The Shipyards’ and Maritime Equipment Association (SEA) Europe and the European Community Shipowners’ Association (ECSA), the trade associations representing European shipbuilding and maritime equipment and European shipowners, respectively, said they welcome the recent statement of EU Trade Commissioner Cecilia Malmström against alleged unfair trade practices in the Far East.
SEA Europe and ECSA in a joint statement dated October 5 has called upon the European Commission and the EU member states to “take concrete and decisive actions against such practices and in favour of a true global level playing field for the European industry.”
Market-oriented conditions, rules-based trade, and open markets are essential to allow European shipping, shipbuilding, and marine equipment companies to operate internationally, the statement added.
It said Malmström stressed that the European Commission will do what is necessary to shield European shipowners, European shipyards, and European maritime equipment manufacturers from the alleged “negative impact from competitive distortions resulting from massive subsidies from China and South Korea.”
It added that the commissioner recalled that the “EU is engaging with Chinese counterparts bilaterally as well as with other key shipbuilding nations in plurilateral fora” to address market-distorting practices. Furthermore, the commissioner also underlined that the European Commission is paying close attention to South Korea’s recent support measures in favor of its local shipyards, which “could also be significant,” said the release.
Following the collapse of Korean carrier Hanjin Shipping, the South Korean government officially announced in April this year the implementation of a five-year plan to generate US$48 billion in revenue to resuscitate the country’s battered maritime industry.
The plan includes financing the building of more than 200 ships, including 140 bulkers and 60 containerships, and forming a local global terminal operator to emulate the likes of Singapore’s PSA International and Dubai’s DP World in order to acquire overseas terminal assets.
It is also said to feature a comprehensive restructuring plan for the nation’s shipbuilding industry that will include seeking a new owner for Daewoo Shipbuilding and Marine Engineering, and placing orders for 40 public-purpose ships, such as military vessels and patrol ships, to keep local shipbuilders afloat.
SEA Europe Secretary General Christophe Tytgat said: “The latest support measures from South Korea are clearly an example of unfair competitive distortions. By creating artificial demands through state aid, South Korea has regrettably contributed to today’s severe overcapacity in merchant shipbuilding and merchant shipping, with dramatic, far-reaching consequences for all market players, first for European shipbuilding and now also for European shipowners and the entire maritime value chain.”
He added that Europe now “needs to be vigilant that the same unfair trade practices with the same potential devastating effects are not repeated in other shipbuilding and shipping segments.”
ECSA Secretary General Martin Dorsman said, “The South Korean reform plan is greatly concerning for the European shipowners and shipbuilding industry. These measures create an uneven playing field, hamper the free and equal access to international maritime transport and contribute to the global overcapacity. Part of this plan is also the support to secure stable cargoes for Korean flagged vessels, which is a flag reservation measure of a particularly protectionist character. At a time that protectionist trends are rising, we ask Europe to send a strong message in support of free, fair and rules-based trade.”
Photo: Rama
