The City of London Corporation has published its research findings that UK tops the list for its varied services in Maritime Business that includes marine insurance, shipbroking, legal services and education. The UK maritime trade promotion body Maritime London lauded the city corporation for its findings on the leading maritime business services hub. According to the reports, they contribute £4.4bn to the economy and employ over 10,000 people. Nearly 80-85% of UK’s business comes from outside.
PricewaterhouseCoopers (PwC) produced a statistical report titled ‘The UK’s Global Maritime Professional Services: Contribution and Trends report’. The report states that UK has:
- A 35% share of global marine insurance premiums
- A 26% of global shipbroking revenue
- A 25% of the world’s maritime legal partners are based in the UK.
Some of the Key Findings of the reports are:
- 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 obtaining 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.
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.”
Source: City of London