Speech: How international trade levels-up the world
Maritime UK Chair, Sarah Kenny OBE, delivered the following remarks to the North East Chamber of Commerce International Trade Summit on 20 October 2022.
Good afternoon, ladies, and gentlemen. I’m delighted to be here today and be joining such an esteemed panel.
Thank you to the North East Chamber of Commerce for delivering today’s session. Bringing together a fantastic cohort of companies and partners to discuss a topic of vital importance to the region and our country – the bedrock of prosperity – international trade.
In recent years we have seen international trade back on the agenda. Whether that’s in terms of post-Brexit trade agreements, how trade can help drive economic growth through freeports, or a recognition of the very real fact that we’re an island nation and our prosperity flows from our engagement with the rest of the world.
Trade and maritime are synonymous. Perhaps the most global of sectors, maritime is the fundamental enabler of trade across the world. Connecting people, ensuring resilience and spreading wealth.
Moving some 90% of all goods globally, that rises to 95% here in UK.
Without maritime transport, half the world would freeze, and half the world would starve.
Some 11 billion tons of goods are transported by ship each year. This represents an impressive 1.5 tons per person based on the current global population.
Our capacity to transfer goods and materials from where they are produced to where they will be ultimately consumed underpins modern life.
Latest figures show the total value of the annual world shipping trade had reached more than 14 trillion US Dollars.
Each year, maritime moves nearly 2 billion tons of crude oil, 1 billion tons of iron ore - the raw material needed to create steel - and 350 million tons of grain. These shipments would not be possible by road, rail, or air.
Such raw materials allow countries to create industries, construct cities, house and move populations, and transform resources into refined products for re-export. This ability to add value drives prosperity and enables developing countries to grow.
Large volumes of other key products such as chemicals, refined fuels and manufactured goods are also shipped by sea.
To support world economies, highly sophisticated logistics chains deliver just-in-time parts and goods to manufacturers and consumers. Avocados, for example, are shipped from Chile to arrive in Europe just as they ripen.
Maritime trade allows countries to access the raw materials needed to develop their economies.
We enable the manufacture and export of affordable goods and products, driving down prices.
And we have the lowest environmental footprint of transport modes on a per-ton basis.
Whilst maritime and free trade are key agents of global levelling-up, it has also been recognised as a key sector within the domestic sphere.
In freeports, the government has recognised the role that ports, and the wider maritime sector can play in driving investment and catalysing growth in coastal areas. Teesside Freeport is at the front of the pack in delivering on that ambition, has already attracted hundreds of millions of inward investment and is establishing itself as a global centre for innovation and manufacturing.
A massive boost for the region, and I know that there is huge appetite in further Investment Zones across the region. A region in which maritime plays a major role.
In the North East, maritime, encompassing shipping, ports, marine engineering, professional services and leisure marine is big business. Facilitating trade, yes, but also exporting our own innovative products and services.
Taken together, that’s:
£1.4bn turnover from the North East’s maritime industries
Adding £583m in GVA
Supporting 9,000 jobs in the region – just under 7% of the total
that are 45% more productive than the national average
Maritime has been at the heart of this region’s history, it’s in its DNA.
It can also be an enabler of its future growth.
To do that, we need to have the right business environment, and, most importantly, have the products and services that the rest of the world wants and needs.
The Mauritania was once known as the fastest in the world and loved by her passengers. Built right here in the North East by Swan Hunter.
She captured the eastbound Blue Riband on her maiden return voyage in December 1907, then claimed the westbound Blue Riband for the fastest transatlantic crossing during her 1909 season and held the record for 20 years.
To be the fastest in the world, beating every other ship, engineers and naval architects pushed the boundaries of technology and applied innovation to be the best.
You can change the era, you can change the materials, and you can change the shape of the global economy, but one thing remains constant.
That to win, to grow and to lead, we must innovate.
And in the third decade of the twenty-first century, I believe that to compete and win globally, businesses must collaborate.
We’re seeing more and more collaboration in maritime – and more success as a result. We innovate better solutions than we can alone, and we’re able to compete in the global market. That’s just as true for other parts of the economy as it is for maritime.
As a country, it’s vital that we think long-term, and have a shared heading for industry, government and academia to work together towards. I’m pleased that in maritime, we have that famework and guide in the form of Maritime 2050.
A joint industry-government strategy to ensure that we’re the most competitive maritime nation globally by 2050.
To complete and win internationally, that shared heading is critical. It’s not always easy to find the common ground between competing businesses – but for UK PLC to win and to export, it’s fundamental.
And for maritime, it’s working.
We’ve worked together to deliver:
The establishment of the UK Shipping Office for Reducing Emissions,
The launch of the new National Shipbuilding Strategy,
The £206m Clean Maritime Demonstration Competition,
The Clydebank Declaration at COP26,
Reforms to the UK’s Tonnage Tax regime,
An uplift in government funding for cadet training.
And, particularly close to my heart, the UK is now ranked the world’s number one globally for blue technology.
All of this makes us a more attractive location for inward investment and our products and services are in greater demand internationally. And the North East stands to benefit.
As one of the primary sectors within the government’s ten-point plan for a green industrial revolution, we want to lead the world in developing, deploying, and exporting green maritime technologies. Just as the UK fights for international regulation for this most international of sectors.
The government has provided a very welcome start here, but to reach our climate targets, this needs to scale up.
We can scale up the £600m of private investment ports make in their communities each year, by building upon the freeports programme and making targeted pro-investment reforms to the business environment.
And in an increasingly competitive global maritime environment, we want the government to take forward our recommendations to enhance the UK’s pre-eminent position as the world’s global maritime services capital.
We must also speed up delivery of the fantastic National Shipbuilding Strategy to ensure the UK’s position as a world-leader in high-value shipbuilding, marine manufacturing, design, and technology.
And as the industry is making great progress to attract talent to our sector. We want government to review the apprenticeship levy and get more maritime qualifications approved.
Taken together, these represent a plan to grow one of the UK’s most productive sectors and boost the country’s competitiveness.
We are ready to work with the government to make that happen.
Trading relationships can help bind countries and their peoples. And that’s needed now more than ever. One example of where we’re doing so in maritime is in response to the Clydebank Declaration, signed at COP26 in Glasgow last year.
International commitment to introduce green shipping corridors that are designed to help accelerate the sector’s decarbonisation. They will so by focusing on specific shipping routes between two countries. We can marry the propulsion solution with the shoreside infrastructure and spread that learning as technologies mature. Greening trade and developing markets for UK products and services.
I’m pleased that in the latest round of the government’s Clean Maritime Demonstration Competition, the Clean Tyne Shipping Corridor Consortium was announced as a winner. The North East is well and truly on the national and international stage.
Ladies and gentlemen, international trade is the great global leveller and has helped lift millions out of poverty through exports and inward investment.
We are a global community facing the same shared challenges.
As an island nation, the UK’s future is inextricably tied to its trading success and the maritime sector is fundamental to that.
By making our business environment attractive, and by developing the products and services that the world wants, we can all grow our exports and inward investment.
Maritime will forever be at the heart of international trade, and the North East is renewing its role as a global maritime player.
Maritime UK looks forward to working with all partners to grow our success as a global trading nation.
I look forward to the discussion!