THE Hong Kong shipping community has welcomed the initiatives of China Ocean Shipping Co (COSCO) and Sinotrans in tackling the problem of overdue freight payments in China.
That is because some of the money owed to COSCO and Sinotrans is, in turn, owed to foreign shipping companies, including those based in Hong Kong.
Hong Kong companies have, for many years, experienced difficulties in collecting payment for freight in China.
Some shipping lines report situations where payments are outstanding for more than a year. Some small freight forwarders have been bankrupted.
Shipping lines also experience difficulties when payments eventually arrive for multiple shipments.
Quite often, these payments do not add up to the outstanding total and carriers are left with the task of figuring out which shipments are outstanding and which have been paid for.
Shipping companies have reviewed this issue several times, but have been able to do little because they have had to deal with state-owned enterprises and shipping agents.