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What
might feel like a global shipping meltdown will,
in hindsight, be viewed as a worldwide shift to
an Asian domination of the maritime industry.
Such was the conclusion of a recent shipping
finance forum in Tokyo.
Asia's determination to protect its shipbuilding
industries and to secure its means of supply
through nationally owned tonnage has destroyed
predictions that a lack of finance would
mitigate the impact of an over-exuberant
newbuilding market through cancellations.
FSL Trust Management president and chief
executive Philip Clausius told a gathering of
international shipping financiers that the
widely-predicted massive cancellation of the
orderbook will happen while state-owned Chinese
shipowners are being offered 17% subsidies to
soak up cancellations from foreign owners.
"Ship deliveries may be delayed a year or so.
They may not go to the original owners, but they
will come. And the massive oversupply hangover
will not go away any time soon," he said.
In a
similar vein, Marine Money Asia's financial
analyst Rodericks Wong pointed to the speed of
Asian governments, primarily in South Korea and
China, in initiating larger financial stimulus
packages than elsewhere to support both their
domestic shipbuilders and owners. This was a
leading driver that would shift the balance of
shipowning primacy eastward, he said.
Since the beginning of 2009, South Korea had
offered in excess of Won23trn ($18.2bn) in the
form of guarantees or direct finance through
buy-and-leaseback arrangements to ensure that
domestic orders did not slip into the hands of
foreign owners at rock bottom prices, Wong said.
HSH
Nordbank senior economist Mattias Umlauf said
the global reduction in bank capitalisation
outside Asia had led to China's banks taking the
top three places as the richest source of debt
financing.
China has made no secret of the fact that it
intends to secure the supply of natural
resources through the development of its own
transport. This was reinforced by the sting of
exorbitant shipping costs incurred through the
dry bulk boom in 2007-2008.
China's Export-Import Bank has provided $22.5bn
in support to the local state-owned shipbuilding
industry since 1994 and more recently offered
$3.7bn to private shipbuilder Jiangsu Ronsheng.
As Western banks teetered on the edge of
insolvency, traditional global financiers in
Norway and Germany would retrench, offering what
credit they had to their domestic owners under
the direction of their respective governments,
with Greek owners suffering the biggest impact.
Source: Motor Ship
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