Amid overall depression in shipbuilding industry, China’s largest shipbuilding complex, Jiangsu Province, is suggested that it is hard for the city to avoid a difficult situation.
According to chinanews.com, an official at Nantong COSCO KHI Ship Engineering (NACKS) said that signing a newbuilding contract at the moment is the same as taking poison that as inking more and more deals, the situation will be deteriorated.
On the other hand, as Jiangsu Economic and Information Technology Commission released statistical data related to Jiangsu shipbuilding industry on July 17m, the body intended a warning that small and medium sized shipbuilders will go bankruptcy since construction slots are filled only for the next two years unless Jiangsu yards are awarded further in the near future.
Jiangsu Province is the No.1 shipbuilding complex in China, having three shipbuilding indexes (delivery, new order, orderbook) account for more than 30% in the nation and 10% in the world, however, the province was also blown by global financial crisis.
In the first half of this year, delivery and orderbook of Jiangsu declined by 32.9%, 17.5%, respectively, from the same period a year ago. On the contrary, newbuilding order was the only index growing by 189.7%, according to data from Jiangsu Economic and Information Technology Commission.
However, the increase in newbuilding order does not mean that every builder is in good condition. Taking 66 examples of builder and related companies, only 23 companies succeeded in winning newbuilding order and among 13 major companies, two turned out to have recorded ‘0’ contract for newbuilding.
An official at Nantong Cosco Khi Ship Engineering (NACKS) prospected that only around 100 companies out of 3,000 shipbuilders will survive in the coming years and pointed out that most of them are confronting bankruptcy crisis since many are having serious financial problems.