Industry and globalisation

Workshop on Supply and Demand in the Shipbuilding Industry, 9 November 2015


On 9 November 2015, the OECD Council Working Party on Shipbuilding (WP6) hosted a workshop at OECD Headquarters in Paris. It was attended by representatives of OECD and Partner governments, industry associations, shipbuilding firms, industry experts and trade union representatives and industry experts, notably Dr Martin Stopford – the author of the acclaimed 'Maritime Economics' book.

This workshop on supply and demand in the shipbuilding industry aimed at increasing transparency in the market, which is expected, in particular, to provide a better comprehension of the magnitude and the sources of oversupply and overcapacity. This will improve our understanding of certain policies leading to such market distortions. In this regard, excess supply and excess capacity are generally associated with increased pressure on governments to support the industry during economic downturns. This workshop also considered capacity and structural adjustment aspects, as well as other related topics, including the role of ship finance.

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Session 1. Oversupply and overcapacity: assessment of its magnitude and role of policies

This session aimed at assessing the magnitude of excess supply and excess capacity in the shipbuilding industry.

i) Overview of the world shipbuilding capacity situation

ii) Measurement issues : the compensated gross tons (CGT) system

  • Introduction to CGT measurement 
    The OECD Secretariat presented the current CGT system that became effective in January 2007 based on a new set of rules published by the OECD in November 2006. The presentation focused on the weaknesses of the current CGT system especially for sophisticated vessels including offshore ships and mega-yachts.

  • Compensated Gross Tonnage for Superyachts 
    Presentation by Mr. Chris van Hooren (Technical & Environmental Director, Superyacht Builders Association, SYBAss) on the building process, employment, job intensity and costs for mega-yachts, as well as his position regarding the existing CGT calculation methods.

  • Measurement issue: the compensated gross tons, CGT system 
    Presentation by Ms. Jenny Braat (CEO, Danish Maritime & Chairwoman, SEA Europe Working Group on Market & Forecast) on improving the compensated gross tonnage (CGT) system.


Session 2: Ship finance and its potential impact on excess capacity

The second session of the workshop dealt with ship finance developments, given the fact that finance, notably from state and public institutions, plays a key role in terms of capacity expansion and capacity reduction, in particular when restructurings occur.


Session 3: Current and past policies for expanding, maintaining or reducing capacity

The third session dealt with current and past policies for expanding, maintaining or reducing capacity and their possible impact on the future level of global shipbuilding capacity.**

Introductory presentation by the OECD Secretariat of future trends in terms of capacity expansion in selected economies in the near future.


Session 4. Ongoing and future work on excess capacity, excess supply and related issues

The last part of the Workshop discussed ongoing and future work.

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