Positioning Singapore's maritime sector for the future

READERS will not need this column to inform them that this is a very busy time in Singapore. We are halfway through this nine-day "week" and a huge range of topics have been debated.

The main theme, however, for Singapore Maritime Week (SMW) 2019 - organised by the Maritime and Port Authority of Singapore (MPA) - is "Driving Connectivity, Innovation and Talent" and perhaps more basically, as for every SMW, it is about bolstering Singapore's standing as a leading global maritime hub.

As part of that, in the 13th Singapore Maritime Lecture, Singapore's Minister for Trade and Industry Chan Chun Sing spoke about how the Republic can position itself for the future amid changes in the maritime industry.

He started off his presentation by identifying key driving forces for the maritime industry. These include rising protectionism which could inhibit global trade, increased consumerism in Asia which could create growth opportunities for the shipping industry, technological changes and greater intermodal connectivity that will affect future maritime landscape, as well as climate change that will shift the shipping regulatory landscape or upend the maritime economic ecosystem in the region.

Mr Chan said, as shipping redesigns its business models for the 21st century, Singapore must also rethink its maritime strategy. Singapore can only retain its Global Hub Port and International Maritime Centre status if it is able to navigate the challenges well and harness opportunities that come with the driving forces.

Among several other points, Mr Chan also said for Singapore to succeed as a maritime hub, physical trade should not be seen in isolation but as a multifaceted connectivity that includes data, talent, technology and finance flows. Singapore also needs to broaden and deepen its maritime services offerings by strengthening complementary adjacent sectors such as finance, insurance, commodity trading and logistics, as well as nurture a pipeline of local maritime experts. In addition, Singapore must defend an open, rule-based trading order, even as the rules need updating in the new economy, to promote a predictable, pro-business and open environment.

Talking about rules, having a legal system that is well suited to the needs of international shipping is another crucial component of a successful maritime hub.

While legislative updates may not generate a lot of excitement outside legal circles, James Scott, senior associate, Reed Smith in alliance with Resource Law, has drawn this column's attention to an important development.

He points out that Singapore will soon be implementing the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims of 1976 (as amended in 2012 and effective from 2015), following the passing of the Merchant Shipping (Miscellaneous Amendments) Bill.

Long-term view

Mr Scott says that, with the passing of the Bill, Singapore's limitation of liability regime for maritime claims will be aligned with leading maritime jurisdictions such as England and Hong Kong, which have acceded to the 1996 Protocol as revised with the higher limits effective from 2015. Significantly, the amendments will mean that Singapore's limitation of liability regime will be more favourable to maritime claimants as compared to that of other regional centres.

It is fair to say that as far as is possible, Singapore is striving to be able to cope with any challenges that could threaten its standing as a global maritime hub. But it would take a brave person to claim any industry or international centre is able to really future-proof itself. Can anyone really predict the future?

That was a question I asked myself last week when I saw a TV news item about personal jetpacks being showcased in New York. They are powered by lightweight gas turbines. I suppose personal jetpacks have long featured in any stereotypical view of the future. But what really caught my attention was a casual remark that the entire equipment, including the turbines, had been created by 3D printing.

Most of our assumptions about the future of international shipping are based on the premise that there will be, in the long term, increased demand for goods and free trade will allow the cheapest producers to export their goods to markets where local production would be more expensive. In other words, comparative advantage will continue to drive expanding global trade.

But perhaps, just perhaps, there could be an alternative vision. What if increased use of local production and possibly a move away from a throw-away culture meant that the size of the world fleet does not continue to grow in the way it has until now?

For a small country like Singapore, which can't keep on building new berths forever, that could be good news. It would be even more important though to boost the other sectors of the maritime economy, in exactly the way SMW is doing.

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