Singapore or London?
The British capital London is still reputed to be the world’s maritime shipping centre. Singapore is increasingly challenging this position, however.
«The world does not wait for London,» warned Nigel J. Anton, global head of shipping finance of the Standard Chartered Bank (Hong Kong), at an event held as part of the first London International Shipping Week (LISW). «Everything works in Singapore,» he added. While many a participant may not have been delighted by these words, Anton qualified his statement by reminding his audience that London had made the maritime shipping industry what it is today.
In future, however, the balance may shift towards the East. In particular the Southeast Asian city state Singapore has developed into a major hub for the maritime shipping industry over the last few years. It has already overtaken its competitor Hong Kong by a clear margin, and now Europeans too are feeling the impact of stronger competition from the East.
The share of the world’s ship tonnage held by Asian owners has been steadily growing for some time now, whilst the influence of major shipowners in European countries such as Germany simultaneously appears to be decreasing. Singapore is becoming an ever more popular location for ocean carriers’ headquarters as well. 5,000 maritime sector companies are based there, more than 4,500 of which are multinationals. More than 170,000 people work for ocean carriers and agencies, shipping agents, in ship financing, for lawyers specialising in maritime law, for insurance companies or in other related service sectors.
Singapore also houses the headquarters of the Asian Shipowner’s Forum and the International Bunker Industry Association (Ibia), and is additionally the home to an important branch office of the London-based institution Baltic Exchange.
Tax advantages in the East
Certainly, the excellent infrastructure and the city state’s convenient geographical location are important reasons for foreign companies to open offices in Singapore. However, one decisive factor may be that the Maritime and Port Authority of Singapore (MPA) seeks to create an agreeable business environment for these companies, and above all focuses on ensuring advantageous tax rates and easy conditions for the creation of companies or affiliates.
Moreover, it is relatively easy to hire foreign or local manpower in Singapore. The level of education is high. Every university in Singapore offer degrees in the maritime sector, and the city’s government is investing a lot of money in the industry.
So it does not come as a surprise that a survey, conducted during the LISW among members of the Shipping Professional Network in London (SPNL), showed that 70% of the young people surveyed believed that the British capital could lose its status as a maritime centre. One of the participants hit the nail on the head: «Today the best talents in the business head for Singapore, and not for London anymore.»