30 000 jobs wait at sea

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A national investment in the maritime industry could create 30 000 jobs at sea, says the SA Maritime Safety Authority (SAMSA).

SAMSA CE Tsietsi Mokhele told Business Report in a telephone interview that a South African-flagged merchant navy of 300 vessels would create 30 000 job opportunities for South Africans at sea.

Repeating a theme mooted at the SA Navy’s Third Sea Power for Africa Symposium in March, Mokhele told the business broadsheet the number of vessels was required “to secure supply of goods and build skills capacity for the maritime sector.”

He said SAMSA wanted to attract close to 20% of this number by the end of the 2010/11 financial year through legislative changes that were already under way.

The changes include the introduction of tonnage tax, the revision of the maritime transport policy and the overhaul of the SA Ship Registration Act next year.

At present, only one ship is registered in SA and it will be decommissioned by the end of next year.

Mokhele says 98% of SA’s imports and exports are transported by sea. “We are a freight-dependent economy as 50% of gross domestic product is trade.

“If you don’t own vessels, you cannot grow the industry itself because one vessel creates about eight to 10 jobs on the land and you cannot increase the number of seafarers because graduates must do training on a ship before they qualify.”

Tonnage tax would mean that shipping companies would be taxed at a fixed rate according to the size of their ships and not according to income, making South Africa’s tax environment more competitive than it is now.

Treasury spokeswoman Thoraya Pandy told Business Report the fiscus had asked for more comment from the industry, which must be submitted by the end of February.

It was too early to determine if tonnage tax would attract shipping lines to register vessels because tax was one of many considerations for potential investors, Pandy said.

Safmarine has indicated that it would consider registering more ships in the country if there was a tonnage tax. Of the company’s 20 vessels, one is registered in South Africa, four in Belgium and 15 in the UK.

“Tonnage tax in our view would create a more globally competitive tax environment, which in turn would act as a catalyst for foreign investments in the maritime industry,” said Fred Jacobs, the corporate affairs executive at Safmarine.



“Business decisions would also be based on sound commercial rationale rather than just on tax considerations.”