Council Working Party on Shipbuilding (COUNCILWP6) H.E. Per Egil Selvaag

1. What is the mission and mandate of your Committee?

The mission of the OECD Council Working Party on Shipbuilding (also called WP6) is to contribute to establishing normal competitive conditions in the global shipbuilding sector. As a Part 2 Committee, the WP6’s Mandate is renewed every five years and puts forward two intermediate objectives of the WP6 which are to:  Increase transparency and improve the understanding of the shipbuilding market, including supply and demand, economy-level policy settings, and international and inter-industry linkages;  Contribute to a business climate that enables growth and innovation in the shipbuilding industry.

This contributes to a wider OECD strategic objective of promoting sustainable economic growth, financial stability and structural adjustment.

2. You have been designated Committee Chair. What is your background and what has convinced you to take up this post? How do you consider your background and experience contribute to such a role and function?

I am a career diplomat, with an educational and practical background in trade policy issues, which I have found to be a useful background for someone chairing the Shipbuilding committee, given that much of the work aims at creating a level playing field in the sector. An important factor for taking up this position was the support from other members for me chairing the committee.

3. What is your main priority as Chair?

My priority is to facilitate the work of the WP6 so that it can fulfil its mission and Mandate. This involves facilitating agreement among members and looking for possibilities for the committee to have impact on as larger a share of the global shipbuilding market as possible.

4. How would you define the added value of your Committee in relation to the work of the OECD in an international context? How does it differ from other international fora dealing with the same topic?

The value-added of the WP6 is notably to bring together government representatives responsible for the shipbuilding industry in their countries as well as shipbuilding industry representatives. The WP6 is the only forum which provides this international platform for the exchange of information as well as the elaboration of economic and policy analysis on several aspects of the shipbuilding sector. Other fora dealing with the Shipbuilding industry have different missions; for example, the International Maritime Organization (IMO), which is a United Nations specialized agency, deals with the safety and security of shipping and the prevention of marine and atmospheric pollution by ships.

The WP6 maintains close working relationships with other relevant bodies of the OECD to complement and support WP6 work, in particular including those working on export credit issues as well as other organisations notably the IMO and the World Trade Organization (WTO), with a view to increasing synergies, avoiding duplication and supporting sound development of both global shipbuilding industry as well as international trading system and its rules.

5. Are you facing any specific major challenge derived from the current multilateral environment?

The global shipbuilding industry faces serious challenges including excess capacity and market distortions notably due the subsidies supporting the industry in some countries. Stakeholders in the industry have various views on how to address these challenges. The WP6 was created in 1966 and tried several times to develop a multilateral shipbuilding agreement (SBA) notably in 1995, 2002-2005 and a shipbuilding instrument in 2017-2019 to possibly put in place an international discipline on subsidies and injurious pricing in the shipbuilding sector. These trials were unsuccessful because the 1995 SBA was not ratified by all parties, and in the following trials, WP6 members and other interested shipbuilding economies did not reach an agreement. The WP6 facilitates the discussions between major shipbuilding economies and contributes to the initiatives to improve the multilateral dialogue on the international trading system.

6. How do you encourage, and ensure national experts engage productively in the work of your Committee?

As WP6 Chair, I encourage the active participation of delegates from all WP6 members, associates, participants and invitees during WP6 meetings. Moreover, several projects conducted by the WP6 are based on the inputs by countries for instance the WP6 inventory of support measures, various surveys sent to WP6 delegations as well as a questions & answers session in which delegations reply to written questions sent by other WP6 members.

7. How do you help maximise policy coherence through the work of the Committee?

We have procedures in place to ensure that the reports prepared by the Secretariat are in line with the key reference documents such as the WP6 Mandate and the WP6 Programme of Work and Budget. I have meetings with the Secretariat before WP6 meetings to discuss the draft reports, the substance in documents prepared by the Secretariat is discussed during WP6 meetings and subject to written comments by WP6 members.

8. How do you ensure effective decision-making by the Committee?

The Secreatariat and the Bureau try to prepare the formal meetings of the WP6 with a view to facilitate effective decisionmaking by the Committee. Sometimes, contacts with and/or between delegations ahead of meetings are useful. Even if we are not successful in paving the way for quick agreement in the formal meeting, we get a feeling of what issues may be worth spending time on in the meetings, and which issues that are not mature for agreement, and perhaps not worth spending a lot of time on in the formal meeting.

9. Could you mention the most important documents/reports that the Committee/Group has issued in the last 2 years? Why are these important and what has been their impact?

The WP6 has in the last two years issued reports on Shipbuilding policy and market developments in selected economies (September 2021), State-owned enterprises in the shipbuilding sector (February 2021) and on China’s shipbuilding industry and policies affecting it (April 2021). These reports have contributed to a better understanding of the global shipbuilding industry and policies affecting it in selected non-OECD countries which are significant shipbuilding economies. The reports are

quoted in other publications and contribute to the international debate on a sound development of the international shipbuilding industry.

10. How can you encourage synergies between policy communities?

The WP6 has organised workshops in which we have invited representatives from other international organisations including the IMO, the WTO and UNCTAD. Moreover, the Secretariat has regular contacts with representatives from other international organisations, as well as various government representatives to collect information and get their comments on draft reports. The participations of representatives from the OECD Secretariat serving other committees is also encouraged, so that synergies between them and the WP6 are facilitated.

11. How do you see the role played by the Secretariat?

The Secretariat drafts and presents the reports that are included in the WP6 PWB. Moreover, the Secretariat organises the WP6 meetings, workshops and other events.

The Secretariat also assists me before and during meetings so that I am able to chair WP6 meetings efficiently. Good cooperation between Chairs and the Secretariat is, as I see it, a key success factor for the efficient functioning of OECD committees.

12. In relation to the standard-setting role, what do you suggest to maintain the relevance and impact of OECD standards over time? Which areas need strengthening?

There are several instruments maintained by the WP6. The Revised General Guidelines for Governmental Policies in the Shipbuilding Industry and the Revised General Arrangement for the Progressive Removal of Obstacles to Normal Competitive Conditions in the Shipbuilding Industry include important principles in terms of policy recommendations but are not legally binding. The Sector Understanding on Export Credits for Ships is also maintained by the WP6 Secretariat in cooperation with the Trade Directorate. These instruments are important and contribute to the standard-setting role of the OECD. Standards are clearly important for the OECD to have relevance in a subject area. And lack of progress in the work on standards and instruments, or a lack of adherence to non-binding standards, means that a Committee does not reach its full potential.

The WP6 has on several occations explored the feasibility of establishing a new shipbuilding instrument, so far without success. Even if such a process is useful to understand the areas where there are diverging views, the OECD would have become more relevant had the efforts succeeded.

13. How have you ensured a contribution of your actions or influence to continuous improvement within the Organisation?

Here it could perhaps be relevant to mention that as Chair of WP6, I contribute to surveys on important horizontal topics for the OECD for instance on the Programme of Work and Budget of the organisation. I hope that such inputs from Committee Chairs contribute to the continuous improvement of the OECD.

14. What are the practical implications of the work of your Committee/Group?

The WP6 keeps the lines of communications between competitors in the Shipbuilding industry open, and offers an arena for them to meet. The work under WP6 contributes to the transparency in the shipbuilding sector and to the exchange of views on the best practices to have better policies for a sustainable development of the shipbuilding sector.

There are many examples of reports declassified by the WP6 being used in the economic and policy debate, and contributing to a better understanding of the shipbuilding sector. In this way the reports raise awareness

about major challenges such as excess capacity and market distortions and about the OECD’s policy recommendations for dealing with these challenges.

15. What would be your key advice to a person taking up the post of Chair of an OECD Committee/Group?

Draw on the Secretariat, they are there to help you. Be accessible and at the service of members at all times. Look for opportunities to improve the situation within the area of your mandate.