90 percent by sea - Defence Academy of the United Kingdom

More documents

Recommendations

Info

total in 1950; by 1960, this had fallen to 16%. Today the total share is just over 2 ½% 60 - a significant decline, although still ranking as the world’s fifth largest trading nation. Overseas trade is predominantly with the EU (approx 55%); and the USA is still the UK’s largest single trading partner. 61 Nevertheless, while relative decline has been significant, the UK is vastly richer in real terms than in 1900; value of imports and exports has grown; and tonnage has massively increased. 62 This has mirrored the incredible increase in world merchant trade – over the last 40 years alone, sea borne trade has nearly quadrupled – from around 2.5 billion tons, carried in a world fleet of 326 million tons of shipping in 1970, to over 8 billion tons of cargo carried in over a billion tons of shipping in 2008 63 - so while the British share of the whole has gone down significantly, the total amount of cargo passing through British ports has steadily increased. Thus, although it is tempting (and traditional) to see UK trade as having declined significantly in real terms since the height of empire, this is incorrect by almost any measure – in fact, staggeringly so. In 1897, near the zenith of British Imperial dominance in trade, British ports handled around 80 million tons of imports and exports. In 2011, UK ports handled over 500 million tonnes of cargo including over 5.5 million containers. 64 Today, the UK imports and exports to China alone a greater volume of cargo than Britain traded with the whole of the empire at the height of her Imperial trading power. Also significant is Britain’s decline as a manufacturing powerhouse, largely due to the reconfiguring of the British economy to services and finance, which now accounts for over 75% of GDP, with production and agriculture combined at around 16%. 65 This has a huge impact on the UK’s trade balance. Historically, up until the 1980s Britain has broadly maintained an even trade balance: exports approximately matched imports. However, this has radically changed over the last thirty years and the trade deficit now stands at around £4 billion a month – the sixth highest in the world and excluding financial and service (‘invisibles’) this increases to around £9 billion. In other words, the UK imports £9 billion more manufactured goods and commodities than it exports, every month of the year. 66 Thus outside of wartime, the UK has never been so dependant on imports as it is today. 60 IMF, World Economic Outlook report, April 2012: 179, http://www.imf.org/external/pubs/ft/weo/2012/01/pdf/text.pdf (accessed 10 May 2012). 61 Department for Business Innovation and Skills: UK trade performance over the past years: 9, http://www.bis.gov.uk/assets/biscore/international-trade-investment-and-development/docs/u/11-720-uk-tradeperformance (accessed 9 May 2012) 62 IFW, ‘Quarterly UK Sea Freight Statistics, Q1 2011’. http://www.ifwnet.com/freightpubs/ifw/article.htm?artid=20017882827&src=rss (accessed 7 Dec 11) 63 UN CTAD, Review of Maritime Transport 2009 (New York and Geneva: United Nations, 2009), 76 64 Quarterly UK Sea Freight Statistics, Q1 2011, accessed 7 Dec 11. 65 Office of National Statistics, United Kingdom National Accounts (The Blue Book) 2011, 30, http://www.ons.gov.uk/ons/rel/naa1-rd/united-kingdom-national-accounts/2011-edition/index.html (accessed 10 May 2012) 66 Department for Business Innovation and Skills, UK trade performance over the past years, 7-15 11
It is not just the scale of maritime trade that has evolved beyond all recognition since the middle of the 20 th Century. It is also the globalised nature of maritime commerce. 67 Commercial shipping has been transformed by de-regulation, with ‘national’ fleets of merchantmen, although resurgent, still dwarfed by shipping flying flags of convenience, manned by multinational crews and carrying cargoes who’s ownership may change several times during a voyage, particularly with ‘global’ commodities such as oil or grain. Containerisation has also transformed the industry: a modern ocean-going container ship can routinely carry up to 15,000 twenty foot containers – two of these ships can carry the equivalent tonnage of an entire WW2 convoy. 90% of the world’s manufactured goods are shipped in containers, as well as a quarter of the world’s dry cargo: in 2011, there were an estimated 29 million containers in service around the world. 68 Containerisation has also transformed trade by allowing the accurate prediction of cargo quantities, arrival times and condition. Ships unload in hours, not weeks. ‘Just in time’ manufacturing, a business model pioneered by Toyota to drive down the inefficiencies of holding inventory, has been embraced to now include energy, commodities and food as well as manufactured items: delivery can be predicted within hours, raw materials can arrive on the same day they are required for production and inventory, and thus costs, are minimised. 69 Ocean carriage has been replaced by door to door delivery – a total logistics system. Production can be distributed globally, with components brought together at the final point of assembly from around the world, enabled by seamless delivery. Coupled with the vast economies of scale inherent in bulk and containerised shipping, seaborne movement of goods is cheap, reliable and thus good for business – pre containerisation, shipping costs were typically 5-10% of the retail price; today, this has dropped to far less than a single percent. 70 But as a consequence, the concept of a “reserve”, able to sustain an enterprise in the event of a disruption to supply, has all but disappeared. Once dockside wharves and warehouses would store weeks or even months supplies of commodities and goods to cope with fluctuating demand or the vagaries of supply. An uninterrupted, seamless flow between customer and supplier regardless of location makes this an expensive and unnecessary way of doing business. This has clear strategic implications for the nation’s resilience and places an absolute imperative on the maintenance of uninterrupted use of the sea globally, in every circumstance. Sea routes have remained largely unchanged, although as shipping increases in size and strength, more extreme routes – such as Cape Horn and the Cape of Good Hope – are used all year round and newer routes, such as the North West Passage and Northern Sea Route 67 Sam J Tangredi, ed., Globalization and Maritime Power, (Washington: National Defence University Press, 2002), 10 68 UNCTAD, Review of Maritime Transport 2011, 39 69 Tangredi, ed., Globalisation and Maritime Power, p 135 70 Ibid., 134 12
Page 2 and 3: 90 percent by Sea: Maritime Commerc
Page 4 and 5: ‘We’re a maritime nation—we
Page 6 and 7: The idea that Britain’s power der
Page 8 and 9: the merchant ships themselves. Even
Page 10 and 11: equired, what are they for? As a Bo
Page 12 and 13: Application of Maritime Power’ is
Page 16 and 17: etween the Atlantic and Pacific nor
Page 18 and 19: largely had to become a self-sustai
Page 20 and 21: lanes, and beyond. Power from the s
Page 22 and 23: But times have changed in fundament
Page 24 and 25: It also highlighted the ability of
Page 26 and 27: around 2 percent to the cost. Even
Page 28 and 29: Executive of the Baltic Exchange co
Page 30 and 31: adically altering strategic environ
Page 32: high water mark. Indeed, the concep
Page 35 and 36: Heinl, Robert D. Dictionary of Mili
Page 37 and 38: United Kingdom. Maritime Warfare Ce
Page 39 and 40: Cm 3999, Strategic Defence Review:
Page 41: Published by Defence Academy of the

90 percent by sea - Defence Academy of the United Kingdom

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?