LONDON risks losing its crown as the world’s biggest shipping centre in the face of aggressive overseas competition, according to a hardhitting new report.

Shanghai, Singapore and Athens are all actively building maritime services hubs. For the time being London remains the world’s most important centre for ship broking, legal services and insurance. But it could cede its pre-eminent position in as little as ten years.

Threats to London include possible reforms to nondomicile tax status, under which wealthy foreigners living in the UK do not have to pay tax on their overseas income. A change would encourage Greek ship owners, the backbone of the UK shipping community, to desert London.

New York lost its foreign ship-owning community after abolishing favourable tax status. The British Government has yet to end uncertainty over the non-domicile tax issue.

The maritime services sector provides more than 14,000 jobs in London and generates more than £1 billion in net overseas earnings for the country. Maritime London, the promotional body that commissioned the report, said action was needed to prevent further attrition. Ship ownership and trade is shifting to the Far East, strengthening ports such as Shanghai, Singapore and Hong Kong. Each has the advantage of low costs and good infrastructure.

Richard Sayer, chairman of Maritime London, urged the Goverment to do more to support British maritime services. He said: “A number of foreign countries are putting a lot of weight behind promoting their own maritime centres and we would be foolish if we ignored that.”

A Maritime London spokesman said: “Something like 40 per cent of the world’s ships are owned in the Far East. London is still at the centre of things but people inevitably go nearer their clients.”

He added: “It’s a changing world and London has to get out there and actively market itself, not just complacently expect the situation to remain the same.”

In Europe, competitors include Piraeus at Athens, which has made huge improvements to its communications infrastructure. London’s Greek shipping community is increasingly relocating technical and ship management activities there.

Nearly 60 per cent of those surveyed said London would no longer be the world’s pre-eminent maritime services centre in 10 to 20 years. Many cite the development of regional centres similar to London located where physical demand is growing and where the public sector is creating the right conditions.

London benefits from a cluster of maritime services, which includes the Baltic Exchange. Pressures include high property and high salary costs.

Options for London include developing a wider perception of itself as a national maritime services cluster, calling on expertise from Southampton, Glasgow and Liverpool. Their lower cost bases could help to see off the threat from cheaper overseas competitors.