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China production boost to increase share of global shipbuilding

CHINA is aiming to boost production at its shipyards to 50m dwt by 2011, up from 28.8m dwt last year, as Beijing attempts to garner more than 35% of the global shipbuilding market. The new production target was pinpointed as further details emerged about China’s shipbuilding stimulus package. Beijing has already encouraged banks and financial institutions to help support the country’s shipbuilders while calling on the yards to seek stock market listings to strengthen their cash reserves. But the central government has also laid down several long-term targets for the country’s shipbuilding sector including maintaining production growth, enlarging its global market share and advancing development of more sophisticated, higher value vessels. Among the specific targets are plans to cut the construction period for common ship types such as bulk carriers to less than 10 months. The stimulus package also urged shipbuilders to increase expertise in the offshore market, including floating production storage and offloading units, in a bid to raise their global market share to 10% in 2011. But observers had mixed feelings about the targets set under the package. China Changjang National Shipyard (Group) Jiangdong sales manager Kent Chen told Lloyd’s List that the package could do little to stimulate new orders. “The package might help shipbuilders clean up their existing orderbooks, but shipowners remain very cautious about making new orders.” But China Everbright Research transportation analyst Rick Leung gave a different view. “Chinese shipbuilders are able to meet the target because the policy intends to restructure the industry and steer the shipbuilders to high-end sectors.” The China Association of National Shipbuilding Industry was also confident the 2011 order target could be met. A spokeswoman said shipyards performed strongly, building a total of 9.8m dwt in the first four months this year.

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