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September 22, 2010

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Shipyards warned of overcapacity

CHINA'S marine equipment sector may see overcapacity and shipyards hoping to enter the market should be cautious, industry insiders warned.

More than 30 domestic shipyards have unveiled or are making preparations to launch marine engineering projects, which may cause overcapacity in the sector, Zhang Guangqin, chairman of China National Association of Shipbuilding Industry, said at the International Forum on Development of Ocean Engineering in Shanghai yesterday.

"Many of the current shipyards can be transformed into marine engineering manufacturing bases but massive investment is not proper under such circumstances," he said. "Radical investment and government encouragement is not appropriate."

The hunt for offshore energy will spur investment in the detection and exploitation of gas and oil globally to US$50 billion in the next five to 10 years, according to the insiders. But they also warned that only 75 percent of all the offshore platforms around the globe are still operational.




 

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