With close to 16,000 kilometres of coastline, Norway has always been a country with strong ties to the sea.
Today, the country’s maritime industry accounts for about 10 per cent of the world’s total fleet. It is also Europe’s most diversified seafaring nation and commands worldwide respect for its shipping expertise, equipment and ability to exploit new market niches. Norway’s overall maritime economy — an expanding cluster of industries linked to shipping and the aquaculture industry — encompasses an increasingly wide variety of products and services.
The sector, the second largest behind oil and gas, currently employs nearly 100,000 people, of which close to 60,000 work on ships and rigs, according to the Norwegian Shipowners’ Association. “The maritime sector is a driving force for growth in Norwegian trade and industry,” says Sturla Henriksen, director-general of the association. “Maritime companies represent one of Norway’s strongest industries, an internationally competitive global leader, with unique potential for future growth and development,” he adds.
The maritime sector in Norway can be divided into two main categories: coastal and international deep sea. Coastal shipping includes car ferries, fishing boats, fast passenger crafts, coastal express steamers, tugs, cargo ships, tankers, reefers, cable ships, rescue boats and the oil and gas-related fleet. The deep-sea category includes the Norwegian foreign-going fleet, both those operating under the nation’s flag and those registered under other flags. Interestingly, more than 90 per cent of the merchant fleet never docks at a Norwegian port, but cross trades between other countries.
Many shipping companies muster personnel from Eastern Europe, mainly Poland and Latvia, the Nordic countries and countries outside the European Union and the European Economic Area, namely China and the Philippines, for work, predominantly on foreign-going vessels, a spokesman of the Norwegian Labour and Welfare Administration (NAV) tells GN Focus. He adds that the salaries for qualified seamen in the industry vary between €28,000 (about Dh133,099) and €42,000 per year gross.
The share of the maritime industry in GDP went up to 50 per cent from 3.7 per cent to around 5.5 per cent between 2002 and 2008 respectively and is since stable, says Erik W.Jakobsen, managing partner at Oslo-based research firm Menon Business Economics.
“But we also have to see that the share of Norwegian ships in the world fleet is declining”, he adds, which has to do with uncertainty in the international economic outlook over the past few years and the rise of shipping companies especially in East Asia. Therefore, the industry has started to create maritime clusters to bundle their activities and develop innovative projects for niche sectors.
The highly competitive maritime industry that earlier had a rather conservative attitude towards information sharing is now working together to transform the Norwegian shipping community into a more open innovation sector.
Such clusters can be found in Oslo, Bergen and Alesund, where, for example, the cluster Norwegian Centre of Expertise Maritime consists of 15 design companies, 18 ship-owning companies, 14 shipyards and 159 equipment suppliers, employing 21,000 people and generating €6.95 billion in revenues, says Jørgen Fodstad, director of the Norwegian trade portal Nortrade.
However, Norwegian shipping companies are increasingly looking to export their know-how to offshore clusters on other continents, of which the biggest are located in Singapore, the UAE, Brazil and China.
In the UAE, Norwegian shipping companies are collaborating closely with Drydocks World not only to build vessels and deep-sea ships but also to work on innovative projects such as what is seen as the world’s biggest wind power offshore platform to be erected in the German part of the North Sea for Norwegian energy company Aibel.
Almost all major Norwegian shipping companies have used the services of Drydocks World for ship repair, offshore construction, conversion and building advanced vessels. For Norwegian-owned and Dubai-based marine geophysical company Polarcus, Drydocks World has built three specialised seismic vessels.
In its aim to diversify the shipping industry, Norway is also looking for more lucrative niches where the sector can bank on its know-how and experience. For example, an area of research is focused on shipping possibilities in the Arctic areas.
“Norwegian ships and offshore vessels are among the world’s most advanced and therefore well suited for operations in northern waters,” says Nortrade’s Fodstad.
Another target is to make the shipping industry greener. “The Norwegian Shipowners’ Association takes a proactive stance on the issue of climate change,” says Henriksen.
It is estimated that the global maritime sector emits almost 3 per cent of total greenhouse gases. The Shipowners’ Association has a goal of zero emissions and assumes initiative in helping reduce the carbon footprint of the sector. This includes implementing more energy efficiency in operations and the increased use of liquefied natural gas as fuel.
As opposed to the shipbuilding industry, Norway’s biomarine industry expects high growth rates over the coming years.
A recently issued report by the Royal Norwegian Society of Sciences and Letters and the Norwegian Academy of Technological Sciences predicts that the Norwegian biomarine industry may increase from today’s €12 billion to €75 billion in 2050, taking into account global trends such as the increased need for food in general and the increased demand for seafood in particular.
“We see an optimistic and visionary scenario that demonstrates that the full potential from the utilisation of the seas and oceans have not yet been realised,” Christina Abildgaard, member of the group preparing the study, said in the report.
In fact, over the past three decades, the Norwegian aquaculture industry has been at the forefront of global developments. Norway’s aquaculture outfitters have developed and are producing a wide array of fish farming equipment, including breeding, caging and feeding systems, monitoring equipment and fish processing technology.
The industry is located along the entire coast, and many communities depend on the revenue and employment it provides. Aquaculture supports about 5,000 direct jobs, mainly related to fish farming and fish processing. In addition, the industry creates jobs in a number of other industries such as transport, packaging, fish feed production and fish farming equipment development and production. The total number of jobs supported by the industry is estimated to be more than 20,000.
Norway is the largest producer of Atlantic salmon in the world, producing around one million tonnes annually. Rainbow trout, cod, halibut, shellfish and Arctic charr are also farmed there, although in smaller amounts, according to Nortrade.
“2011 was another good year for Norwegian seafood export despite the economic crisis that rocked its major markets,” the Norwegian export marketing portal Norway Exports noted in its latest annual report. Norway sold ¤7 billion worth of traditional and farmed fish to 129 countries with most of the demand coming from Japan, China, Portugal, and Russia, emerging as the new largest export market.