Shipping Is A Necessity Regardless Of Crisis

I’ve laid out the argument consistently in previous columns why the maritime sector should be a key candidate for any long-term investment plan.
01 Jul 2020 15:00
Shipping Is A Necessity Regardless Of Crisis

Last week I was taken by two media reports. In the global press I read that the national shipping sector was celebrating a donation by industry leaders of $US60m to opening a Centre of Excellence to place Denmark as a global leader in new zero-emission shipping. Sustainable employment for over 100 highly qualified researchers bringing together science, business, industry and government to strategically reposition a major global industry.

The other event was our own national budget consultation, being led from the front by the Attorney General, Minister of Trade and Secretaries of Health and Economy. It was a sobering presentation. Fiji, as with all our Pacific neighbours, now faces a Herculean challenge. How to restart and rebuild our fragile economies now ravaged in a post-COVID-19 climate crisis world. While the first emphasis is on simply surviving the shock of having the cornerstones of what was a very positive long-term growth curve comprehensively destroyed, the discussion is also focussed on how to best to reinvest for the future.

I’ve laid out the argument consistently in previous columns why the maritime sector should be a key candidate for any long-term investment plan. Economic recovery through, and following, the pandemic is going to be ever more closely linked to getting our domestic economy moving in a safe manner and expanding a ‘Bula trading bubble’ with our regional neighbours.

Regardless of the crisis facing us – health, natural disaster, climate – or whatever else the big wide world is throwing at us, our island countries must have shipping. The quality of that shipping, and the degree to which we remain dependant on the outside world to deliver us our solutions, is largely a strategic choice Pacific governments need to make now. The ‘old normal’ was a decades-old, vicious cycle of fossil-fuel heavy, old or donated ships. But is the vision of a revitalised Pacific maritime industry a real possibility? Or is it just too much to expect of our small island capacities?

In 2016 Australia announced a $2 billion package to replace the aging Pacific-class Patrol Boat fleet. Of this, $700 million was to build 21 small ships – the new Pacific Guardian Class. The other $1.4 billion was for training, fuel and maintenance of the vessels over their lifetime. The first of Fiji’s vessels, the RFNS Savenaca, arrived last month.

Such aid is, of course, welcomed and needed. This fleet of patrol vessels greatly increases the Pacific’s capacity to protect its borders, police its fisheries and assist in disaster and emergency events. But did we miss an opportunity to build a sustainable maritime support industry inside the region?

Of course, one reason for our Australian cousins offering this particular package was in self-interest. Australian has been successfully building a leading naval construction industry for some time and they were between contracts. But initially there was no local interest when the Australian government tendered for the Pacific Guardian class fleet. Australian yards are fully geared to building high-end naval warships and support componentry – submarines, frigates, littoral support vessels. But what if this bilateral aid package had been integrated into a programme to revitalise and rebuild a Pacific-based sustainable industry in the Pacific? An initial contract worth over $1 billion to build and maintain 21 blue-water ships would not be unattractive to the Pacific’s investment community, including the major development banks.

Of course, we would have needed to build an entire programme of capacity development and training around this, but how many long-term, professional career paths could we have created – shipwrights, welders, fabricators, marine engineers and electricians, naval architects? What would have been the downstream spin-offs to numerous small scale industries – from paint manufacturers and suppliers to maritime surveyors to the café owners and kava sellers of Walu Bay and Lautoka?

Would it really have been beyond our capacity as a small island economy to have risen to this challenge? Or was it simply that we weren’t adequately prepared? After all, these are not overly complex vessels. The armaments aside, all the componentry from the motors to the bridge electronics are available off-the-shelf from multiple international suppliers. Even if we couldn’t build the hulls, surely we could have taken on some of the fitting out?

Could we have attracted partnerships, for example with the newly opened and cashed up Maersk Mc-Kinney Møller Center for Zero Carbon Shipping, to train a new generation of Pacific boatbuilders? Regardless of pandemics, cyclones and climate, the Pacific will need to replace hundreds of small ships in the next 30 years. They are as much a basic requirement of island life as food water and shelter.

We missed the boat with the Pacific Guardian programme. Will we miss the next one? The Pacific Blue Shipping Partnership is an investment blueprint to support a paradigm shift for exactly this purpose. We have a wealth of technical and knowledge partners waiting to support us around the world, in governments, industry, agencies and leading universities. Is this an opportunity and a pathway we can afford not to take?

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