European shipping industry in the doldrums; EU backs state aid calls

NAPLES (AFP) – Competition, economic recession and terrorism have mined the waters of Europe’s shipping industry, causing captains to send SOS signals to EU leaders. «European shipyards have reached the survival limit in terms of prices,» Dutch representative Sjef van Dooremalen warned Tuesday as he co-presided at an annual forum of shippers in Naples. «I do not rule out bad news in the coming months, in terms of shutdowns and firings.» His counterpart and forum host, Naples shipowner Emmanuele Grimaldi, said, «The key to success of European maritime industries is sustainable investment.» The European fleet represents 41 percent of the world’s merchant marine, 111 billion euros in added value and jobs for 2.4 million people. «The decline of European maritime transport has been halted despite economic stagnation, and successes have been recorded in the short-sea shipping sector, the seaborne highways in which market share has risen in 20 years from 37 to 43 percent,» Grimaldi stressed. Much nonetheless remains to be done, and Europe has not met the sector’s expectations, players told European Transport Commissioner Loyola de Palacio, who was invited to the forum. On October 22, the EU filed a complaint against South Korean shipbuilding practices with the World Trade Organization, arguing that builders sell ships below cost because of government subsidies. In June, EU Trade Commissioner Pascal Lamy estimated that South Korean firms, which include the world’s largest, Hyundai Heavy Industries, were offering ships at between 10 and 15 percent below actual cost. But European shippers also criticize different levels of port taxes within the European Union and varying amounts of national aid available to builders. Problems posed by terrorism have also divided European maritime operators. The United States considers cargo arriving in US ports – around 16 million shipping containers per year – as a potential risk since it could contain weapons of mass destruction. US customs services have singled out around 20 major ports that ship to the United States, and Washington is negotiating separate cooperation accords with the host countries, including many EU members. Agreements have been reached with Belgium, France, Germany and the Netherlands, while others are being discussed with Britain, Greece, Italy, and Spain. Shippers have been asked to identify and provide the contents of containers 24 hours before they are loaded onto US-bound ships, and cooperating companies are offered accelerated processing upon arrival. De Palacio denounced the bilateral accords, saying they «create distortions between European ports and operators.» The issue is to be at the center of November 4 talks in Brussels with US Homeland Security Adviser Tom Ridge. De Palacio surprised European shippers by backing the idea of increased aid for naval construction. «Decision makers must be convinced that naval construction deserves the same support provided to strategic sectors, as is the case in the United States,» she said.