China Ocean Shipping (Cosco) - the mainland's biggest shipping company - yesterday confirmed that the planned merger with China National Foreign Trade Transportation Corp (Sinotrans) had collapsed.
Cosco chairman Chen Zhongbiao yesterday said the prevailing hard times in the shipping industry were not conducive to a state-level merger.
The merged company would have formed one of the largest shipping firms in the world.
'Various government agencies have reached a consensus that a merger at a time of the sector's downturn would undermine the development of the two companies, so the merger plan has temporarily been shelved,' he said.
Mr Chen said Cosco - controlled by the Ministry of Communications under the State Council - preferred to operate on its own instead of merging with other companies.
He also confirmed that commercial shipping operations of the People's Liberation Army would gradually be taken over by various State Council bodies and agencies after Beijing ordered the military to sever all commercial links last week.