Total gross tonnage of S'pore-flagged ships set to grow this year

Total gross tonnage of S'pore-flagged ships set to grow this year

Singapore - THE total gross tonnage (GT) of ships flagged under Singapore's registry is on course to expand this year over 2015, although it will remain in the single-digit growth range for the second year running.

Maritime and Port Authority (MPA) of Singapore director of marine Tan Suan Jow told The Business Times that the Singapore Registry of Ships (SRS) is expected to end the year with close to 88 million GT of ships registered under the flag state.

Annual growth rate in total GT for this year is projected to remain flat at about 3 per cent, a decline from the double-digit expansion the ship registry had enjoyed through the first half of this decade.

But Mr Tan noted that the growth in SRS GT is in tandem with the global average, despite a downturn across almost every maritime sub-sector, including shipbuilding.

He also qualified that Singapore is "not chasing after numbers" when it comes to flagging ships; instead, its aim is to bring on board good-quality ship owners and ship managers to set up offices here. Their presence will attract service providers - banks, lawyers and P&I (protection and indemnity insurance) clubs - to Singapore. All in, about 5,000 maritime companies, including 130 to 150 ship owners, are based in the Republic.

The SRS is expected to maintain its ranking as the world's fifth largest ship registry in vessel count; Singapore had emerged fifth last year, behind Panama, Liberia, Marshall Islands and Hong Kong, said Lloyd's List Intelligence.

Leading ship owners such as Maersk Line have ships flying the Singapore flag; Maersk and its fellow Danish shipowners have more than 260 ships registered with the SRS.

How far a ship registry can command clout among ship owners hinges on whether the flag state adopts a service-oriented mindset, or a rule-setting one, Danish Shipowners' Association director-general Anne Steffensen told BT. She described Singapore as "a home away from home for Danish ship owners", who find numerous services rendered here; they also appreciate the transparency on flag-state requirements.

As the going gets tougher for ship owners, the MPA has dug deep into its toolkit to help industry players hit by the downturn.

As BT went to press, the regulator was about to unveil enhancements to the annual administrative fee (AAF) scheme for Singapore-registered ships: Where a flat annual fee of S$600 applied to every Singapore-flagged ship before, a three-tiered fee structure will take effect from Jan 1, depending on the size of the vessel. Ships under 300 GT will pay S$120; those between 300 and 2,000 GT will pay S$300, and those above 2,000 GT, S$600.

Mr Tan said the flat-fee AAF scheme in force since Jan 1, 2014 was welcomed for delivering savings and cutting time ship owners spent on paying fees for different services rendered by SRS. However, the MPA has taken on board suggestions from the industry for a tiered pricing system to reflect the varying service levels Singapore-flagged ships may require depending on their size.

The tweak to the AAF comes after the MPA extended port-dues concessions to bulk carriers, container ships and offshore support vessels.

In June, MPA extended its incentives under the Green Ship Programme (GSP) to ships using liquefied natural gas, a cleaner-burning fuel widely considered to be part of the future bunkering mix aligned with the move by the International Maritime Organisation (IMO) to cut ship emissions.

Captain Philip Tay of Apex Ship Management Pte Ltd named the GSP and the Block-Transfer Scheme (BTS) as examples of pro-business and pro-environment schemes launched by the MPA. Singapore-flagged ships do not encounter problems trading internationally because the flag state is a party to all major IMO conventions on ship safety and the prevention of marine pollution, he said.

The veteran seafarer said the BTS delivers the most significant cost advantage to the SRS vis-a-vis other ship registries. Under the BTS, ship owners can register their vessels at S$0.50 per NT (net tonnage), and pay a minimum of S$1,250 (for 2,500 NT) and a maximum of S$20,000 (for 40,000 NT).

The average cost to ship owners per year can be about half that for ships under Liberian and Panamanian flags, Capt Tay noted. He called on the MPA to consider extending the qualifying deadline for the BTS to ship owners. BTS applies to owners registering vessels within 12 months of the first approval date, subject to certain criteria.

This article was first published on Dec 1, 2016.
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