Maritime industry remains a vital contributor to state economy: New report identifies “best practices” to ensure competitiveness

The Washington Maritime Federation has released a major report analyzing the state’s maritime industry. The report begins by highlighting the industry’s importance to the state economy.

Few states have benefited more from and rely as heavily on international trade than Washington.  At least 40 percent of the state’s jobs can be tied to trade-related industries. Export-related jobs for the state totaled 371,853 in 2013 and account for more than 30 percent of new jobs created in the past 30 years. Import-related activity is equally important, accounting for 277,477 jobs, an increase of 31.2 percent in just more than four years, according to a study by the Washington Council on International Trade.

The trade-dependent industries and jobs in the state depend on a well-integrated network of transportation providers and infrastructure that supports interstate, interregional and international connections. Washington’s ports are a major part of this network. The state’s deep-water and inland waterway ports and geographic location make Washington a natural gateway for U.S. consumer goods, agricultural products, and raw materials headed overseas as well as a wide array of imported parts, equipment, and resources critical to the American manufacturing sector. [Table references and footnotes omitted.]

As the report makes clear, there are significant challenges to maintaining the state’s favorable trade-related industry. The threats are both external and internal, stemming from the advances made by competitors and roadblocks originating with federal, state, and local policymakers. 

Successful competitors include ports in British Columbia and Savannah, Georgia, that have strong public-private partnerships, excellent infrastructure, and streamlined permitting. Washington, on the other hand, is seen as having acted to hinder port development.

..recent highly-publicized decisions regarding use of waterfront property in the state have created a perceived bias against maritime industrial uses, particularly in urban areas with many competing uses. For example, the Port of Seattle and Foss Maritime’s proposed use of Terminal 5 – which longtime Washington maritime company Foss said would create 400 new jobs – was opposed by the City of Seattle and many local of cials as it involved the maintenance and support of Shell Oil Alaskan drill rigs. Earlier this year, a proposed sports arena in a port industrial district in South Seattle also put pressure on maritime port uses in that region of the city. These efforts highlight the competitiveness issues that Washington ports face. The notion that it is more difficult to conduct business in Washington than elsewhere because of lack of public and government support for the industry can be detrimental to competitiveness.

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While as a policy the federal government and many states have attempted to rein in the length of time it takes to complete the infrastructure project permitting process, Washington has actually taken steps that can lengthen it. For example, in 2014 the Washington State Department of Ecology effectively broadened the State Environmental Policy Act (SEPA) permit review process to include a discretionary review component that analyzes the impacts of life-cycle greenhouse gas (GHG) emissions from transportation impacts – even those occurring outside the state.

The press release includes one of the co-authors’ statements of what’s at stake.

“The maritime sector is more integral to the survival of Washington’s economy than any other state in the nation,” said David Matsuda, former U.S. Maritime Administrator in the Obama Administration and co-author of the report. “But the Evergreen State’s historic role as a gateway to Pacific markets is a competitive advantage that can no longer be viewed as static in our increasingly interconnected world.”

To maintain the state’s competitive advantage the report recommends:

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Overall, the report’s authors are optimistic that Washington can continue to be a global leader in maritime trade. Yet, they add,

…the state cannot be complacent that its competitive advantages are permanent.

Other ports in North America – even as far away as the U.S. East Coast – are expanding capacity that will come as the United States strengthens its trade ties with Pacific nations. New competitive pressures in the global supply chain are present as businesses consider the less expensive or less controversial option of moving goods and materials around the world.

This is a crucial issue for our state. The Association of Washington Business carried an extended discussion in its Winter edition of Washington Business. 

Congratulations to the Washington Maritime Federation for producing a timely, comprehensive and thoughtful analysis of how Washington can maintain its leadership role in world trade.