China: Fast-growing maritime industries become new economic engine

Fast-growing maritime industries become new economic engine
Ni Hongzhang 2019/5/5 http://www.globaltimes.cn/content/1148546.shtml

In 2018, China's total maritime economy reached 8.3 trillion yuan ($1.2 trillion), surpassing Mexico's GDP that year and ranking 15th in the world for maritime economy size. China has become one of the world's major maritime economies after years of development. However, compared with developed countries, China still has a long way to go to become a leading marine power.

China's fast-growing maritime industries have become a new engine of the country's economy. The total output value of China's marine economy in 2018 grew 67 percent year-on-year, accounting for 9.3 percent of the total GDP and creating 36.89 million jobs, according to a report released by the Ministry of National Resources in April.

The maritime economy has doubled every six years on average from 2001 to 2018, accounting for more than 9 percent of the total economy for 10 consecutive years, He Guangshun, director general of National Marine Data and Information Service in the Ministry of Natural Resources, said at the release conference of the report.

It increasingly plays a role as an engine of China's economy, He noted.

Liu Ming, a research fellow with the China Institute for Marine Affairs under the Ministry of Natural Resources, told the Global Times that China's total maritime economy is expected to approach 9 trillion yuan by 2020 and reach 13 trillion yuan in 2025. China's maritime economy will continue to grow until 2030.

The contribution of China's marine economy is enormous, both in terms of economic growth and employment, said Wang Hong, director of the State Oceanic Administration in March.

Significant potential

China's more than 3 million square kilometers of ocean does not just drive domestic growth but also plays a big role in promoting opening-up, Lin Qi, an assistant research fellow with the National Institute for South China Sea Studies, told the Global Times.

It's necessary for China to strengthen maritime economic development to meet downward challenges from the economy and rising protectionism, Lin said. "The importance is beyond question."

Describing the ocean's significance to China and mankind, Jin Xianglong, a Chinese Academy of Engineering member, said at the Boao Forum on March 27, "The ocean is the cradle of forests, the regulator of climate, and the treasure house of resources."

According to the data provided by Jin, the ocean contains 70 percent of fresh water that humans could rely on when freshwater resources are depleted. And ocean life provides 600 million tons of protein to humans every year, accounting for 22 percent of overall demand. The rich oil and gas deposits under the sea bed account for 45 percent of total global supply.

However, exploring the ocean has become a common choice among countries to bolster the economy, given that 152 out of the world's 200-plus countries and regions are coastal states.

As the supply of land resources has grown increasingly tight, major countries have all accelerated their exploration and use of deep sea, distant water and polar maritime resources, Lin said.

"The international competition for marine resources and ocean space is increasingly fierce," said Lin.

Marine economy industries involve engineering equipment manufacturing and resource exploration and development, which are related to China's sovereignty and interests and China's status in the international community, Lin added.

According to the relevant provisions of the United Nations Convention on the Law of the Sea, China has jurisdiction over a sea area of roughly 3 million square kilometers.

Li Jun, deputy Party secretary of Hainan Province, frequently corrects people's mistaken impression that Hainan is a small province. During the Boao Forum, he said that although the land area of Hainan is just 35,000 square kilometers, its ocean area is 2 million square kilometers.

"We are a big province. Hainan's future is in the ocean," Li said.

The maritime economy has become an inevitable choice for China's economic development as land-based industries have developed, Yin Zhongqing, the deputy head of the Financial and Economic Affairs Committee of the National People's Congress, said during the Two Sessions.

In the new era, it is necessary to explore and develop the ocean so as to open up new space for development, foster new economic industries, build new engines for growth, and realize sustainable development, Yin said.

Inevitable choice

Although China's maritime economy ranks 15th in the world in size, it is still not strong enough.

According to a report released by the Ministry of Natural Resources in December of 2018, compared with developed countries' maritime development, China's maritime economy still remains at a relatively low level.

"We should clearly understand that we are just a large maritime economy, not strong yet," said He from the Ministry of Natural Resources during the Two Sessions.

He noted that China's marine industries such as marine fisheries, transportation and offshore equipment are among the highest level in the world. But compared with the UK, the US, Germany and other developed countries, China's marine resource utilization efficiency is not high, mainly relying on traditional industries.

The proportion of emerging industries is relatively low, and some industries still have difficulty using technology in production, financing, and gaining profits, He said, adding that "the overall power of China's maritime economy is still in the developing phase."

Major maritime powers such as the US, UK, Japan, Canada, and Australia are in leading positions in terms of national legislation, policies, strategies, and social education, publicity, environmental protection, and development level, Lin told the Global Times.

During the Two Sessions, Yin pointed out the weak link of China's maritime economy, saying much of the local maritime economy is just focused on the coast and in territorial waters offshore, and doesn't attach enough importance to distant waters and the deep sea.

The maritime economy faces major challenges in upgrading industry and structural adjustment, Yin said, adding that traditional industries are overdeveloped, while development of marine emerging industries, strategic industries and high-tech industries is far from enough.

Yin also noted that the marine ecological environment is under pressure and the pollution situation in the offshore area is relatively serious.

According to data from the Ministry of Natural Resources, China's marine emerging industries and strategic industries, which lag behind those of developed countries, have seen an average yearly growth rate of 24 percent, but their proportion in the overall economy remains fairly low, accounting for less than 5 percent.

Speaking of marine environment conservation, Liu told the Global Times that among the 44 large- and mid-sized bays with coastal area exceeding 100 square kilometers, nearly half of them experience poor water quality every year.

China's sea-related legal system is not completed, and there is still not comprehensive marine legislation in China, Lin said.

"The lack of legislation will lead to irrational development of marine resources, backward marine technology innovation, and destruction of the marine ecological environment. It needs to be improved," Lin added.