Summary
SUMMARY
Volume 25 - European Maritime Clusters
In this book the central question is: What determines the dynamics of maritime clusters and their long-term viability, and how may policy measures contribute to the strengthening of the clusters? The theory of clusters is put into perspective, on the basis of an understanding of the long-term development of the global shipping and shipbuilding sectors, as well as the insights derived from in-depth studies of two prominent maritime clusters in Europe: Norway and the Netherlands. Ships carry the majority of commodities that are traded in international markets. For this reason, the development of the shipping industry is closely related to the development of the world economy. Chapter 1 on Shipping in the global economy presents a broad picture of this relationship, starting with a discussion on the fundamental forces behind international trade and economic growth, and continuing with an empirical overview of the global economic development in the second half of the previous century. It is shown how growth in various shipping market segments follows long-term trends that are consistent with economic theory. The most characteristic feature is the rapid economic growth in Asia. It is argued that the ongoing growth process is likely to shift the point of gravity of shipping in the global economy, even further towards Asia, away from North America and Europe, in the years to come. This implies new opportunities for shipping in terms of growing markets, but it also implies a challenge in terms of how to expand and strengthen the existing maritime clusters in Europe. Maritime clusters grow and may prosper for centuries, but this does not protect them from decline. This is illustrated in Chapter 2, The Rise and Fall of Maritime Nations, on the basis of the growth and decline of the shipbuilding and shipping sectors in the maritime nations of the world. Globalisation of the economy has resulted in fierce competition from new entrants, mostly in Asia, to the detriment of the traditional shipbuilding and shipping nations. In 2003 these global forces are still at work and this threatens today the very viability of the shipbuilding sector in Europe. Also, in shipping, traditional maritime countries have been surpassed by new entrants. The creation of a level playing field in Europe for the shipowners, has halted the further decline in market share. European shipowners now control under the European flags and other open registries, some 40 percent of the world fleet. Given the importance of shipping for seaborne and world trade, and consequently for European exports and imports, strong and viable shipping and shipbuilding sectors are essential for the future of the European economy. Understanding the forces that cause the rise and fall of maritime nations, and maritime clusters, may provide the clues on which new policies may be formulated to maintain clusters viable. The structure and economic significance of the European Maritime Clusters cannot be easily determined on the basis of statistical sources in the individual countries, nor at the European level. Defining the cluster and its economic parameters in each country
European Maritime Clusters
is already a major task. Without this detailed insight it is difficult, if not impossible, to understand the dynamics of the maritime clusters and to assess their long-term viability. For this reason the European Commission commissioned a study in order to establish a basic insight into the size and structure of the European Union maritime cluster, including Norway. The results of this study, which are summarised in Chapter 3, confirm that the European maritime cluster is large and that its value creation is substantial. There are important differences among the individual countries, but considering the European perspective, the aggregate figures add up to a level which makes the cluster into a major contributor of the Gross European Product. These results provide the rationale for the European Commission to be actively involved in the policymaking of the European Maritime Clusters. The relative strength of national industries has been the subject of study for many decades. The search of academics to find the miracle cure to enhance competitiveness of industries got a strong impetus from the work of Michael Porter, in particular Competitive Advantage of Nations, in 1990. Many other academics have contributed to the understanding of Business clusters, Innovation and Value Creation, as Chapter 4 highlights. The theoretical basis of business clusters is an essential ingredient for the formulation of national and European policies which stimulate the dynamics and keep the clusters, in particular the maritime clusters, viable. The abundant research and insights that are available on clusters prove that cluster-based policies can work. However, it is not always easy to translate academic insights into real world policy measures. The reason for this is that the government has to adopt a cluster view as well, which requires an organisation and co-operation across several ministries. These vertically departmentalised institutions are sometimes difficult to align behind a common approach. Clustering at the governmental level should therefore be high on the agenda. The European Commission could stimulate such a change in attitude in the individual countries. Measuring the cluster strength and comparing clusters of different make-up, is the subject of Chapter 5, Benchmarking and Maritime Cluster Evaluation. The benchmarking methodology has been developed for individual companies, but its application on entire sectors of industry, let alone on complete business clusters, is a recent application and development. Therefore, the theoretical basis has to be developed and this study intends to contribute to that academic objective. A benchmarking exercise starts with the definition of performance indicators and the measurement of these variables. What are the performance indicators for maritime clusters? The study discusses the existing methodologies and the problems associated with the application of the theoretical methodology to the real world. Several casestudies are presented, also from a EU perspective, as the European Commission has actively stimulated benchmarking projects in the maritime industry, such as in shipbuilding and marine equipment, but also on innovativeness. The study identifies a number of performance indicators which are relevant for maritime clusters. These form the foundation for the definition of the Enablers of Maritime Cluster Dynamics, as presented in Chapter 8. Before this theoretical
Summary
framework is created, the maritime clusters of the Netherlands and Norway are discussed (Chapters 6 and Chapter 7). These real world examples demonstrate the constraints posed upon a rigorous analysis, due to a lack of data, or to a conceptual difference in the definition of a cluster. The Maritime Cluster of the Netherlands has been studied in great detail since the creation of the Dutch Maritime Network organisation in 1997. A summary of the many studies which have been published, highlights its economic structure and significance, as well as the policy agenda of the present and the future. The Dutch maritime cluster represents some 3 percent of GNP and 5.5 percent of the Dutch exports. The high export quote of more than 60 percent illustrates the international competitiveness and international orientation. The new shipping policy, which was introduced in 1996, has by now been copied by almost every European country and has significantly contributed to the revival of the European flag registration. The policy issues, which are collectively undertaken by the participating trade organisations of the Dutch Maritime Network, can be grouped under four themes: communication and image, education and labour market, export and internationalisation, and innovation and R&D. Over the period 1997-2002, the cluster grew with twenty percent, thus outperforming many industrial sectors in the Dutch economy. In order to maintain the dynamics and viability within the cluster, a level playing field is of the essence, in particular in the shipbuilding sector. The indirect value added by this sector is higher than the direct value added. This illustrates the important synergies between shipbuilding and the other maritime sectors. The agenda for the future lists a number of policy issues which are deemed necessary in order to participate in the globalisation process, while maintaining a healthy value creation in the Netherlands itself. Chapter 7 describes The Maritime Cluster of Norway by examining several studies that have been conducted during the past 15-20 years. Representing about 7 percent of the value creation, the maritime cluster is an important part of the Norwegian economy. The introduction of the Norwegian International Ship Register (NIS) in 1987, which allows ship owners to employ foreigners with salaries agreed upon in their home countries, turned the trend of registering Norwegian-owned ships under flags of convenience. The maritime cluster has grown substantially the last 10 to 15 years. The highest estimation of the economic size of the maritime cluster is â‚Ź25 billion in turnover and â‚Ź6 billion in value creation. The Norwegian maritime cluster is concentrated in seven different regions. The distances between the sub-clusters are considerable. Even though not all maritime sectors are represented in the Norwegian cluster, one of the key strengths of the cluster is regarded to be its completeness. The maritime industry in Norway includes a large number of equipment producers, maritime services, ship yards and shipping companies with the latter group of companies representing about 50 percent of the cluster. The maritime industry has created a varied and well-developed set of network organisations such as the Maritime Forum that was founded in 1990. Its aim is to strengthen co-operation between the different maritime sectors and lobbying Norwegian and international authorities on the behalf of the maritime industry. The
European Maritime Clusters
We hope that the analysis and concepts that are formulated in our study may contribute to a better understanding of maritime cluster dynamics, and that this, in turn, may result in a shared vision of the future and the policy measures necessary to make that vision come true. The book is a result of extensive cooperation across academic and geographical borderlines. Niko Wijnolst has drawn from a broad expertise in shipping, including maritime cluster dynamics and policy issues at the Dutch and European level. Jan Inge Jensen has contributed with specific knowledge in cluster theory, innovation and Norwegian maritime industries, while Sigbjørn Sødal is mainly responsible for the presentation of international economics and the development of global shipping markets. We thank the sponsors of the study2 and the publication3 for their support. Kristiansand, Jan Inge Jenssen, Sigbjørn Sødal November 2003
2 3
Agder Maritime Research Foundation, Norway Dutch Maritime Network Foundation
Rotterdam, Niko Wijnolst