Korean yards need funding supportKorean yards need funding support

“Recently, as shipbuilding market is experiencing economic contraction, financial institutions' support for weakened while China is rather reinforcing its policy support for the industry that we are losing ground to China in an export competition against China,” KCCI said.

KCCI submitted a 'recommendation of policy support for shipbuilding industry to overcome crisis' to the ministry of strategy and finance, and the ministry of knowledge, economy and financial services commission.

The recommendation said: “Amid global economic recession, shipbuilders have struggled, this China has provided various financial support policies such as supporting high value vessel, project on offshore structure export and exclusive ship fund project.

“However, Korean shipbuilders' financial problems are getting worse because Korean financial institutions are passive about ship finance.”

KCCI suggested that institutions which support shipbuilding funds need to be expanded, and requested for liquidity assistance for mid-sized builders.

Is also proposed the establishment of ship guarantee fund in the shortest possible time. “The guarantee fund specialised in shipbuilding and shipping segments might be a good opportunity to raise international credit worthiness of our shipbuilding industry,” KCCI said.

“Policy support is urgently needed for builders to overcome the crisis through financial support which is tantamount to China's,” said Park Jong-gap executive director of KCCI.

South Korea had been the world's leading shipbuilding nation since 2001 in terms of export values. Last year, however, China exported $39.2bn worth of ships compared to Korea's $37.8bn.