Beijing adopts selective lending to force shipyard consolidation
Mainland still the world's biggest shipbuilder in terms of volume, although overcapacity has seen number of yards almost halved from 2012
About half of the mainland's shipyards have gone out of business in the past two years, and only 10 per cent of the bigger ones remaining have received new orders as overcapacity is shaken out of the market, thanks to selective, state-backed financing.
The number of shipyards had fallen to about 1,600 from more than 3,000 in 2012, Guo Dacheng, the president of the China Association of the National Shipbuilding Industry, said at an industry event last week.
About half of those left - 815 yards - had capacity of 300,000 dwt, a threshold of meaningful scale as modern cargo ships grow larger.
Of those 815, only 82 received new orders last year, and only 60 received financing from the Export-Import Bank of China, a policy bank with a state mandate to fund exports of mainland-built vessels.
Shipbuilding is one of the most oversupplied industries in the mainland economy and is a frequent target of Beijing's efforts to mothball excess capacity. The other sectors include steel, cement and electrolytic aluminium.
The latest call came in September when the Ministry of Industry and Information Technology released a "white list" of 51 shipyards eligible for further preferential policy treatment such as financing from the Exim Bank.