Canada announced a waiver of its 25 percent import tariff on general cargo vessel, tankers, and ferries longer than 129 meters. The decision will save shipowners $25 million per year over the next decade.
“This duty relief will accelerate the renewal of the Canadian marine fleet across the country and will help replace aging vessels with cleaner, safer and more efficient ships,” said the Chuck Strahl, Minister of Transport, Infrastructure and Communities. “All the while, it will build on unprecedented investments our Government has made in Canada’s infrastructure and gateways by contributing to the upgrading of marine transportation links across the country.” (Marine Log, October 4, emphasis added)
The announced tariff initiative should bring into the Great Lakes newer and more efficient competition for the existing commercial fleet flying the US flag. Perhaps it will stimulate new shipping activity on the Lakes, which would be good. Ships will move goods more efficiently to the benefit of energy savings and air quality.
If you have the feeling that our friends to the north are thinking and acting strategically, with an eye to the large American market, it is because they are…as they should.
Will Washington watch and learn? Or will the dusty ol’ status quo continue to be good enough for US? In using this most recent example of Canadian initiative I refer to nothing so specific as Jones Act requirements but, broadly, to the insufficient attention and action to address the glaring need here, especially on the marine transportation system.
Much is known as to the general direction of the Obama Administration’s thinking on transportation policy—passenger rail, public transit, livable communities, sustainability, etc.—if not about detailed proposals. But when it comes to goods movement little has been said.
Officials at USDOT acknowledge having been slow to focus on the subject of freight. Early on there was the view that the heavy volume of international cargo ramping onto US highways and rails was the sort of thing not meriting Federal attention–“making imported flip-flops even cheaper” was the oft quoted line–as if that were the sum total of goods movement pressures in the country. The thinking since last year boiled down to the notion that the freight sector will take care of itself, as Transportation Under Secretary for Policy Roy Kienitz acknowledged last week. The private sector nature of goods movement could lead one to that view, I suppose.
However, Roy Kienitz went on to indicate that more thought is going into the subject now. He said that a presentation by Canada’s ministry of transportation on their gateway strategy made a strong impression on him. The strategy is a public/private initiative. He noted it is intended to attract more North American import/export trade through their British Columbia and Atlantic ports and thus make Canadian operations significant players deep into the American Midwest market.
In the Canadian initiative he can appreciate how government can play an important role working with the freight sector. Hopefully USDOT also understands that the American transportation sector can lose business if we just sit and watch while others press ahead.
In fairness, a good percentage of USDOT-issued TIGER grants went to rail, marine highway and other freight related projects earlier this year. We take that as a positive sign. But the longer it takes official Washington to actually do something structural about America’s aging infrastructure, the capacity to handle growing freight volumes, and a listless maritime sector the more ground we lose.
The examples of strategic planning and investing abound around the world including just north of here.
What are we doing down here? Pbea