South Korea: Shipbuilding industry urged to keep up restructuring efforts

(Image Courtesy: Hiexpat Korea)

South Korea’s top financial regulator on Thursday called on shipbuilders to keep up their restructuring efforts, saying that the recent recovery in orders may be short-lived amid a trade spat between Washington and Beijing.

Choi Jong-ku, chairman of the Financial Services Commission (FSC), made the remarks at a meeting to assess the situation of the shipbuilding industry earlier in the day.

“Despite a recent boom in orders, the shipbuilding industry is facing various risks, including a slow recovery in ship prices, fears of a trade dispute and a rise in steel prices,” the official said at the meeting.

The shipbuilding industry needs to continue its restructuring efforts to better cope with such risks, Choi emphasized.

Hit by low oil prices and a supply glut, South Korea’s shipbuilders have been struggling with heavy debts and declining orders for years. Creditors threw a multibillion-dollar lifeline to rescue Daewoo Shipbuilding & Marine Engineering Co. last year.

After years of struggling with the global downturn, the nation’s shipbuilding industry showed signs of recovery this year.

South Korean shipbuilders ranked at the top spot in the number of new ship orders received in July.

The nation’s shipbuilders won orders equal to 970,000 compensated gross tons (CGTs) to build 22 vessels, accounting for 48 percent of the total ship orders placed globally, according to the data compiled by global research firm Clarkson Research Services.

(Source: Yonhap)

Sews News, October 19

Baibhav Mishra
Author: Baibhav Mishra

Associate Editor, Sea News