UK maritime trade promotion body Maritime London has welcomed the findings of research published today by the City of London Corporation which show that the UK is the world’s leading maritime business services hub. According to the report, UK based companies offering marine insurance, shipbroking, legal services and education contribute £4.4bn to the economy and employ over 10, 000 people. An estimated 80-85% of its business comes from outside the UK.
The UK’s Global Maritime Professional Services: Contribution and Trends report, produced by PricewaterhouseCoopers (PwC), finds that the UK has a 35% share of global marine insurance premiums; 26% of global shipbroking revenue and that 25% of the world’s maritime legal partners are based in the UK. The report outlines the UK maritime clusters strengths and threats that it faces to its pre-eminent position.
Welcoming the report’s findings, Maritime London Vice-Chairman and Partner at Norton Rose Fulbright, Harry Theochari said: “With a history of more than three centuries in maritime business services, we at Maritime London are not surprised to see that the UK remains the undisputed global leader in this sector and we are well aware of the huge contribution that maritime business services make to the economy of the UK. The [Maritime Report] re-enforces the findings of the recently published Mountevans Report and, again, highlights the importance of implementing the recommendations outlined in the Mountevans Report. With the maritime industries facing the worst recessions in living memory, this is a pivotal time for everyone involved in the maritime industry and it is clear that the United Kingdom and the City of London, through their maritime professional services capability, are exceptionally well placed to assist and serve the maritime industry through these very challenging economic times and to continue to build on the excellence and expertise that has been developed over such a long period of time.”
Maritime London Chief Executive Doug Barrow said: “Maritime London is delighted to be associated with this report that has been commissioned by the City of London. Again, it demonstrates the impact of maritime services to the UK’s economy and to the City. We would like to thank the many companies that have contributed data to enable the authors to produce such an informed report. The long awaited report now provides us with evidence in support of our promotional efforts clearly demonstrating the importance of our maritime services. This report states where we are today and gives some pointers for the future. Our job now is to support the growth of our maritime services and ensure they have an increasing share of global business.”
Key report findings
• The UK is headquarters for many of the world’s leading maritime law and shipbroking firms. Many of these companies have expanded with new offices across the globe, while the UK is the destination of choice for complex risk insurance, backed up by the expertise of Lloyd’s of London and the International Underwriting Association.
• The cluster effect whereby the above services have a multiplying effect, helping bring in business for each other and attract talent. Customers highly value being able to access all these services in one place.
• The depth and scale of the UK’s talent pool remains unrivalled in comparison to other leading maritime centres such as Hong Kong, Singapore and Shanghai.
• The UK’s stable business environment, Rule of Law, geography, time zone and the attractiveness of London as a place to work and live were all cited as benefits.
However, the sector faces a number of threats to its preeminent position including:
• For many years, the UK has not been considered a major area of shipping activity due to its lack of established major hub port and limited local ownership and shipping activity when compared to the likes of Rotterdam, Hamburg or Shanghai. However, this disadvantage is not new.
• Corporation tax set at a higher rate in comparison to other hubs, problems attaining visas and ‘gold-plated’ regulation were all cited.
• The relative cost of doing business in London. The capital is the 4th most expensive city to rent high-rise offices, while average salaries (£870 per week) are far higher than those in the likes of Shanghai (£200) and Singapore (£450). It is therefore most feasible for high added value businesses to be located here.
• Other maritime hubs competing hard. Singapore has introduced tax incentives for ship operators and services, offered incentives for specific institutions to relocate and is now the second largest maritime services hub after London. Shanghai also has a greater focus on operations in the hope that services will follow, while Hong Kong has created a new promotional body to recommend ways to help grow the sector.
See http://bit.ly/1MMz9TV to download a full copy of the report
About Maritime London
Maritime London is the promotional body for UK-based companies providing professional services to the international shipping industry. Funded by over 100 companies and organisations from a wide range of disciplines, Maritime London ensures that the UK remains a world-beating location to base a maritime related business and to conduct maritime trade. Membership of Maritime London is open to any company that is able to demonstrate support for the UK’s maritime services sector on a global basis.