Québec Marine Transportation Policy - Transport - Gouvernement ...

The Hibernia project has had no positive impact whatsoever for Québec’s shipyards. The federal
government granted its contracts for drilling platforms to Italian and Korean shipyards, despite
Québec’s expertise in this field. At the beginning of the eighties, for example, the Lévis shipyard
constructed 12 such platforms for the United States.
International Free Trade Agreements in their current form do not help the Québec shipbuilding
industry much either, because this field is totally excluded from NAFTA. Under article 27 of the US
Shipping Act, better known as the Jones Act, Americans have protected access to their markets.
Adopted in 1920, this law stipulates that vessels used for interior trade must be built and repaired
in the United States. Québec markets, on the other hand, are wide open to American competitors.
This sector is also excluded from the WTO agreement on public markets.
The shipbuilding industry’s problems persist despite the consistent efforts made by the gouvernement
du Québec to revitalize shipbuilding during the last few years. The government
adopted a series of tax measures in 1996 which were designed to assist the maritime sector.
Shipbuilders receive guaranteed loans and tax credits to finance the construction of prototypes.
Capital tax for owners of new boats destined for navigation in international waters has been
reduced. During this period, the federal government chose to maintain a 25% customs duty on
imported vessels, thus increasing the cost of acquisition for Québec ship owners, but this measure
does not have any benefit for shipyards.
Future prospects for the shipbuilding industry are,
however, highly encouraging. Both the Québec
ferry fleet and the Canadian shipping fleet are
ageing, which would indicate better days ahead.
The development of new petroleum projects in
Newfoundland could also benefit the Québec
economy, as long as the province is sufficiently
proactive.
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