• UK maritime services overseas earnings reached £2.1bn in 2008 up 40% from £1.5bn in 2006
• Maritime services worldwide seeing downturn in business in 2009 due to a drop in seaborne trade
• London maintains lead in global maritime service provision owing to its shipbroking, insurance, ship classification, finance and legal services
Buoyant markets underpinned record UK maritime services exports of £2.1bn in 2008 with nearly half originating from shipbrokers. The two-yearly Maritime Services report from International Financial Services London (IFSL), the independent organisation promoting UK financial services around the world, confirms London’s position as a leading centre worldwide in the supply of business services to the international maritime community.
In particular, IFSL’s report highlights London’s strength in the following key areas:
Shipbroking: London’s 400 shipbroking firms generated net exports of £948m in 2008, 23% up on £769m in 2007. The Baltic Exchange Dry Index (BEDI) has reflected the drop in seaborne trade, with a peak-to-trough decline from 11,793 to 663 during 2008, and averaging 2,400 in 2009 up to mid-September. Shipbrokers in London perform a key global role matching ships and cargoes for 50% of the tanker and 30-40% of the dry bulk chartering business. They are also involved in the sale and purchase of over half the world’s new and second hand tonnage. The notional value of Freight Forward Agreements (FFAs) traded by shipbrokers in over-the-counter derivatives market reached a record $163bn in 2008, but is expected to drop to $40bn in 2009.
Insurance: With 17% of premiums in the international marine insurance market in 2008, London remains the leading centre in the face of fierce competition from Japan, the USA and Germany. London is also the largest centre in the management of protection and indemnity insurance, with P&I clubs operating in the UK accounting for 62% of the global market in 2008.
Ship finance: In ship finance, the loan book of $50bn provided by commercial banks in London accounted for 13% of the world book at end-2008, down from 16% in 2006. The world loan book soared to $391bn in 2008, on the back of the surge in shipbuilding orders, but is expected to contract sharply as the supply of finance is limited by banks’ capital and credit constraints.
Ship classification: Lloyd’s Register is the second largest ship classification society in the world, accounting for 18% of the world fleet.
Legal services: London is the leading centre in legal services involving about 30 law firms. English law is widely applied to shipping disputes, usually involving foreign interests.
Duncan McKenzie, IFSL’s Director of Economics, notes “The global economic downturn has contributed to an expected 10% drop in seaborne trade in 2009. The knock-on impact on maritime services means that UK overseas earnings in 2008 represent a high point unlikely to be exceeded for a few years.”
Click here to view PDF of the Maritime Services 2009 report
• Maritime services worldwide seeing downturn in business in 2009 due to a drop in seaborne trade
• London maintains lead in global maritime service provision owing to its shipbroking, insurance, ship classification, finance and legal services
Buoyant markets underpinned record UK maritime services exports of £2.1bn in 2008 with nearly half originating from shipbrokers. The two-yearly Maritime Services report from International Financial Services London (IFSL), the independent organisation promoting UK financial services around the world, confirms London’s position as a leading centre worldwide in the supply of business services to the international maritime community.
In particular, IFSL’s report highlights London’s strength in the following key areas:
Shipbroking: London’s 400 shipbroking firms generated net exports of £948m in 2008, 23% up on £769m in 2007. The Baltic Exchange Dry Index (BEDI) has reflected the drop in seaborne trade, with a peak-to-trough decline from 11,793 to 663 during 2008, and averaging 2,400 in 2009 up to mid-September. Shipbrokers in London perform a key global role matching ships and cargoes for 50% of the tanker and 30-40% of the dry bulk chartering business. They are also involved in the sale and purchase of over half the world’s new and second hand tonnage. The notional value of Freight Forward Agreements (FFAs) traded by shipbrokers in over-the-counter derivatives market reached a record $163bn in 2008, but is expected to drop to $40bn in 2009.
Insurance: With 17% of premiums in the international marine insurance market in 2008, London remains the leading centre in the face of fierce competition from Japan, the USA and Germany. London is also the largest centre in the management of protection and indemnity insurance, with P&I clubs operating in the UK accounting for 62% of the global market in 2008.
Ship finance: In ship finance, the loan book of $50bn provided by commercial banks in London accounted for 13% of the world book at end-2008, down from 16% in 2006. The world loan book soared to $391bn in 2008, on the back of the surge in shipbuilding orders, but is expected to contract sharply as the supply of finance is limited by banks’ capital and credit constraints.
Ship classification: Lloyd’s Register is the second largest ship classification society in the world, accounting for 18% of the world fleet.
Legal services: London is the leading centre in legal services involving about 30 law firms. English law is widely applied to shipping disputes, usually involving foreign interests.
Duncan McKenzie, IFSL’s Director of Economics, notes “The global economic downturn has contributed to an expected 10% drop in seaborne trade in 2009. The knock-on impact on maritime services means that UK overseas earnings in 2008 represent a high point unlikely to be exceeded for a few years.”
Click here to view PDF of the Maritime Services 2009 report
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