Coasting Trade: Domestic ship operators abandoned by Transport Canada?
Written by: Martin Fournier
Executive Director of St. Lawrence Shipoperators
By signing the Comprehensive Economic Trade Agreement (CETA) with the European Union, Canada has created an unprecedented breach in the Coasting Trade Act. European ship operators and third-country companies owned by European nationals will have access, upon implementation of CETA, to certain parts of the Canadian market, leaving domestic ship operators unable to compete.
A glitch in the process? Transport Canada has finally admitted that it failed to properly consult domestic Canadian ship operators. Yet, Ottawa is currently negotiating the Trade in Services Agreement (TiSA) with 49 partners, without having consulted domestic ship operators first. TiSA will open the Canadian market to ship operators from partner countries that also give Canadian ship operators access to their markets.
Multi-partner reciprocity—complete with each member’s coasting trade regulations—will not be easy, and it is illusory to think that domestic ship operators stand a chance under this agreement.
In brandishing the reciprocity card, Transport Canada is turning a blind eye to the requirements governing domestic Canadian-flagged ship operators. According to a study dating from 2015 commissioned by St. Lawrence Shipoperators, the crew-related costs of European-flagged vessels represent as little as 30% of the costs incurred by their Canadian counterparts, thus precluding healthy competition and reciprocity. Opening the coasting trade market under these conditions is tantamount to abandoning Canadian ship operators and seafarers.
The Canada Transportation Act Review Report, commissioned by the previous government and tabled in January 2016, recommends nothing less than phasing-out the coasting trade over a seven-year period. In a letter addressed to St. Lawrence Shipoperators during the last federal election campaign, the Liberal Party clearly stated that it had no plans to change the Coasting Trade Act, adding that the latter “protects and supports domestic marine interests”.
At a time when the Quebec government is promoting maritime transport and fostering the development of short sea shipping through its Maritime Strategy and when the Conference of Great Lakes and St. Lawrence Governors and Premiers is releasing the first-ever regional maritime strategy, which also supports short sea shipping, the federal government seems to have lost all interest in domestic maritime transport.
After years of under-funding port infrastructures, withdrawing from dredging, paralysis with regard to icebreaker fleet renewal, it is the coasting trade’s turn to be severely tested. It is crucial that decision-makers grasp the scope of the economic, social and environmental role shipping plays and the critical importance for our country to have a strong, healthy marine industry and domestic fleet.
Also available on-line at this link:http://maritimemag.com/im