Troubled shipbuilding industry in China count on the Chinese government's direct financial support, saying that shipbuilders are pressured by financial difficulty with diversified payment system which would attract ship owners.
The Ministry of Industry and Information Technology of China (MIIT)'s recently reported '12th five-year economic development plan for ship engineering' notes that Chinese government would put more investment on science technology and develop mainly shipbuilding, ship repair, marine equipment and offshore facility industries with financing system.
In particular, the plan covers that the government would make shipbuilder-friendly financial product and service in cooperation with financial institutes and expand financing for shipbuilding-related companies.
Chinese shipbuilding industry player said that specific policy regarding exchange rate would be needed, such as using one currency in loan and repayment, etc.
China aims to increase annual sales by domestic shipbuilders to CNY1.2 trillion (US$189.7 billion) by 2015 as it works toward its goal of becoming the world's leading shipbuilding country, the Ministry of Industry and Information Technology said Monday.
China also plans to raise the value of annual shipbuilding exports to more than US$80 billion by 2015, the ministry said in a five-year plan for the shipbuilding industry.
The plan provides new details regarding China's push for significant growth in domestic shipbuilding at a time when the industry already faces overcapacity. A recent report by the China Association of the National Shipbuilding Industry showed that total new orders from more than 1,500 shipbuilders in China fell more than 50% last year. Shipbuilders have said demand for commercial ships will remain poor this year amid continued global economic weakness.
A central part of the ministry's plan for developing the sector is concentration of capacity. The plan calls for China to push forward with "structural improvements" to the industry, with the goal of 70% of the country's shipbuilding capacity concentrated among its 10 largest shipbuilders by 2015. The plan also says China should aim to claim at least five of the world's 10 largest shipbuilding companies by 2015.
"That's going to take some consolidation," said Matthew Flynn, managing director of Worldyards, a research firm. "At the moment, the top 20% of shipbuilders (in China) account for 63% of national capacity."
But Flynn said the sales targets, while aggressive, appeared achievable.
"They'll have to work hard to take orders in, considering the state of the shipping market. (But) this is doable assuming that the high yen keeps the Japanese somehow out of the market," Flynn said. Worldyards estimates China's existing order book for offshore and commercial merchant shipbuilding at US$109 billion, compared with US$140 billion for South Korea and US$41 billion for Japan.
The growth target would also require Chinese shipyards to continuously work to take market share from international shipyards, particularly in Korea, Flynn said. While Chinese yards will need to improve the quality and efficiency of new ships to appeal to a "buyer's market," they also stand to benefit from any appreciation of the Korean won, he said.
News came from the Management Committee of Shanghai Free Trade Zones that port of Yangshan was recently approved to be another pilot port of bonded registration of ship after Tianjin, which would push up the construction of the Shanghai International Shipping Center further. At present, total export-import volume through port of Yangshan is top among nationwide bonded ports.
The Maritime Safety Administration of Shanghai said that the establishment of bonded registration of ship, a system with Chinese characteristics, which set Yangshan as the port of registry, would reduce the operation cost of China fleets and improve their International competitiveness on ocean shipping effectively.
The world's shipping industry was unable to make headway on developing market-based measures (MBMs) to reduce greenhouse gas emissions, the International Maritime Organization said in a March 5 briefing following a week-long environmental meeting in London.
But the United Nations agency did make progress in other areas, including the adoption of guidelines to support next year's mandatory measures to improve ships' energy efficiency, guidelines on recycling of ships, and final approval of a number of ballast waster management systems, IMO said.
The IMO's Marine Environment Protection Committee (MEPC) met from Feb. 27 to March 2, tasked with steering the world's shipping industry closer to global consensus on reducing greenhouse gas emissions.
International shipping accounts for 870 million metric tons of carbon dioxide, about 2.7 percent of total global CO2 emissions, according to the latest IMO figures.
Key to the meeting was discussion on MBM proposals that would include a levy on all carbon dioxide emissions from international shipping or an emission cap-and-trade system, the IMO said in a Feb. 22 briefing previewing the week-long meeting.
Kyoto Dispute Overshadows Debate
As with previous MEPC meetings, the persistent stumbling block over MBMs was the insistence of developing nations that the concept of common but differentiated responsibilities that applies under the Kyoto Protocol be applied to the shipping sector, Peter Hinchcliffe, secretary-general of the International Chamber of Shipping told Bloomberg BNA March 5.
Under the Kyoto Protocol, the principle of common but differentiated responsibilities recognizes that developed countries are principally responsible for most of the current levels of greenhouse gases in the atmosphere—the result of a century and a half of industrial activity—and should therefore bear a heavier burden to mitigate emissions that contribute to climate change.
“The shipping industry is frustrated by the political polarization,” Hinchcliffe said. “We want to make shipping more [energy] efficient regardless of a ship's flag status.”
The ICS chief said the industry will have to be “patient with the politics.” But with the repeated stalemate that follows every previous MEPC meeting, Hinchcliffe questioned how the debate “is going to pan out in the future.”
The next IMO debate on MBMs will be at the MEPC's 64th session, slated to run Oct. 1-5.
Ballast Management Systems Approved
At the end of last week's meeting, MEPC granted basic approval to three, and final approval to five, ballast water management systems. The measures were aimed at minimizing damage caused by the ballast discharge, which can contain invasive alien species that ships transport from different areas, the IMO said in its briefing.
While MEPC said there were now 21 type-approved ballast management systems available for ships to test, Hinchcliffe said the majority of these systems were not commercially available and that scientists had underestimated the cost of introducing these systems into vessels.
Hinchclifee said he was relieved that delegations publicly questioned whether there were sufficient ballast water treatment technologies and shipyard capacity to ensure that countries are able to comply with the Ballast Water Convention when it finally comes into force. The convention requires ships to implement a ballast water and sediment management plan.
Energy Efficiency Guidelines
MEPC also adopted four sets of guidelines to assist in the implementation of the mandatory Regulations on Energy Efficiency for Ships in MARPOL Annex VI, which calls for the reduction of harmful emissions from ships.
The guidelines are expected to enter into force Jan. 1, 2013.
The four guidelines cover the method of calculation of the attained Energy Efficiency Design Index (EEDI) for new ships; development of a Ship Energy Efficiency Management Plan (SEEMP); survey and certification of the EEDI; and the calculation of reference lines for use with the EEDI.
EEDI is a nonprescriptive, performance-based mechanism that leaves to industry the choice of technologies to use in a specific ship design, as long as the required energy-efficiency level is attained, the IMO said.
SEEMP establishes a mechanism for operators to improve the energy efficiency of ships.
Separately, MEPC also adopted the 2012 Guidelines for Safe and Environmentally Sound Ship Recycling and the 2012 Guidelines for the Authorization of Ship Recycling Facilities.
An important series of guidelines to support the uniform implementation of mandatory measures to increase energy efficiency and reduce emissions of greenhouse gases (GHGs) from international shipping was adopted by the Marine Environment Protection Committee (MEPC) of the International Maritime Organization (IMO), when it met for its 63rd session from 27 February to 2 March 2012, at IMO Headquarters in London, paving the way for the regulations to be smoothly and uniformly implemented by Administrations and industry.
The MEPC also continued its intensive discussion on market-based measures for greenhouse gas emissions from international shipping.
During the busy session, the MEPC also adopted amendments to the International Convention for the Prevention of Pollution from Ships (MARPOL) relating to regional arrangements for port reception facilities; and adopted guidelines related to the implementation of the revised MARPOL Annex V (Garbage) and the Hong Kong Convention for the recycling of ships.
The MEPC also granted basic and final approval to a number of ballast water management systems that make use of active substances.
Guidelines for implementation of energy efficiency measures adopted
The MEPC adopted four sets of guidelines intended to assist in the implementation of the mandatory Regulations on Energy Efficiency for Ships in MARPOL Annex VI, which are expected to enter into force on 1 January 2013:
• 2012 Guidelines on the method of calculation of the attained Energy Efficiency Design Index (EEDI) for new ships;
• 2012 Guidelines for the development of a Ship Energy Efficiency Management Plan (SEEMP);
• 2012 Guidelines on survey and certification of the Energy Efficiency Design Index (EEDI); and
• Guidelines for calculation of reference lines for use with the Energy Efficiency Design Index (EEDI).
The guidelines adopted will support Member States in their uniform implementation of the amendments to MARPOL Annex VI Regulations for the prevention of air pollution from ships, adopted in July 2011, which add a new chapter 4 to Annex VI on Regulations on energy efficiency for ships to make mandatory the Energy Efficiency Design Index (EEDI), for new ships, and the Ship Energy Efficiency Management Plan (SEEMP) for all ships.
The EEDI is a non-prescriptive, performance-based mechanism that leaves the choice of technologies to use in a specific ship design to the industry. As long as the required energy-efficiency level is attained, ship designers and builders would be free to use the most cost-efficient solutions for the ship to comply with the regulations.
The SEEMP establishes a mechanism for operators to improve the energy efficiency of ships.
Finalization and adoption of the supporting guidelines was a significant achievement and also provides sufficient lead time for Administrations and industry to prepare.
The MEPC also agreed an updated work plan for the development of further guidelines and the development of energy efficiency frameworks for those ships not covered by the current EEDI regulations.
Technology transfer resolution debated
Linked to the implementation of energy efficiency measures was the draft MEPC resolution on the Promotion of technical co-operation and transfer of technology relating to the improvement of energy efficiency of ships, where it was agreed to further discuss the draft at the next session.
MBMs discussion continues
The MEPC continued its intensive consideration of proposed market-based measures (MBMs), which would complement the technical and operational measures already adopted. Further debate will continue at the next session (MEPC 64, 1 to 5 October 2012). The MBM proposals under review range from a contribution or levy on all CO2 emissions from international shipping or only from those ships not meeting the EEDI requirement, via emission trading systems, to schemes based on a ship’s actual efficiency, both by design (EEDI) and operation (SEEMP).
The Committee considered the undertaking of an impact assessment of the MBM proposals and considered in detail the methodology and criteria it should be based on. Towards the end of the meeting, the Chairman presented draft terms of reference for the impact assessment which will continue to be considered at the next session in October.
NOx technical code amendments adopted
The MEPC adopted amendments to the NOx Technical Code 2008, relating to engines not pre-certified on a test bed and NOx reducing devices.
MARPOL amendments MARPOL on regional port reception arrangements adopted
The MEPC adopted amendments to MARPOL Annexes I, II, IV, V and VI which are aimed at enabling small island developing Statesto comply with requirements for port States to provide reception facilities for ship waste through regional arrangements. Parties participating in a regional arrangement must develop a Regional Reception Facilities Plan and provide particulars of the identified Regional Ships Waste Reception Centres; and particulars of those ports with only limited facilities. The amendments are expected to enter into force on 1 August 2013.
A resolution containing Guidelines for the Development of a Regional Reception Facilities Plan was also adopted.
Resolution on sewage treatment equipment under MARPOL Annex IV adopted
An MEPC resolution was adopted on the development of technical onboard equipment in relation to the designation of the Baltic Sea as a Special Area under MARPOL Annex IV Prevention of pollution by sewage from ships, which calls for the development, without delay, of proven, adequate and cost-effective technical onboard equipment to make it possible to meet the discharge standards for passenger ships operating in special areas under that Annex.
This follows the adoption by MEPC 62 of amendments to MARPOL Annex IV to include the provisions establishing “Special Areas” under MARPOL Annex IV and designating the Baltic Sea as a Special Area under this Annex. Those amendments are expected to enter into force on 1 January 2013.
MARPOL Annex V guidelines adopted
The MEPC adopted the 2012 Guidelines for the Implementation of MARPOL Annex V and 2012 Guidelines for the Development of Garbage Management Plans. The guidelines are intended to assist in the implementation of the revised MARPOL Annex V Regulations for the prevention of pollution by garbage from ships, which was adopted at MEPC 62 in July 2011 and is expected to enter into force on 1 January 2013.
Recycling of ships - guidelines adopted
The MEPC adopted the 2012 Guidelines for Safe and Environmentally Sound Ship Recycling and the 2012 Guidelines for the Authorization of Ship Recycling Facilities.
These guidelines, along with the 2011 Guidelines for the development of the Inventory of Hazardous Materials and the 2011 Guidelines for the development of the Ship Recycling Plan that were adopted by MEPC 62, are intended to assist ship-recycling facilities and shipping companies to commence introducing voluntary improvements to meet the requirements of the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, which was adopted in May 2009.
The MEPC established a correspondence group to further develop the draft text of Guidelines for Survey and Certification under the Hong Kong Convention and Guidelines for Inspection of Ships under the Hong Kong Convention.
Ballast water management systems approved
The MEPC granted basic approval to three, and final approval to five ballast water management systems that make use of active substances, after considering the reports of the 18th, 19th and 20th meetings of the Joint Group of Experts on the Scientific Aspects of Marine Environment Protection (GESAMP) Ballast Water Working Group, which took place 2011.
The MEPC also adopted the revised Guidelines on design and construction to facilitate sediment control on ships (G12), one of the 14 sets of guidelines developed to assist in the implementation of the International Convention for the Control and Management of Ships' Ballast Water and Sediments, 2004 (BWM Convention). The revised Guidelines (G12) update the previous version adopted in 2006.
With regard to the availability of ballast water management systems, the MEPC noted that there were now 21 type-approved systems available. While some delegations expressed concerns regarding the implementation of the BWM Convention, due to lack of approved technologies, limited shipyard capacity, time availability and the costs involved, other delegations were of the view that there are sufficient ballast water treatment technologies and shipyard capacity and encouraged shipowners to start installing ballast water management systems on their ships in order to avoid possible bottlenecks at a later stage.
The Committee noted that there was consensus regarding the need for additional information on the implementation pace, availability of technologies and shipyard facilities and invited Member States to provide updated information regarding the status in their respective countries. A template was agreed to provide this information.
The MEPC reiterated the need for those countries that had not already done so to ratify BWM Convention, at their earliest possible opportunity, to achieve its entry into force. To date, 33 States, with an aggregate merchant shipping tonnage of 26.46 per cent of the world total, have ratified the Convention. The Convention will enter into force twelve months after the date on which not fewer than 30 States, the combined merchant fleets of which constitute not less than 35 percent of the gross tonnage of the world’s merchant shipping, have become Parties to it.
Amendments to the IBC Code
The MEPC approved draft amendments to chapters 17, 18 and 19 of the International Code for the Construction and Equipment of Ships carrying Dangerous Chemicals in Bulk (IBC Code), subject to MSC 90’s concurrent decision, with a view to adoption at MEPC 64.
Oil pollution response manuals approved
The MEPC approved a number of guidance manuals developed by the OPRC HNS Technical Group: IMO/IPIECA Guidance on sensitivity mapping for oil spill response; Guideline for oil spill response in fast currents; Operational guide on the use of sorbents; and Oil spill waste management decision support tool.
Polar Code – environmental aspects discussed
The Committee reviewed progress in the Sub-Committee on Ship Design and Equipment (DE) in developing the draft text of the mandatory Code for ships operating in polar waters (Polar Code), which is intended to cover the full range of shipping-related matters relevant to navigation in waters surrounding the two poles and the protection of the unique environment and eco-systems of the polar regions. It was noted that the intention was to develop an environmental protection chapter in the draft Polar Code.
Member States and international non-governmental organizations in consultative status were invited to submit relevant proposals related to environmental provisions proposed to be included in the Polar Code to the next MEPC session in October 2012, with a view to providing additional guidance to the DE Sub-Committee for its next session in March 2013.
The MEPC agreed that the Polar Code should be made mandatory thorough the adoption of appropriate amendments to the relevant annexes of International Convention for the Safety of Life at Sea (SOLAS), MARPOL, and other relevant environmental instruments.
Jiangsu province plans to bring an extra 90 million tonnes to its provincial cargo handling capacity by building 20 new berths this year, each with a capacity of 10,000 tonnes.
Among the 20 berths, six will be seaport berths, 14 will be along the Yangtze, which cuts through the province that borders on Shanghai.
Jiangsu province has unveiled a plan which includes investments of US$1.75 billion in port projects this year, mostly terminals of 50,000 to 100,000 tonnes, 4.5% more than last year.
The Federation of National Associations of Shipbrokers and Agents, (FONASBA), has given an enthusiastic endorsement to the newly released SALEFORM 2012 developed jointly by the Norwegian Shipbrokers Association (NSA) and BIMCO. SALEFORM is the shipping industry’s most widely used agreement for the sale and purchase of second hand ships. SALEFORM 2012 builds upon SALEFORM 93 retaining the accepted general principles and familiar structure.
Congratulating NSA, a Full Member of FONASBA, and BIMCO, a Club Member, on their actions to update the most successful sale and purchase agreement on the market, the President of FONASBA Christakis P. Papavassiliou from Cyprus said:
“At FONASBA we are pleased and proud to support publication of the revised NSF 2012, a document whose development reaffirms the position of NSA and BIMCO at the forefront of our profession. The enthusiasm and professionalism shown by these two FONASBA members in taking the updating project forward reflects this Federation's commitment to the maritime industry in terms of professional integrity and quality of
service. FONASBA fully endorses the revised SALEFORM 2012 and has already called upon its members in 49 countries around the globe to support it”.
Echoing the President’s comments, Marygrace Collins of the USA, Chair of the FONASBA Chartering & Documentary Committee and the Federation’s President Designate added:
“We are confident that the initiative taken by the NSA together with BIMCO will ensure that the NSF remains the premier document of choice for S&P transactions worldwide”.
China on Thursday called on the European Union (EU) to take seriously the concerns of the international community on its carbon emissions charges, warning the 27-nation bloc not to complicate the matter.
Chinese Foreign Ministry spokesman Hong Lei made the appeal at a regular press briefing in response to a question regarding the EU Commission's plan to impose carbon emissions tax on sea transportation from June this year.
"China, like many other countries, is firmly opposed to the EU's unilateral legislation on carbon tax," Hong said. "The truth is that the unilateral move is unpopular, and is unlikely to meet the EU's expectations."
He said the carbon tax issue on air and sea transportation should be solved within a multilateral framework through thorough consultation.
"[The settlement of the issue] should not be separated from the legal framework of the United Nations Framework Convention of Climate Change and the Kyoto Protocol. Meanwhile, it should not violate the principle of 'common but differentiated responsibilities' and fair spirit," the spokesman said.
Hong urged the EU side to commit itself to solving the matter instead of complicating it.
On Jan. 1 this year, the EU began charging airlines using EU airports for carbon emissions based on its Emission Trading Scheme (ETS).
Under the scheme, it is estimated that around 4,000 airlines will pay the EU for pollution permits, rendering the ETS one of the widest-reaching emission-regulative measures adopted by any country or regional bloc.
The move aroused strong opposition from many governments. A total of 29 countries signed a joint declaration in Moscow on Feb. 22 opposing the EU's carbon tax plan.
The declaration specifies a variety of measures intended to be used against the ETS, including allowing any country to introduce measures in line with national laws to either completely scrap the ETS or postpone it.
Vietship 2012 offers a good opportunity for local businesses to seek opportunities to develop the domestic shipbuilding industry and maritime transport, said Deputy Prime Minister Hoang Trung Hai.
He made this statement on February 28 at the opening of the sixth International Exhibition of Shipbuilding, Marine Technology, and Transportation (VietShip 2012) in Hanoi.
Deputy PM Hai said that the global economic downturn has directly affected the shipbuilding and maritime transport industry around the world, including Vietnam. Shipbuilding and maritime transport in Vietnam has also encountered many difficulties in terms of management, finances, and its technological capacity.
The Government has created a programme to overcome these challenges, restructure the country’s shipbuilding industry and devise a strategy to develop maritime transport in the future.
Accordingly to the plan, Vietnam will restructure shipbuilding businesses and create a healthy financial environment for them.
The Deputy PM said he hopes that international shipbuilders will become more involved in the restructuring to develop an advanced shipbuilding and maritime industry.
He emphasized that if all the countries cooperate, the global economy will see a strong recovery and the shipbuilding and maritime industries will bounce back quickly.
Vietship 2012 has attracted many international groups from advanced shipbuilders such as Japan, the Republic of Korea, China, Poland, the Netherlands, France, Switzerland, Norway, Singapore, Russia and Spain.
The expo features showrooms of the world’s latest maritime technologies and equipment. Several seminars and forums on the future of the shipbuilding industry will be held during the event, which is open until March 1.
Amidst future nuclear power plant, such as small-sized nuclear power plant, rising for an alternative for existing nuclear plants, nuclear power is recently discussed as ship propulsion power.
On February 10th, 100-some of those specialized in nuclear power and ship had a discussion on making use of nuclear power in the sea, not on land, at Korea Advanced Institute of Science and Technology (KAIST).
Professor Jung Hyun, Division of Ocean System Engineering of KAIST made a presentation on his research on nuclear-powered FPSO and Professor Lee Pil-Seung of the same division suggested that it would be possible to install stanchions 2-3km off the shore and construct nuclear power plant on them.
According to Lee, Russia has already developed offshore nuclear power plant placed on a ship and is soon to start operation.
Professor Hwang Il-Soon, Department of Nuclear Engineering of Seoul National University said that nuclear-powered ship can solve safety issues by separating power system and engine system. Hwang introduced a model which is powered by nuclear power off the sea and powered by diesel engine when coming into the port.
There was also an idea that 'Floating port' carries cargoes or passengers into the ship.
If SMR(Small Modular Reactors) are developed with application of fast reactor, etc., the nuclear-powered ship can operate over 30 years of a total lifespan of the vessel.