By Jonathan Saul
LONDON, Sept 9 (Reuters) - Britain's position as a top hub
for maritime services is being eroded by competition, a loss of
shipping finance business and the removal of tycoon-friendly tax
breaks, a report said, deepening uncertainty for its financial
sector as Brexit nears.
The UK has been a pivotal global shipping centre for
centuries, especially the City of London, and has dominated
marine insurance, ship broking, shipping finance and other
maritime services.
These contribute $5.6 billion a year to Britain’s economy,
providing employment for more than 10,000 people in highly
skilled jobs, according to a report by consultancy PwC,
commissioned by trade association Maritime London.
But a shift in global shipping trade to Asia and tougher
competition are adding to pressures on this niche sector, the
report said.
"We estimate that if the UK had maintained its market share
over the last two years, this would have resulted in an
additional $700 million p.a. (annually) in GVA (gross value
added) for the UK economy," said the report, published in
partnership with the City of London Corporation.
The global maritime services market is estimated to be worth
$20 billion annually.
"Significant ground has been lost to international
competitors in recent years. Competitors such as the U.S.,
China, Norway and particularly Singapore, are all challenging in
key areas of development and we must react," said Harry
Theochari, chair of the separate Maritime UK body.
The report, launched at the start of London International
Shipping Week, comes as Britain spins towards an election.
Brexit remains up in the air, more than three years after
Britons voted to leave the European Union. Options range from a
turbulent "no-deal" exit to abandoning the whole endeavour.
The report's authors said their interviews with maritime
services professionals "offered mixed views on the impact of
Brexit on the UK’s perception as a politically stable country".
"Some pointed to opportunities to reduce regulation
post-Brexit, while others expressed concerns about the
availability of talent and the perception of the UK as ‘open for
business’,” the report said.
The exodus from shipping finance by many leading lenders
including Britain's Royal Bank of Scotland and Lloyds
had affected London's position as a money destination
for international shipping firms, the report said.
Separately, Britain's decision to scrap tax breaks for
long-term residents who claim "non-domicile" status led to the
departure of prominent Greek players from London in recent
years.
"The UK needs to be more active in courting ship owners and
other industry participants to come here," the report said.
"It is also vital that post-Brexit, the UK remains open and
welcoming to foreign talent."
The report said the UK maintained 25% of the maritime
services market. It recommended more efforts to bring dual
listings to the London Stock Exchange to boost capital markets
activity for shipping as well as taking a lead in developing
environmental finance products, while providing tax incentives.
"What’s critical is that we work to strengthen the core of
ship owners and charterers in the UK, which will provide a
significant boost to the UK economy," Maritime UK's Theochari
said.
(Reporting by Jonathan Saul; Editing by Dale Hudson)
Lloyds (LLOY)
