The maritime industry is comprised of a variety of companies. These companies’ activity includes supplying products and services to the various maritime segments. This industry includes all enterprises which engage in multiple different businesses including; designing, constructing, manufacturing, acquiring, operating, supplying, repairing, vessels. One of the countries that rely heavily on the marine sector is Canada. The small, domestic economy has many limitations of which Canada relies heavily on the link that the marine industry provides between their consumers and producers.
The United States imports from Canada was accounted for by marine transportation for almost a fifth of the volume and over 95 percent of the millions of commodities and processed goods back in 2003. Grain, iron ore, and coal are domestic commodities that play vital roles in Canada’s trade. These items are transported from Canada to the U.S. via the Great Lake ports. Crude oil is shipped from the Terra Nova oil field. This field is located just off Newfoundland’s coast. For commodities such as these as well as other domestic goods, Canada utilizes merchant fleets to take care of suck trades. These trades are often dry bulk carriers. Tankers, general cargo vessels, tugs, barges, and ferries are all included in the dry bulk carrier category.
The marine sector does not only provide the transportation of goods, but also passengers. Private firms benefit the Canadian economy as well as federal Crown corporations which operate ferry services for passengers. These passengers can consist of firms and workers that provide services to the cruise vessels. The output and employment opportunities that this industry brings to Canadian economy are two more great additions as to why this industry is so important. Marine transport generates activity. Goods and services supplied by firms are also positively affected by this.
It is easier to estimate economic impacts than most people believe. We must first understand the different type of impact to understand how the marine activities impact the economy. Through direct impact, workers experience higher wages which leads to profits of the firms within the marine transport sector. Indirect impact is achieved for firms which supply materials and services. These goods are supplied to marine transport industries which then passes on the effect to their suppliers. As water transport provider demands go throughout the production chain, we then experience the next form of impact- induced impact. Induced impact is achieved through the income flows. Expenditures also play a role in this and results as both direct and indirect impacts which then reflect back on the economy.
The marine sector generates more than just what was mentioned above. One of the key things to remember when analyzing the marine sector is the high paying jobs it generates. Wages are paid by firms within the marine sector. These firms are typically above the Canadian industrial average. The high earnings of workers are solely because of high productivity from the workers themselves. Operating revenue per employee includes other sectors as well as transport industries. Labor productivity may also benefit from these developments which also include mergers and consolidations within the marine industry. The income that the marine sector contributes to government revenues is a significant amount. This income that is generated rises income and corporate tax payments. These two things quickly boost government revenues. It is also important to take into consideration the impact this has on taxes and benefit payments. Marine activities were reported to increase federal government revenues in Canada.
Overall, it is important to understand the great impact that the marine industry plays on economy as a whole. It creates jobs and also improves the government revenue significantly.