Information has leaked that Beijing will soon reveal a new policy detailing how the ‘white list’ shipyards will be able to enjoy financial support from the local banks. So far, China’s ministry of industry and information technology has only made a general statement saying that the ‘white list’ yards would be able to gain easier access to loans.
The shipyard ‘white list’, recognised as an important national policy tool aimed at reviving the ailing shipbuilding industry, is expected to see the provincial governments throw their weight behind the listed enterprises under their charge, and help them secure credit facilities from their local bank branches.
In Zhejiang province, for instance, the Zhoushan city government is planning a so-called ‘matchmaking’ platform for shipbuilders and bankers, where the city’s six listed shipbuilders and those that wish to get listed are invited to network with the banks and share with them information on the current state of the market.
Zhejiang province has seven shipyards in the ‘white list’ and two more, Tsuneishi Group (Zhoushan) Shipbuilding and Zhoushan Wuzhou Ship Repairing & Building Co, are understood to have applied for the ‘white list’ status.
Perhaps the biggest advantage of being a ‘white list’ yard is the ability to gain greater access to loan facilities, in view of the high capital cost of the shipbuilding business and the cashflow problems faced by many yards. And Beijing is expected to shed more light on this aspect of the policy.
Observers of the China market believe that the ‘white list’ policy would promote the transformation and upgrading of the shipyards, as well as structural adjustments that would bring about a concentration of resources, rather than the current situation of excessive yard capacity. Such fundamental improvements to the sector would then allow China’s shipbuilding industry to pose greater competition on the international stage.
The first batch of 50 ‘white list’ shipyards, a mix of state-owned and private enterprises, was unveiled by China in early September, while a second batch of 21 companies are under review before a confirmation by the end of November.