Canada seeks to revitalise yards

Key organisations within the shipping and shipbuilding industries in Canada have banded together to produce what they have called a Joint Strategy Paper the aim of which is the revitalisation of the shipbuilding industry in Canada. The alliance of shipyard executives and union leaders also included the Shipbuilding Association of Canada.

The paper highlights the fact that almost all shipbuilding nations subsidise their yards in some form or other – claiming that subsidies in Asian yards can be in the order of 30 per cent – and draws attention the importance of the Title XI Loan Guarantee scheme in the US.

Noting that labour costs in Canada are lower than in the US, Germany and Japan, the Canadian strategy paper calls for the Canadian government to implement a loan guarantee scheme similar to Title XI. It also calls for new vessels built in Canada to be excluded from existing Revenue Canada Leasing regulations, and suggests that a refundable tax credit be made available to Canadian owners who have their ships built or repaired in Canadian yards.

The paper also proposes ending elements of the North American Free Trade Agreement (NAFTA) that allows the US to sell newbuildings or second-hand vessels duty free in Canada, whilst prohibiting Canadian access to the US market.