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South Korea’s oceans and fisheries ministry said it will support the construction of more than 200 vessels that comply with IMO regulations by 2020 over the next three years. They will focus on the construction of ships that use LNG as fuel.
The aid will be made through the State Agency for the Promotion of Maritime Business Korea Oceans Business Corp. (KOBC). We remind you that KOBC is made up of the following state agencies: Maritime Information Exchange Center, KSmart and the Maritime Guarantees Insurer.
One of the key factors behind this decision is the need to renew the national fishing industry that still uses obsolete technologies. Minister Kim Young-choon commented that the sector will be reviewed from the management of marine resources to production, distribution and consumption.
Although orders for new vessels granted to South Korean shipyards have increased, this growth needs to be sustainable in the long term.
The chairman of the Financial Services Commission (FSC), Choi Jong-koo, commented that the order book of the national shipyards had increased 29.8% in September, 45% more than the one registered a year ago. However, he points out that we still do not know if it is punctual or it will remain that way in the long term.
According to Yang Jong-seo of the World Economic Research Institute, this increase is a consequence of the LNG transport sector and the increase in the order book of Hyundai Merchant Marine. In total, estimates that South Korean shipbuilders will account for 11 Mcgt, 50% more than last year, or what would be equivalent to 25.4 billion dollars, 48% more than in 2017.
The Yonhap news agency reported that the government is considering a $ 706 M injection to Hyundai Merchant Marine Co. to help the shipping company overcome the increasing losses. The company’s largest shareholder, the Korea Development Bank, and the KOBC are reviewing the purchase of bonds for 400 billion won each.
Hyundai Merchant and the government are of the same opinion that the capacity of the company should increase by one million teu by 2020 to ensure its competitiveness. The nation’s three major shipbuilders, Hyundai Heavy Industries Co., Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co., have been forced to undergo extensive rescue programs worth 11 billion won since 2016.
Source: Sector Maritimo