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June 2012www.marinelink.com 51Joonkoo Lee, Ph.D.is a postdoctoral re- search scholar at the Duke University Cen-ter on Globalization,Governance and Com-petitiveness (CGGC).His research at CGGC focuses on oceantechnology value chains and global agri-food value chains. He is a co-author ofthe Nova Scotia Ocean Technology re- port from which excerpts were taken for this article. He received his Ph.D. in So- ciology at Duke University in 2011. Leecan be contacted at[[email protected]].Lukas Brunis a sen-ior research analyst at the Duke UniversityCenter on Globaliza-tion, Governance &Competitiveness(CGGC), and co-au-thor of the Nova Sco-tia Ocean Technology report from which excerpts were taken for this article. He has more than 10 years of experience in economic analy-sis and economic development-related contract research. Brun can be con- tacted at [[email protected]].Nova Scotia in the shipbuilding value chain. Nova Scotia?s firms are particularly strong in the high value-added portions of the shipbuilding value chain, specifically navigation, electronic and communica- tions equipment sub-systems, and ship-building engineering and support services, including integrators. Federal shipbuilding projects: The presence of this large-scale, long-term federal project in Nova Scotia will pro- vide several benefits to the Nova Scotia shipbuilding sector. First, it will ensure a steady demand for shipbuilding for an ex- tended period. Most of the smaller ship-building sectors outside East Asia, due to unstable demand, tend to suffer from the frequent loss of accumulated local infra-structure and skilled labor. NSPS will en- sure long-term stability in shipbuilding in Nova Scotia. Second, the project will gen- erate new investments in the region. ISI has already invested C$90 million in the past few years in expanding its infra- structure, and the company is expected to invest tens of millions of additional dol- lars as the largest portion of the NSPS program develops. It will help upgrade infrastructure andstimulate employment across the region. Finally, NSPS will help the region attract large and small firms, skilled workers, and engineers from other Canadianprovinces and foreign countries, making the region?s shipbuilding and OT cluster diverse and dynamic. A number of opportunities exist for Nova Scotia?s companies in the global markets for shipbuilding and OT value chains. Although Nova Scotia does not account for a large percentage of Cana- dian ship exports relative to Quebec and Ontario, it is well-positioned to take ad- vantage of three opportunities in the ship- building sector. (See Table 1, previous page.) First, the increasing importance of mod-ularization and high-tech systems offers companies in Nova Scotia opportunities to enter into global shipbuilding supply chains. Emerging economies are good candidates for expanding Nova Scotia?s exports, particularly to countries experi- encing recent growth in trade, oil produc- tion, per capita income, or requiringenhanced security of their ports and terri- torial waters, notably Indonesia, Turkey, Vietnam and United Arab Emirates. These countries are keen to develop local shipbuilding but not yet capable of devel- oping integrated high-tech systems, to which Nova Scotia firms can contribute. Second, the increasing demand for Arctic vessels presents new opportunities to Nova Scotia firms. Refitting ships for Arctic conditions, in particular, appears a promising activity for firms in Nova Sco- tia, and the province has several compa- nies already active in this business. In addition, Nova Scotia companies could find opportunities to collaborate with East Asian shipbuilders. East Asian ship- builders, compared to their Northern Eu- ropean peers, are not particularly strongin harsh climate technology and research.As they attempt to upgrade into high value-added ships, such as icebreakers, they are requesting R&D and technology assistance from Canada. Internationalpartnership could provide opportunities for firms and researchers in Nova Scotia to participate in large commercial projects oriented to global markets. Third, a rapidly changing environment in energy demand and use can provide new market opportunities for Nova Scotia firms. As one of Canada?s major offshore oil and gas industry bases, Nova Scotia can benefit from the need of the growing offshore oil and gas sector for specialized ships, such as platform service vessels and anchor handling tug supply vessels. Furthermore, as environmental standards tighten in the marine sector, there is a growing demand for energy-efficient ships or ships that use alternative sources of energy. This latter opportunity will in- troduce a new area for technological in- novation in ship design and building. MR June12 # 7 (50-56):MR Template 6/11/2012 1:21 PM Page 51