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Shipbuilders to set sail at home
( 2002-01-29 10:53 ) (1 )

Chinese shipbuilders are excited that domestic demand for new vessels remains strong.

Li Changyin, general manager of China Shipbuilding Industry Corporation (CSIC), one of the nation's leading shipbuilders, said on Monday that the company would therefore focus more on the domestic market in the coming years.

"There is great market potential at home that we can tap," Li said.

An official with China State Shipbuilding Corporation (CSSC), another shipbuilder, said acquiring many domestic orders is his company's priority this year as well.

Li said demand would likely come from ocean ships, offshore crude oil carriers and ships for liquefied natural gas and liquefied petroleum gas projects along China's coastal areas.

Demand for new ships by the nation's three largest shipping firms -- China Ocean Shipping Co, China National Foreign Trade Transportation Group and China Shipping Company -- will likely reach a total tonnage of 10 million between 2001 and 2005, the general manager said.

The vast majority of the two shipbuilding giants' orders in recent years has come from the foreign market.

Li said CSIC had orders with a total tonnage of 3.9 million last year, 73 per cent of which were for exports.

The CSSC official said it had orders with a total tonnage of 2 million last year, of which 1.7 million came from the foreign market.

Although attention is now turning inward because of sluggish demand in the world market and increasing competition there, "we will not give up on the world market," Li said.

The CSSC official said his company would also speed up its efforts to explore European markets, especially Russia.

Dong Yangfan, a CSSC analyst, predicted that the world shipbuilding market would barely recover this year because of the lingering world economic slowdown.

"The world's demand for new ships will increase by no more than 5 per cent this year," Dong said.

The tonnage of new vessel deliveries in the world amounted to 50 million last year, down from 70 million in 2000, he said.

China is the world's third largest shipbuilding country, following South Korea and Japan.

CSIC aims to win 1.4-million-tonnage in new orders worth 15 billion yuan (US$1.8 billion) this year, Li said.

The company also plans to double its shipbuilding capacity to 4 million tons by 2005 and increase its exports to more than US$1 billion by 2005 from last year's US$440 million.

CSSC said its goal is to increase its shipbuilding capacity by 100 per cent this year.

The two companies were established in 1999 as part of a reshuffling of China's shipbuilding industry.