B.C. Missed an Economic Opportunity by Importing New Ferries From China, Rather than Building them Here

BC Ferries recently announced a purchase of four major new vessels from a shipyard in China. This decision has sparked criticism from trade unions and others, who argue the ferries should have been commissioned from domestic shipyards.

New research from the Centre for Future Work confirms that the decision to import the ferries, rather than domestic procurement, imposed a significant foregone economic cost on the province.

Sourcing an equivalent value of shipbuilding from domestic yards would generate $1.5 billion in additional GDP in Canada (85% of that in B.C.), over 10,000 person-years of employment, and would return over $400 million in additional revenue to government coffers (providing a financial basis for public support for future procurement).

The report reviewed the current scale of shipbuilding in B.C. and Canada, highlighting the strong employment growth in the sector over the past 15 years (largely due to a pro-active procurement strategy for Navy and Coast Guard ships from the federal government). It reviewed the role of active industrial policy in supporting shipbuilding in other major producers – including the U.S., China, and Europe.

It also surveyed the current capabilities of B.C.’s shipbuilding sector, identifying gaps that should be addressed in order to ensure the industry can source future ferry procurement from the provincial ferry operator.

The report concluded with several recommendations, including:

1. Establish a Ministerial-level task force to coordinate the development and implementation of a robust provincial shipbuilding strategy.
2. Amend contractual and fiscal arrangements with BC Ferries to require the firm to maximize economic benefits from domestic procurement of future vessels.
3. Commitment to accelerate the electrification of ferries, and development of B.C. technological and industrial expertise in electric vessels.
4. Formation of a consortium of firms to organize and plan the expansion of future shipbuilding capacity in B.C.
5. The provincial government should be prepared to take equity stakes in future ventures.

1. A strong marine sector workforce development strategy to ensure a steady and adequate supply of skilled workers for the shipbuilding and marine sectors.

Please see the full report, The Economic Benefits of Ferry Construction in B.C., by Jim Stanford, Blair Redlin, and David Fairey.

A video reviewing the main findings of the report, recorded during a public launch event, is available on the Centre for Future Work’s YouTube channel.

The report generated numerous media articles, including:

• Newspaper articles in the Vancouver Sun, the Toronto Star, and numerous other outlets.
• Television coverage on CHEK TV and other stations.
• A feature interview on the Jas Johal Show on CKNW Radio.