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Building more ferries in BC would benefit the local economy: report

The economic benefits of building new ferries in British Columbia are so large that more needs to be done to encourage local construction, says Columbia Institute Executive Director Charley Beresford.

The institute released Made-in-BC Ferries: The Economic Benefits of Local Ship Procurement, authored by labour researchers Blair Redlin and David Fairey using economic analysis from Ernie Stokes.

"All we're saying is there's the possibility here," Beresford said. "So what can be done to work with that possibility?"

The report finds that for every 100 jobs created building or repairing ships, a further 135 jobs are added to the provincial economy. It would also increase provincial tax revenues by $36 million and federal revenues by $66 million.

BC Ferries is currently seeking a builder for three intermediate class vessels. Seaspan Shipyards had been in the running, but withdrew two weeks ago after winning a $15-million contract to build a smaller cable ferry to serve the Vancouver Island to Denman Island route.

"We are rebuilding the shipbuilding industry here in B.C. and in Canada and long term the outlook is very positive – this near term opportunity would be a little irresponsible for us to take on at this time," CKNW radio quoted Seaspan Shipyards head Brian Carter saying. The shipyard won't be available to build more BC Ferries until 2019, he said.

The shipyards still in contention to build the three new ferries are in Norway, Poland, Germany and Turkey. The CKNW story notes that all Canadian shipyards were invited to bid on the project.

Building those three ships in B.C. would have added $378.5 million to the provincial economy, according to the Columbia Institute report.

BC Ferries is planning to replace 26 vessels over the next 15 years, said the report, which notes the controversy over past decisions to build ferries in Germany. "If BC Ferries decides once again to build the new intermediate class vessels offshore, it is likely to the detriment of [the] long term vision," it said. "Building these vessels overseas may undermine the future ability of BC shipyards to bid on the 23 other vessels that Captain Marshall says will be put into service over the next 15 years, as the opportunity to develop and maintain specialized capacity for ferries may be lost."

The report suggests pacing the construction of new vessels so as to keep shipbuilding in B.C. sustainable long into the future. "One option would be to pursue a more gradual fleet renewal strategy that extends the service life of existing vessels in order to appropriately time new construction when capacity is best available in local shipyards," it said.

Beresford said doing things like awarding points for local construction in bidding processes could also help keep the work local.

There's a long history of building ships in the province, creating good jobs that diversify an economy that still largely relies on resource extraction, she said. "Here's one area that might be a bright spot," she said. "It's about hope."

Andrew MacLeod is The Tyee's Legislative Bureau Chief in Victoria. Find him on Twitter or reach him here.

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