Canada mulls long-term shipbuilding strategy

OTTAWA, Aug. 5 (UPI) -- Canada is examining options for developing a major shipbuilding industry as part of a long-term strategy that may involve $40 billion in government investment over the next 30 years.

A government-led consultation that began on July 27 will be followed in the fall by further discussions, including a conference open to the public Nov. 4 at the School of Policy Studies at Queen's University, Kingston, Ontario.

Canada has dual interest in beefing up its shipbuilding capacity. Its coastal communities depend on shipbuilding activities for jobs and social cohesion. Its maritime and defense requirements call for vast fleets to be maintained and renewed at utmost readiness.

The federal government's own fleet renewal plans could mean investments of more than $40 billion into building about 50 large vessels, a consultation document said. The costs of building or maintaining related infrastructures have not been discussed yet, but they will add millions to the bill, industry sources said.

Canada has the world's longest coastline, 151,485 miles including the coastline of its 52,455 islands. But dwindling orders for new ships and other vessels have taken a toll on the shipbuilding industry.

Government and industry experts say a dedicated revival of the shipbuilding industry through new orders for navy, coast guard and maritime industry vessels is essential to Canada's security and defense preparedness.

Shipbuilding regeneration will create tens of thousands of jobs and rekindle communities worst hit by poor maritime sales and, more recently, global downturn.

Peter MacKay, minister of national defense and for the Atlantic Gateway, said at the July launch of the consultation the pooling of stakeholders' resources "will help ensure the Canadian navy gets the fleet of vessels it needs, while high-value jobs are created and sustained in shipyards across Canada."

Canadian shipyards invested more than $175 million over the past six years modernizing their shipbuilding and repair capacity. But industry sources say more investment and more orders are needed urgently. Several shipyards have either closed or converted to more generalized industry to survive in a tough climate.

"The Canadian shipbuilding and ship repair industry is a technology-based and specialized skills-oriented field using the products of numerous Canadian companies from steel mills to advanced information technology," the Shipbuilding Association of Canada said.

"Canadian shipbuilders have a well-deserved reputation for producing quality products. Shipbuilding is a high-technology industry driven by computerization, complex design capability, and automated production equipment. Canadian shipyards are modern."

Both government and industry also see enhanced earnings potential from increased exports abroad. "Canada's marine industry is a key economic driver and the lifeblood of many communities from coast to coast," Industry Minister Tony Clement said. "This Government is taking the opportunity to seriously look at a new approach to shipbuilding procurement, one that will engage industry in an open and frank manner."

"This Government is providing the men and women of our Canadian Forces and Canadian Coast Guard with top-of-the-line equipment, while ensuring Canadian taxpayers get the accountability they expect and deserve," Minister of Public Works and Government Services Christian Paradis said.

"Today we are building on our long-term relationship with domestic shipbuilders so they can continue to deliver and support our Canadian fleet," he said. Canadian law requires all government ships to be built at domestic shipyards.