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Taiwan unveils $17.6bn relief package to help shipping firms

Taiwan unveils $17.6bn relief package to help shipping firms

Taiwan has unveiled a TWD560bn ($17.6bn) relief package to help the country’s ailing shipping sector struggling with financial difficulties, the local media reported.

The country’s ministry of transportation and communications announced on Tuesday that the TWD560bn in financial aid has been set aside for the local shipping industry, enabling financially-troubled firms to seek loans with preferential interest rates.

“The nation relies on shipping firms to transport goods that come in large quantities, which is key to the nation’s economic development,” Wang Kwo-tsai, deputy minister of transportation and communications, was quoted saying.

“We have submitted the plan to the Executive Yuan [central government] for final approval so that it can be quickly implemented to help shipping firms battle the worldwide slump in the industry,” he said.

According to the ministry, any domestic shipping firm suffering from a net loss for four consecutive quarters is eligible to apply for a low interest loan.

Over the past four quarters, Evergreen Marine and Yang Ming chalked up accumulated losses of TWD8.91bn and TWD16.83bn respectively, making them eligible to file for the financial assistance.

An analyst at Hua Nan Securities was reported saying that the Taiwanese government is fearing that the South Korean Hanjin Shipping bankruptcy case would happen in Taiwan.

The global tonnage supply glut suppressing freight rates has eroded earnings of many shipowners and operators, on the back of uncertain demand growth in the global economy.

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