWT Average GT Flag Country Vessels Average Age (tonnes) (tonnes)
China 4.154 21 18.226 10.490
Source: Clarkson
In total almost 7.000 vessels are under Chinese ownership. The vessels have an average age of 23 years old. All vessels combined have a DWT of 166 million tonnes. The total GT is over 100 million tonnes.
Table 4.2: Chinese owned ships
Owner Nationality China
Total Vessels 6.744 Average Age 23
Total DWT (tonnes) 166.000.702
Total GT (tonnes) 102.087.463
Source: Clarkson
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32 China Briefing, “Shanghai to Offer Incentives to Shipping-Related Industries”, November 7, 2011
62 BIRD’S-EYE VIEW Maritime Hotspot Shanghai
Large shipping companies in China are among others: • China Ocean Shipping Company (COSCO): China's largest shipping, logistics and ship building group. It owns and controls over 800 merchant vessels with a total tonnage of 56 million DWTs and an annual carrying capacity of 400 million tonnes. It is active in all major trades: containers, dry bulk, tankers, and special ships. It has shipbuilding and ship-repairing facilities to a total of sixteen docks including 300.000-ton-class docks and 500.000-ton-class docks. Headquarters in Beijing, main activities in Shanghai • China Shipping Group: established in 1997 the company is operating in a broad range of maritime activities such as container, oil, freight, passenger, LNG and car transport. Other related businesses in which the Group is active are terminal operating, integrated logistics, shipping agency and ship repair. Its fleet contains 500 vessels with a total capacity of 600.000 TEUs and 28 million DWT • China Shipping Container Lines (CSCL, Shanghai): a subsidiary of the China Shipping Group is specialized in container liner services. As of the end of 2010 its fleet comprises over 143 vessels with a total operating capacity of 513.772TEUs, ranking among the world's top 10 liner companies • China Shipping Development Tanker Company (CSDTC, Shanghai): a subsidiary of the China Shipping Group and is mainly engaged in domestic and overseas crude oil and product oil shipping. As of the end of 2009, it owns and operates 69 tankers with a total carrying capacity of 5.546.200 tonnes.
Tax policy The major taxes in China are value-added tax, consumption tax, customs duty, business tax, enterprise income tax, individual income tax and land appreciation tax.33 Enterprise income tax law was modified in 2007 to take account of China’s entry to the WTO. Issued by the State Council in April 2009, a number of preferential tax and customs policies were announced. The policies extend the tax exemption for China- funded flag of convenience vessels to 30 June 2011.
For enterprises registered in the Shanghai Yangshan Free Trade Port (FTP), business tax is exempted on transportation, warehousing, loading and unloading revenue. Income derived within the FTP may be separated from the international part of the business. Further measures aim to foster the development of ship leasing and insurance in Shanghai.
Recently a senior official within the Policy and Legal Affairs Department of the State Taxation Administration announced that further tax benefits will be introduced including, for example, increased exemptions for enterprises within the Yangshan Bonded Zone. China has signed Double Taxation Agreements (DTAs) with 95 countries. Some incorporate specific provisions dealing with international shipping income.
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33 A. McKinnon, City University of Hong Kong, ‘Hong Kong and Shanghai Ports’, June 2011
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4.4. Shipbuilding industries
The Shanghai region is an important knowledge and construction base for the Chinese shipbuilding industry. Since 2005 major investments have been done in production facilities. These investments created large shipyards in and around the Shanghai region, geared towards building the largest ship types and maximizing capacity. This growth is unprecedented. It started from the late 1990’s and was steered from Beijing through the shipbuilding conglomerates CSSC (China State Shipbuilding Corporation) and CSIC (China Shipbuilding Industry Corporation). Their main purpose seems to be to make China the world’s largest shipbuilder enter high end markets like LNG carriers, and in the future designing and building cruise ships.
Table 4.3: Main shipbuilders in Shanghai region First Number Number Yard DWT Number Order Builder Name delivery of dry of Maximum Specialty of vessels book year docks berths (tonnes) delivered Jiangsu 2008 4 1 400.606 Tanker, Bulk Carriers 61 93 Rongsheng Shanghai 2003 2 320.000 Tanker, Bulk Carriers 168 36 Waigaoqiao Jiangsu New Bulk, Container 2005 2 2 120.000 108 62 YZJ Hudong MPP, Bulk Carriers, 1989 3 120.000 179 42 Zhonghua Container Nantong Cosco Bulk carriers, 1999 2 316.021 108 23 KHI Container Shanghai 2008 2 4 319.000 Bulk, Tanker 35 16 Jiangnan Jiangnan Container, Bulk 2009 2 5 115.664 48 24 Changxing Carriers
Source: Clarkson
At the moment, the orderbooks of aforementioned shipyards are as follows.
64 BIRD’S-EYE VIEW Maritime Hotspot Shanghai
Table 4.4: Orderbook shipbuilders in Shanghai region
Builder Average Average Total DWT Total GT Total CGT Builder Name Yard Vessels DWT GT (tonnes) (tonnes) (tonnes) Location (tonnes) (tonnes)
Jiangsu Rongsheng Nantong 93 14.717.826 7.864.582 2.766.062 158.256 84.565 Shanghai Shanghai 36 8.124.263 4.140.367 1.255.756 225.673 115.010 Waigaoqiao
Jiangsu New YZJ Jingjiang 62 4.235.307 3.108.488 1.623.714 68.311 50.136
Hudong Zhonghua Shanghai 42 3.363.621 2.778.311 1.498.922 80.086 66.150
Nantong Cosco KHI Nantong 23 1.837.460 1.689.024 757.837 83.520 73.435
Shanghai Jiangnan Changxing 16 3.109.200 1.583.346 513.436 194.325 98.959
Changxing Jiangnan Changxing 24 1.926.510 1.434.278 726.506 80.271 59.761 Island
Source: Clarkson
According to statistics from the China Association of the National Shipbuilding Industry (CANSI), during the first eight months of 2012 China’s new orders amounted to 1.459 million deadweight tonnes, down 48 per cent year-on-year. In comparison with the South Korean competitors, the Chinese shipyards are suffering comparatively hard. This is caused by the vessel types that are being built in China and the inability to switch to segments in the offshore sector. In spite of this, the capacity increase is going on. Near Shanghai the construction of the world’s largest shipyard is progressing. The shipyard will cover eight kilometres of coast along Shanghai's Changxi Island. It will be fully operational by 2015 with an annual capacity of eight million tonnes. Two existing shipyards in Shanghai, Jiangnan and Hudong, are relocated to the new facilities.
China aims to increase annual sales by domestic shipbuilders to 1.2 trillion Yuan (144 billion euro) by 2015 as it works toward its goal of becoming the world’s leading shipbuilding country, the Ministry of Industry and Information Technology said. A central part of the ministry’s plan for developing the sector is concentration of capacity. The plan calls for China to push forward with “structural improvements” to the industry, with the goal of seventy per cent of the country’s shipbuilding capacity concentrated among its ten largest shipbuilders by 2015. The plan also says China should aim to claim at least five of the world’s ten largest shipbuilding companies by 2015.34 It is doubtful whether Dutch industry will play any role in the ultra large Chinese shipyards. They serve large, standardized market segments, will be buying locally, and will be highly cost driven.
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34 Andrew Galbraith, Dow Jones Newswires, ‘China’s Shipbuilding Industry Shoots for the Stars…$189 Billion in Sales by 2015’ March 12, 2012
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4.5. Offshore energy
The Chinese wind power industry has developed significantly over the past decade. With its large land mass and long coastline, China has exceptional wind resources. China has an estimated offshore wind power potential of more than 750 gigawatts. It is far greater than the country's land-based wind potential of 253 gigawatts. China has identified wind power as a key growth component of the country's economy35. China aims to “have 100 gigawatts (GW) of on-grid wind power generating capacity by the end of 2015 and to generate 190 billion kilowatt hours (kWh) of wind power annually”36.
China's first major offshore initiative is the 102-megawatt, 337 million dollar Donghai Bridge Wind Farm. The project consists of 34 turbines, each with a 3-megawatt capacity. It was developed by Shanghai Donghai Wind Power Co. At May 2012, this project was expanded. China aims to develop 5 gigawatts of offshore wind farms by 2015. Shanghai Electric will provide 26 wind turbines, each with 3.6 megawatts of capacity.
China is a relative newcomer in the FPSO market. It has acquired substantial experience in managing and operating FPSOs. Since 1993, China has built 13 of the 17 floaters currently operating off China. Some of these producing floaters have also been upgraded or had their lifespans expanded. Ten yards are capable of building or converting FPSOs: Shanghai Waigaoqiao Shipyard, Shanghai Hudong, Jiangnan, Dalian New Shipyard, Cosco, Qingdao Beihai, Shanhaiguan, Changxing, Yantai Raffles and Hantong.
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35 http://www.guardian.co.uk/environment/2009/feb/03/wind-power-eu 36 http://www.reuters.com/article/2011/08/30/us-china-energy-renewable-idUSTRE77T0CM20110830
66 BIRD’S-EYE VIEW Maritime Hotspot Shanghai
11 of these 17 floaters are owned by state upstream giant China National Offshore Oil Corporation (CNOOC). It is the largest offshore oil and gas producer in China. In 2011, the company ranked 34th and 162nd in the Top 50 Global Oil Companies and Fortune Global 500.
One important project where CNOOC is involved (for 51 per cent) is the Beibu Gulf Project. It consists of three oil fields, is located about 60km from the southern coast of China and northwest of Hainan Island. At Bohai Bay, seven floaters are helping CNOOC to achieve its production target of 30 million cubic metres in the sea area next year. The Hai Yang Shi You 117 Pengbo is the latest and largest FPSO to be developed there. In June, 2012, CNOOC spent 100 million dollar for a 50 per cent stake in the Munin floating production. This is a storage and offloading vessel from Dutch marine contractor Bluewater. The company is interested because of the floater’s capacity for serving deep-water operations. The deal is subject to approval by China’s planning agency, the National Development & Reform Commission.
As there are no important oil and gas fields off the coast from Shanghai, this city cannot be considered as a major offshore hub. The Shanghai shipbuilding industry, however, is mainly involved in building offshore structure for domestic and foreign clients. Shanghai is more for offshore services, ship building, ship financing and shipyards.
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4.6. Dredging and port construction
It is forbidden in China for foreign companies to perform dredging operations. Logically, the Chinese market is dominated by domestic companies without any room for Dutch contractors. China is in fact a large market. Dutch shipyards supply dredging equipment to China.
CCCC is the largest dredging company in China. In 2012, it ranked 10th among ENR’s top 225 international contractor’s37, and it is the largest state-owned mainland Chinese infrastructure enterprise listed on the Hong Kong Stock Exchange. CCCC conducts its dredging operations primarily through two subsidiaries; China Harbor Engineering Company Ltd. and China Road and Bridge Company Ltd. However, it maintains a centralized management system that coordinates the overseas operations.
CCCC is very interested in strengthening and promoting cooperation between different parties. In June 2012 a meeting took place between the CCCC President Liu Qitao and IHC President Hamers38.
4.7. Inland navigation
The total freight traffic in 2011 stood at 36.9 billion tonnes, of which 11 per cent was waterway transport. Measured in freight flows, the share of waterways was 47 per cent.
According to the Chinese Ministry of Transport39, in spite of a decline in total fixed asset investments in transport, investments in inland river construction have increased by 33.1 per cent. The official reason for this is, that ‘water transport has such advantages as huge transport capacity, low energy consumer, few pollution and sustainability.’ It is positive that central and local governments now seem to have discovered the benefits of inland river transport. The development of inland river ports has further improved the transport capacity of inland rivers.
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37 http://www.dredgingtoday.com/2012/09/10/cccc-largest-chinese-international-contractor-for-6th-consecutive- year/ 38 http://en.ccccltd.cn/newscentre/companynews/201206/t20120621_11833.html 39 CE.en, August 14th 2012, ‘Inland shipping investment up 33.1per cent to 21.1 bln yuan’
68 BIRD’S-EYE VIEW Maritime Hotspot Shanghai
Table 4.5: Freight Traffic by All Means of Transportation and the Growth Rates in 2011 Increase over Item Unit Volume 2010 (per cent)
Total freight traffic 100 million tonnes 368,5 13.7
Railways 100 million tonnes 39,3 8.0
Highways 100 million tonnes 281,3 14.9
Waterways 100 million tonnes 42,3 11.7
Civil aviation 10 000 tonnes 552,8 -1.8
Pipelines 100 million tonnes 5.4 9.0
Freight flows 100 million ton-kilometres 159.014,1 12.1
Railways 100 million ton-kilometres 294.65,8 6.6
Highways 100 million ton-kilometres 513.33,2 18.3
Waterways 100 million ton-kilometres 75.196,2 9.9
Civil aviation 100 million ton-kilometres 171,7 -4.0
Pipelines 100 million ton-kilometres 2.847,2 29.6
Source: National Bureau of Statistics, China
The positive intentions have led to concrete actions to be performed in the years to come. The State Council and the Shanghai Municipal Government are pushing Shanghai to become a competitive international financial and navigation centre. By 2020 the construction of an international navigation centre in Shanghai must be finalized. It will contain concentrated navigation resources, complete navigation services, and an excellent market environment. The Yangshan Bonded Zone will be a free trade area, at the Yangshan port, off the Shanghai coast in Hangzhou Bay. The Shanghai government has promised a package of preferential tax policies, that upgrade its international competitiveness. Besides that, it aims for the development of advanced manufacturing and technology services.
Inland shipping looks like a promising sector in the Yangtze River Delta.
4.8. Yacht building
Triggered by the development of the Chinese economy, the rise in domestic and international tourism and changes in consumption preferences, China’s yachting business is on the rise. Although the international financial crisis causes the global yacht market to shrink since 2008, China's yacht market continues to grow. In 201140, the scale of China's yacht market was about 5.1 billion Yuan (440 million dollar). An
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40 CRI, Research report on Chinese Yacht Industry, May 4th 2012
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increase of 30 per cent compared to 2010. There are about 60 shipyards specialised in manufacturing small to medium sized yachts (< 24 metres) of which half are locally owned building mainly for the domestic market. The other shipyards are joint ventures or from Hong Kong/Taiwan building for the export markets in Europe and the USA thereby taking advantage of the low labour costs in China.
With more than 400 billionaires and over 100.000 millionaires, the Chinese market for super yacht (> 24 metres) building seems promising. But currently only about twenty companies in China can build super yachts. Examples are Cheoy Lee, CMC Yachts, Tricon Marine, Kingship and IAG Yachts. By the end of September 2012 only four super yachts were on order and twenty-one under construction at shipyards in China.
Table 4.6: New orders super yachts mid-2012 in China
Shipyard Type of yacht Length (metres) Delivery time
Cheoy Lee Motor 28.04 2014
Cheoy Lee Motor 26.20 2013
Tricon Marine Motor n.a. 2014
IAG Yachts Motor 41.0 2014
Source: Boat International
Not only did the number of billionaires and millionaires increased significantly during the past decade in China, there is also a rising middle class which can afford low to medium priced yachts. It is expected that in the next few years, the annual growth rate of China's yacht market will be over 20 per cent. For manufacturing enterprises, trading enterprises and service enterprises there are therefore many business opportunities.
Figure 4.3: Deliveries super yachts build in China
10,0 9 100 9,0 8,0 80 7,0 6,0 5 60 5,0 4 4,0 3 40
3,0 euro million 2,0 1 20 1,0 0 ,0 0 2007 2008 2009 2010 2011 2012*
Deliveries (L-axis) Total value
Note: (*) forecast 2012 analysed by Bloem Doze Nienhuis / Source: Camper & Nicholson, SuperYacht Times
70 BIRD’S-EYE VIEW Maritime Hotspot Shanghai
4.9. Knowledge exchange
MARIN and Technical University of Delft maintain relations with their Chinese counterparts. MARIN has a joint venture with SSSRI (Shanghai Shipping and Shipbuilding Research Institute). In this facility, the relatively simple tests are being carried out. Apart from this, MARIN has a research cooperation with Wuxi, close to Shanghai. This is the largest research institute in China, linked to the navy. These contacts go back to the 1970’s. The cooperation with China is not taken for granted, the problem being the leakage of knowhow. STC does not have a permanent presence in Shanghai. The business is done on a project basis. STC works together with Shanghai Maritime Politechnic (nautical education) and MTI (logistic trainings). Up till now money was always the problem, but this slowly begins to turn. The management of knowledge is probably one of the hardest problems for companies working in China. The general feeling is that we are giving a lot, but receive just little. The search for real synergies is ever going on.
4.10. Company experiences
Currently, a number of Dutch maritime companies are active in Shanghai and surrounding areas. Examples are: Alewijnse Marine Technology, Damen Shipyards, Dockwise, Econosto, IHC Merwede, MARIN, Panteia, Port of Rotterdam, STC, Wagenborg, and several smaller companies being active in the Holland Marine House China.
Shanghai is a sister city of Rotterdam and the Mayor of Rotterdam maintains frequent contacts with Shanghai. The relationship between Shanghai and Rotterdam is crucial: ‘if it goes well in China, it is going well here’. The excellent relations on municipality level are beneficial to the Port of Rotterdam and to companies located in the Rotterdam area. Strangely enough there is a triangular relation between Rotterdam, China and Russia. Russian oil will be collected in the new VOPAK terminal at Maasvlakte 2 and shipped in large crude carriers to China.
The Port of Rotterdam has a small office and the RCRO is present. At the moment, however, the Port of Rotterdam is busy with North China (Tianjin). They are building a new port (Nangang Port) which is ten times the size of Maasvlakte 2. The Port of Rotterdam is trying to get a port management agreement.
According to some respondents, China still has to work on their transparency. It is not always clear who is in charge. In political spheres, that will probably stay this way, until in October 2012 a new Chinese leader will be chosen. It is not certain what will happen to the investment climate in China after this election.
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Regarding investments in the port of Shanghai, there is an increasing role for private companies like COSCO, SIPG (Shanghai International Port Group; container terminals) and China Shipping. Contacts with government are still important, although the freedom for business is increasing. On the other hand, there is a growing nationalist tendency which is hard to assess in terms of future consequences.
Dutch offshore companies generally do not prioritize the Chinese oil and gas industry. The speed of decision making in major oil companies like for instance CNOOC, is relatively low. Low costs are leading in procurement strategies, instead of optimized quality. In a sense it is a protected market, but the major Dutch subcontractors might be used to gain a higher international standard.
The dependence on local parties can lead to delays. Ship to ship transfer is troublesome in the offshore sector, and clearance of project equipment can be time consuming. Apart from these small bureaucracy problems, there are no further complaints. This is also confirmed by a Dutch ship-owner building in Shanghai. The experiences of dredging contractors are limited, due to the closed nature of the Chinese market. There is no level playing field for Dutch dredging contractors.
One Dutch shipyard, who is active in the Chinese market, stresses the importance of good ship finance arrangements. Together with the Ministry of Foreign Affairs and Finance new ways should be sought to offer financing conditions. A further co- operation between Dutch shipyards and water engineers, could improve Dutch opportunities in China. The Dutch government could lobby more actively for Dutch projects. In other words, Dutch companies and diplomatic services could create a stronger block in the direction of Chinese clients.
Another Dutch shipyard notes that it is obligated that at least 75 per cent of the products are purchased from China, and it is not always clear what the Chinese do with knowledge gained through Dutch shipyards. This leads to careful behaviour, when investing in Chinese local presence. Under the new WTO-rules, the share of foreign investors in Chinese companies can be limited to 49 per cent which makes Dutch investors even more suspicious.
According to the interviewed Dutch companies, the diplomatic channels are to be further explored.
Different respondents indicate that it is not always easy to exchange personnel with China. For example, getting working permits for Chinese people that want to attend a course or training in the Netherlands is difficult to get. There should be better arrangements and strategy for Chinese engineers that want to work in the Netherlands.
72 BIRD’S-EYE VIEW Maritime Hotspot Shanghai
4.11. Conclusions and recommendations
The next graph shows our assessment of market opportunities. On a 1-to-10-scale we have attributed a score per sector. The Ports and terminals and inland navigation in Shanghai weigh heavily on the average. The dredging opportunities are very low due to the closed dredging market. Within the offshore market the Dutch respondents did not attach high value to the Chinese market. The average gives a value below 5.
Figure 4.4: Shanghai Market opportunity assessment Shanghai
10 9 8 7 6 5 4 3 2 Average 1 MarketOpportunity 0
Source: Analysed by Bloem Doze Nienhuis
Clearly the market opportunities for Dutch companies differ from sector to sector. Dredging companies, that cannot enter the market, show no real interest in Shanghai at the moment. The ports of Rotterdam and to a lesser extend Amsterdam see that quite differently. They attach great value to this major source of cargo. Offshore oil and gas is slow in all respects, with major oil companies like CNOOC’s decision makers and low cost policy. Dutch shipyards see possibilities, seek for new combinations and consortia, and they ask for new forms of project finance.
It is promising that the Shanghai authorities are working hard on their global competitiveness, including freedom of private enterprise. On the other hand, we see national content obligations increase, foreign ownership maximized at 49 per cent, problems with working permits for Chinese people.
At this moment there is no Dutch government program on Shanghai. The 2g@there program has been very useful, and now it is up to the companies to find their way.
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Recommendations:
1. Particularly in the field of shipbuilding, there is a need for state of the art export finance facilities and a level playing field
2. Dutch parties could work together better when operating in front of Chinese clients
3. The excellent relations of the city of Rotterdam could create new possibilities for the port related industries and other maritime companies
4. The infringement of intellectual property rights maintains to be a large problem. Constant support and attention is needed from all parties to contain this problem
5. Expand on activities that have been set up earlier, like the Yangtze forum on inland development, and clustering of logistic activities
6. Make better use of existing local structures, such as Holland Marine House China and RCRO. A further clustering of activities within the maritime house could benefit us all. Sharing of information is of great importance.
74 Bibliography
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Aa, Ruud van der, Bossche, Marten van den, Nuland, Etienne van, Schijndel, Marjan van, Vos, Onne, April 2011. De Nederlandse Maritieme Cluster Monitor 2011, Rotterdam APM Terminals, 09/10/2012. APM Terminals Invests in Russia, The Hague. Association of Singapore Marine Industries, 2012. Industry reports & Industry statistics. Boat International, mid-2012. Market intelligence about new orders super yachts. Booz&co, 2010. Competitive agenda for offshore oil and gas supply chain in Brazil. Boskalis, 2011. Press release 08/01/2011. Camper & Nicholson, July 2011. SuperYacht Times. Centre for Maritime Studies University of Turku and Baltic Ports Organization, September 2010. Baltic Port Barometer 2010 – Port development in the Baltic Sea Region. Views of the Baltic ports for the year 2011, Turku. Centre for Offshore Research and Engineering (CORE) website. China Briefing, 11/07/2011. Shanghai to Offer Incentives to Shipping-Related Industries. China Communications Construction Company, 06/13/2012. Liu Qitao meets with IHC President Hamers. China International Electronic Commerce Network website. Chinese Ministry of Transport, 08/14/2012. ‘Inland shipping investment up 33.1per cent to 21.1 bln yuan’ Chinese Research and Intelligence (CRI), 03/04/2012. Research report on Chinese Yacht Industry. Clarkson, 2012. World Fleet Register. Clarkson Capital Markets, May 2012. Overview of the Offshore Supply Vessel Industry. Companhia Vale do Rio Doce, company website. De Valios et al, October 2011. Short Sea Shipping in Brazil: Potential and Policy Implications, Santiago de Chile. Department of Statistics Singapore, 2012. Various graphs. Dredgingtoday.com, 09/10/2012. CCCC – Largest Chinese International Contractor for 6th Consecutive Year . Dredgingtoday.com, 10/01/2012. Singapore: PSA Launches Pasir Panjang Development Plan. Fialho, Fernanado Antonio Brito, October 2011. Port Opportunities in Brazil, Rio de Janeiro. Fialho, Fernanado Antonio Brito, November 2011. Priorities of Brazilian maritime transportation and policies for the new decade, Rio de Janeiro. Finpro St. Petersburg, 2011. North West Russia Sea Cluster Business Map, St. Petersburg. Galbraith, Andrew, 03/12/2012. China’s Shipbuilding Industry Shoots for the Stars…$189 Billion in Sales by 2015. Global Ports, 2011. Annual Report 2011, Russia. Gow, David, 02/03/2009. Wind power becomes Europe's fastest growing energy source.
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Guimarães, Paulo Ribeiro, January 2012. Potentials in Brazil Offshore within 2020 and How Norwegian Companies Can Be More Successful, Oslofjord Offshore Forum. Gurgel, Alexandre, 2011. The Retaking of the Shipbuilding Industry in Rio de Janeiro, Governo do Rio de Janeiro. Howell, David, May 2011. Brazil – Opportunities for UK-based companies in the ports sector, UK Trade & Investment, United Kingdom. INTSOK, Norwegian Oil and Gas Partners, June 2010. Shipyards in Brazil – Rev D. Jablonski, Silvio, July 2012. The Brazilian Oil & Gas Sector – Highlights and Opportunities, Cartagena. Jiang, Vivian, Guo, Jane, August 2009. Shaping up Shanghai. Lenta.ru, 11/09/2012. Press release: Russian government will spend 600 billion rubles on commercial shipbuilding. Lima, Tiago Pereira, May 2011. Regulation in the Brazilian Port sector, ANTAQ. Keppel Corporation company website. Koh, Quintella, 08/22/2012. Sembcorp, Keppel Could End 2012 with Over $16B Worth of Rig Orders. Marinov, Artiom, 2012. Analysis of the Russian shipbuilding market competitiveness, Erasmus University, Rotterdam. McKinnon, Alexander, June 2011. Hong Kong and Shanghai Ports: Challenges, Opportunities and Global Competitiveness, City University of Hong Kong. MENOM, 2012. The Leading Maritime Capitals of the World, Oslo. Ministery of Trade and Industry, 2012. Singapore. MPA Singapore, 2012. Port statistics. National Bureau of Statistics China, 2012. Various graphs. Norseng, Rune. Brazil Offshore Market – Opportunities and Challenges for Norwegian Suppliers, INTSOK, Norway. Port of Rotterdam Authority Port of Rotterdam Authority, 08/22/2012. Russia in WTO – opportunities for Rotterdam, Rotterdam. Reuters, 08/29/2011. China revises up 2015 renewable energy goals: report. Rosmorport, 2012. The development strategy of the sea port infrastructure in Russia to 2030. Sembcorp Marine company website. Shanghai International Port (Group) Co, 2011. Statistics. Shanghai Pilot Station. About Shanghai Port. Shavrov, Nikolay, May 2009. Russian Shipbuilding – Specialization & General Trends, INTSOK: Innovation Norway, Oslo. Shipbuilding Tribune.com, December 2012. Russia: Government OKs Construction of Shipbuilding Center on Kotlin Island. Sindicato Nacional da Indústria da Construção e Reparação Naval e Offshore (SINEVAL), September 2011. Brazilian shipbuilding and offshore industry: an overview, Mare Forum South America. Sindicato Nacional da Indústria da Construção e Reparação Naval e Offshore (SINEVAL), January 2012. Brazil – Offshore and Shipbuilding Industries Overview.
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78 List of contacted persons
List of contacted persons
Company Name
ABN AMRO Gust Biesbroeck
Allseas Engineering BV Hans Brans, Anne Bok, Matthijs Koop
APM Terminals Ben Vree
Bluewater Energy Services BV Clemens van der Nat
Damen Shipyards Gorinchem Pim Schuurman, Sylvia Boer
HMC Heerema Jan van Akkeren
IHC Merwede André Vrijsen, Philip de Bats, Hansen Hesen, Dick Knol, Fulco Vrooland
JR Shipping Jan Reier Arends
Keppel Verolme Harold Linssen
MARIN Bas Buchner
Ministry of Infrastructure and Environment Jan Peelen
Port of Amsterdam Wim Ruijgh
Port of Rotterdam Maurice Bosch, Kees Weststrate, Marc Evertse, Marc Aartsen
Spliethoff Erwin Meijnders
STC Group Albert Bos
TNO Marine and Offshore Jan Hoegee
Van Oord Dredging & Marine Contractors Bert Groothuizen, Peter Paul Hordijk
Wagenborg Albert Engelsman
79 Maritime Hotspots
80 Participants Maritime Hotspot Seminar
Participants Maritime Hotspot Seminar
Last name Initials First Name Organization
Buijs W. Willem Hatenboer-Water BV
Aalberts A. Adriaan TechForce Innovations BV
Aalst, van E. Ed ABN AMRO
Abreu, de C.F. Claudia Boskalis International BV
Adam K. Kristof W&O Supply Netherlands BV
Adimi-Koekkoek D.G.A.A. Djoeke Ministerie van EL&I (Buitenlandse Handel)
Anink D. David Scheepsbouw Nederland
Baank-ten Boer A. Annewieke Holland Marine Equipment BV
Baars J.P. Jan-Piet Vroon Offshore Services BV
Baart-Ritsma J. Johanna Holland Marine Equipment BV
Bakker-Mantjes M. Mieke Scheepsbouw Nederland
Bartels J.J. Joop Bartels International Shipping Company BV
Beelen K. Koen Co-Capacity BV
Bergonje TH. Theo Future Center RWS
Berting P. Peter Loggers BV
Blankenburgh J. A. Jari Verebus Engineering BV
Blankestijn T.P. Tom Peter Sea2Cradle
Bloem M.W. Martin Bloem Doze Nienhuis
Bodewes H. Herman Bodewes Shipyards
Boelema J.B. Jelte Wilhelmsen Ships Service BV
Boer A. Arie Bakker Sliedrecht Electro Industrie BV
Boer S.M. Sylvia Damen Shipyards Group
Boer, de A. Alexander Altus Holland BV
Bogaers A.C.J.M. Fons Central Industry Group NV
Bolhuis A. André Kwant Controls BV
Boogaerdt C. Cees Royal Boogaerdt Timber
Bos L. Lodewijk Fugro Engineers BV
81 Maritime Hotspots
Bosch M.R.J. Maurice Havenbedrijf Rotterdam NV
Bosch, van den R. Rik Wageningen UR
Bouckaert S. Steven Maritime & Transport Business Solutions (MTBS)
Bouman E.A. Eric MME Group
Bruin, de R. Robert Van Oord Dredging and Marine Contractors BV
Bus C. Chris Winel BV
Conyn F.G.M. Fritz Conyplex BV
Dam G. Geertje TTA World
Derksen Ch. Chris Hatenboer-Water BV
Domela J. Jelmer SAM Electronics Nederland BV
Donselaar, van I. Ivo Jansen Venneboer
Doornweerd G.G. Georgina Scheepsbouw Nederland
Doze H. Harry Bloem Doze Nienhuis
Dreschler V.A. Bram Cummins Holland BV
Eenhuizen J.H.E. Joost Havenbedrijf Rotterdam NV
Epema S.J. Seijo Damen Shipyards Gorinchem
Evenhuis M.K. Marcel Centraalstaal BV
Faasse P. Piet Croon Elektrotechniek BV
Faerber B. Brian Croon Elektrotechniek BV
Folkers L. Lukas Datema Delfzijl BV
Franken M. Martin Dutch Thruster Group Bv
Fredriksson A.G.S. Goran Marine Safety Consultancy
Genc R. Rabia Bloem Doze Nienhuis
Gennissen H. Henk Carlsen Group
Gerritse F. Frans Agentschap NL Innovatie Den Haag
Gilding E. Edward Kennisalliantie
Groeneveld D.H. Dirk InterDam BV
Grozdanoski M. Martin Amsterdam Research Project
Haarsma J.F.M. Hans Jansen Venneboer
Haegenbergh, van A.J.P. Anneke Alewijnse Marine Technology BV
Hamer, van den B. Bart W&O Supply Netherlands BV
82 Participants Maritime Hotspot Seminar
Hammen, van der E. Eric Hempel (The Netherlands) BV
Haneveer R.J.P. Ruud Auxilium Offshore BV
Hardie G. Graham The Offshore Partners
Heemskerk F. Frank Haskoning DHV
Hees, van M.A.W.M. Martien Rotterdam Mainport University
Heiligenberg, van den F. Frank GEA Westfalia Separator Nederland BV
Herwaarden, van B. Bert Van Herwaarden Energie en Techniek
Heutink A. Arne Holland Marine Equipment BV
Hietbrink E. Erik STC BV
Hobma W. Wendy Stichting Nederland Maritiem Land
Hoegee J.H. Jan TNO Maritime & Offshore
Hoesenie R.N. Roegzana Stichting Nederland Maritiem Land
Hoeven, van der M.S. Marco Cofely West Industrie, Marine & Offshore (E&I)
Hoffmans J. Jacques MasterShip Software BV
Hogewoning A. Albert Bayards Aluminium Constructies BV
Holman W. Wietse Koninklijke Niestern Sander BV
Houwelingen, van M. Marinus Bloem Doze Nienhuis
Jansen M. Maurice STC-Group
Jong, de D. Daan Voith Turbo BV
Joustra J.C. Jan Kees VCI
Kaminski M.L. Mirek TU Delft WBMT
Karman C. Chris IMARES (Den Helder)
Kingma R. Roelof Kingma Shiptrading
Kleijwegt C.J. Coert TurboNed Service BV klijnsoon A. Arjen IHC Offshore & Marine BV
Klok J.H. Erik Traduco Asset Management
Knukkel D. David DKTM Consultancy BV
Korteweg C. Corstiaan NEK Logistics
Kortsmit J.N.E.M. Jeroen Koninklijke Dirkzwager
Kraaijeveld A. Arie Stichting Nederland Maritiem Land
Krikke M. Marnix Scheepsbouw Nederland
83 Maritime Hotspots
Kruijsen C.H. Stijn Boskalis International BV
Kymmell J. Jelte KCI BV
Laarhoven, van K. Kees Ministerie van Infrastructuur en Milieu
Langereis D. Daniel S.G. ' Wiliam Froude'
Langstraat E Edwin Hoge School Rotterdam
Leijer, de H. Harrie Panteia
Leinenga R. Remko eL-Tec electrotechnologie
Liem R.T.T. Ruud IRO
Linssen H.W.M. Harold Keppel Verolme BV
Maasland R. Ruud Unisafe Marine Firefighting & Safety Equipment
Makkinga P. Pieter AEGIR Marine BV
Marel, van der L. Leo WRS Marine Inspections
Mars R. Rob M3 Management & Consultancy Pte Ltd
Martens R.J.J. Roel Ministerie van Buitenlandse Handel en OS
Menist M. Menno Panteia
Meun-Visser S. Stefan Marble Automation BV
Mol C.A. Dennis Imtech Marine Netherlands BV
Nagelmaker L. Louis KCI BV
Oortwijn H. Hilco Econosto Nederland BV Maritiem
Ort J.S. Bas Zwartbol Advocaten
Overing J.A.H. Jeroen Santt BV
Peelen J. Jan Ministerie van Infrastructuur en Milieu
Peters R. Renske Ministerie van Infrastructuur en Milieu
Pompe S. Stefan Trinitas
Rensma M. Marco MEYS Emerging Markets Research
Roerade M.C. Michaël Holland Marine Equipment BV
Roos L. Leo Fugro Engineers BV
Rooswinkel J. Jan IHC Hytop Shanghai Co. Ltd
Roozendaal, van H.P. Han Onderwijs centrum Binnenvaart
Roskam P. Piet Marble Automation BV
Rosmolen M. Martin Doedijns Hydraulics
84 Participants Maritime Hotspot Seminar
Ruysch W.H.A. Willem Hendrik Ruysch Technical Agencies Holland BV
Schoen R.J.A. Rutger-Jan SPAN
Schoof S. Sandra Ministerie van Infrastructuur en Milieu
Schouten G.M. Geert Shipbuilder Software
Schuur S. Siebe Agentschap NL, NL EVD Internationaal
Seijkens M. Maurice Imtech Marine Netherlands BV
Sickler M. Maarten Vuyk Engineering Groningen BV
Siliakus R. Raymond Ahoy Rotterdam NV
Silvis L.G. Lennart Netherlands Water Partnership
Slagmolen P. Pedro W&O Supply Netherlands BV
Slingerland C.T. Kees Wageningen UR
Smit R.H. Reint Ankerbeer BV
Snoo, de A. Alize Kamer van Koophandel Rotterdam
Spaans E.G. Eric Ministerie van Infrastructuur en Milieu
Spekman G.C. Gerrit Van der Velden Marine Systems
Spoormaker G.J. Gert-Jan Rubber Design BV
Staub L. Luc Bosch Rexroth BV
Syropoulos C. Christina Holland Marine Equipment BV
Terwisga, van P.F. Peter Damen Shipyards Gorinchem
Tiebout H. Han GustoMSC BV
Timmers P. Pieter Scheuder & Co
Tuijl, van I.J.K. Izabella Damen Shipyards Gorinchem
Uytendaal A. Arjen Stichting Nederland Maritiem Land
Varik, van V. Vincent Hatenboer-Water BV
Veen D. Dan TNO Maritime & Offshore
Veldhuizen TJ.A Tjeerd Trinitas
Velzen, van T.F. Terry Imtech Marine Netherlands BV
Venteville J. Jurgen ESTechnologies BV
Vink A.A.N. André HISWA Vereniging
Vis, van der J. Jacob Kamer van Koophandel Rotterdam
Visser R. Ron Verebus Engineering BV
85 Maritime Hotspots
Vliet, van N. Nicole Royal Boskalis Westminster NV
Vogelzang H. Hans Shipkits BV
Vonderen-Pols, van E.G. Els Holland Marine Equipment BV
Vos E. Edy Dutch Thruster Group
Vugt, van H. Harold W&O Supply Netherlands BV
Wagelaar J. Johan Bloem Doze Nienhuis
Wal, van der S. Sander Kennisalliantie
Wanders R.G.H. Ruud eL-Tec electrotechnologie
Werf, van der H.D. Haijo Offshore Ship Designers BV
Wiersma A. Anne Nieland BV
Wijnberg J.A. Arjan Discom BV
Wijsmuller M.A. Michiel Offshore Ship Designers BV
Wilhelm M.L. Michiel Veranderingsfabriek
Winters F. Frank Agentschap NL, NL EVD Internationaal
Wolthuizen R. Rob Shipdock BV
Wouterse T. Ton RaboBank
Wubbolts S. Sander STC-Group
Yong S. Sec-Ching Amsterdam Research Project
Zijll Langhout, van C. Coert Navingo BV
Zwaluw, van der M.O. Marc Offshore Ship Designers BV
86