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BIZCHINA> Top Biz News
China shipbuilders to get a leg-up
By Jiang Wei and Tong Hao (chinadaily.com.cn)
Updated: 2009-02-11 20:50

China's State Council, or the Cabinet, on Wednesday approved a stimulus package for the country's shipbuilding industry in a bid to help the emerging sector weather the global economic downturn.

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The government will encourage financial institutions to expand financing to purchasers of ships and extend fiscal support for domestic buyers of long-range ships until 2012. The country will also support the industry in technology upgrade, the State Council said.

Guo Yalin, an analyst with CITIC Securities, said the stimulus package gives a boost to an industry that has been facing difficulties in getting new orders and retaining old ones.

New orders for domestic shipbuilders are expected to drop to 20-30 million deadweight tons in 2009, compared to 58.18 million deadweight tons in 2008, the China Association of National Shipbuilding Industry had said earlier this week.

Buyers' defaults and requests to delay deliveries are both increasing, the association said. Cancellation of orders and delays in payment will also be on the rise this year if the market remains grim, the association predicted.

"The supportive measures in financing will help cut cancellations by buyers," Guo said.

The stimulus plan came after similar packages were green-lighted for the auto, steel, textile and equipment manufacturing sectors.


(For more biz stories, please visit Industries)

 

 

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