More Money for Shipping!

Late in 2013, the Chinese government instituted a program whereas Chinese shipowners were provided certain compensation in order to demolish existing Chinese-flagged tonnage at Chinese demolition yards. The program was for relatively new tonnage of vessels newer than twenty years of age for a subsidy worth the equivalent of US$ 125 per gross ton. For (Chinese) shipowners wishing to replace such tonnage with new tonnage, always built at a Chinese shipbuilding yards and flying the Chinese flag, there was an additional compensation of the equivalent of US$ 125 per gross ton.

Please read here our full commentary on the program at the time by clicking here.

Just last week, the maritime and offshore news website gCaptain re-published a Reuters article that four Chinese ship-owning companies received 1.8 billion Yuan (approximately $293.3 million) in subsidies to renew their fleets; the companies were China Cosco, Cosco Shipping, China Shipping Development Co., and China Shipping Container Lines.

The Reuters article on gCaptain can be read by clicking here.


Not built in China: 9,500-teu Containership MV ‘Cosco Yantian’ docking in the Port of Hamburg earlier this year.  Image source:

As delighted as we are at seeing government people hard at work, one cannot miss the point of $300 million ‘free’ money just entering the shipping cycle. Quite a few of the attention-getting private equity funds active in shipping have kept their equity commitments to shipping well below such ceiling.

© 2013 – 2014 Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

IMPORTANT DISCLAIMER:  Access to this blog signifies the reader’s irrevocable acceptance of this disclaimer. No part of this blog can be reproduced by any means and under any circumstances, whatsoever, in whole or in part, without proper attribution or the consent of the copyright and trademark holders of this website.Whilst every effort has been made to ensure that information herewithin has been received from sources believed to be reliable and such information is believed to be accurate at the time of publishing, no warranties or assurances whatsoever are made in reference to accuracy or completeness of said information, and no liability whatsoever will be accepted for taking or failing to take any action upon any information contained in any part of this website.  Thank you for the consideration.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s