SA ship register 'uncompetitive'

This has left the country - which relies each year on about 12,000 foreign vessels to carry 96% of its exports to the rest of the world - strategically vulnerable, it says in its 2012/13 annual report.

"This means that South Africa's economy and its security of trade are dependent on ships owned and regulated in foreign countries."

Ship ownership was of strategic importance to any maritime state, "hence the rush by many to attract merchant ships to register on their national ship registers".

However, while South Africa had one of the oldest ship registers in the world, it did not have a single merchant ship listed on it.

"That is not because there is no South African company that owns such ships, but those shipping companies have opted to flag their ships in foreign jurisdictions due to the fact that the SA Ship Register is considered uncompetitive," said Samsa

The reports says shipping "has become a global activity", with ship owners free to flag their vessels in states different to their own.

"Today, shipping owners decide where to locate their ships on the strength and attractiveness of national ship registers, a business decision influenced by factors such as the attractiveness of a ship registry's taxation and broader legal regime," the report said.

Report details problems

The report, tabled in Parliament, says the lack of an own-flagged merchant fleet has cost South Africa dearly.

"The ability of South Africa to carry its own import and export trade has been in catastrophic decline since the early 1990s. This has inopportunely occurred during one of the fastest growth periods in international trade volumes experienced by South Africa," it said.

The lack of a competitive register had led to a significant loss of critical public and private sector maritime expertise; a commercial maritime services competence; industrial capacity; the capacity to undertake marine research; [and], development and innovation that a country accrues from owning and operating an indigenous merchant shipping industry.

The report further notes that if its vast territorial water and economic exclusion zone was taken into account, South Africa was the "largest" country in Africa.

"It has the immense and untapped potential of becoming a major maritime nation," the report claimed

The report says a "more friendly" ship register is only one part of a package of legislative changes, regulations and concessions needed to make flagging in South Africa attractive to ship owners and charterers of bare boats.

It goes on to say that the prospects for successfully introducing all the measures in such a package depend upon government policy.

Samsa is a statutory body tasked with promoting South Africa's maritime interests while ensuring maritime safety, health and environmental protection. It administers the SA Ship Register.

Source: Sapa via I-Net Bridge