A lesson for SA from Oz over ship registry aspirations?

South Africa is not alone in its aspirations to become one of the world’s top 35 maritime nations (FTW January 10/17 “Government is chasing a rainbow”). Australia has the same thing in mind – but its intention was to increase the number of Australian ships carrying Australian cargoes – with a particular eye on the huge number of bulk carriers hauling mineral raw materials out of that country. And, according to Andrew Robinson, director of Norton Rose Fulbright (NRF), the same motivation exists here in SA – with the government focusing on the massive tonnages of coal and iron ore exported from Richards Bay and Saldanha Bay respectively. “Business Monitor International (BMI) set out the following tonnages (excluding TEUs) from these two ports,” he said, “showing that Richards Bay in 2013 shipped 96 882 000 tonnes of coal, while Saldanha Bay exported 62 323 000 tonnes of iron ore. “So you can see why government sees these tonnages as being attractive. “But BMI also sounded a note of doom, pointing out that none of the main liner operators (moving containers in the main) indicated that the new tax regime would entice them to the SA ship’s register.” In the Australian scene, the government announced on September 9, 2011 a package of reforms to revitalise the Australian shipping industry and make it more internationally competitive. That country has tweaked all the allowances it could to make the registers attractive, including more tax exemptions and allowances than SA is proposing. The reforms also implemented a more open and transparent system of cabotage set out in legislation. The new licensing regime involved the implementation of a three-tier licensing regime, namely: a General Licence; a Temporary Licence; and an Emergency Licence. These reforms were implemented in July 2012. “But,” Robinson said, “I have been advised by our Australian Norton Rose Fulbright counterparts that, despite the incentives, there are no ships registered on its International Registry. “Why should the SA experience be any different? Apart from the new tax exemptions, there is little to attract any potential customers. There is also little to encourage banks or, as is currently the case, other private equity interests, to invest in ships. “I would love SA to have a thriving registry, but it seems an unlikely project – and time, effort, energy and money should really be spent on other things.” INSERT & CAPTION I would love SA to have a thriving registry, but it seems an unlikely project. – Andrew Robinson