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Shipbuilder Sets up Trading Subsidiary

The China Shipbuilding Industry Corp (CSIC), one of China's two largest shipbuilders, yesterday set up a subsidiary specializing in trading.

Xu Ziqiu is president of the new company, the China Shipbuilding & Offshore International Co Ltd (CSOC). He said he believed the subsidiary can help China reach its target of becoming the world's shipbuilding centre.

"The CSOC will construct a worldwide marketing network by setting up representative offices in major shipping markets, establishing partnerships with world-famous ship owners, shipping companies, classification societies and shipbuilding brokers," Xu said.

The subsidiary company has a registered capital of 367 million yuan (US$44.3 million) and total assets of 1.5 billion yuan (US$181 million).

Through the professional trading company, the parent company CSIC can enhance its marketing ability in the world market and thus increase the country's presence in the market, Xu said.

China is expected to become the world's largest shipbuilder in 15 years.

It is already the world's third-largest ship exporter after Japan and South Korea, up from 17th in the early 1980s.

China manufactured 4.46 million tons of ships and related products last year, making it the world's third-largest producer for the eighth consecutive year.

Japan and South Korea now account for 70 percent of the world market, while China holds about 10 percent.

China's progress towards becoming a shipbuilding giant can also create opportunities for the new company's fast development, said Xu.

He said the company's total assets could jump to between 8 billion and 10 billion yuan (US$967 million and US$1.21 billion) in a decade.

"In addition to the opportunities provided by the growth of the national shipbuilding industry, the worldwide industrial shift from Europe to Asia, the revival of the world shipping market and the bigger building capacity of the CSIC come at a good time for the company," Xu said.

The parent company CSIC aims to enlarge its shipbuilding capacity to 3 million tons by 2005, 5 million by 2010 and 8 million by 2020.

To promote the country as the world's shipbuilding centre, the China State Shipbuilding Corp, the country's other largest shipbuilder, announced on August 12 that it would construct the world's largest shipyard in Shanghai.

The US$3 billion scheme aims to increase the corporation's shipbuilding capacity to 12 million tons by 2015 from the current 3 million tons.

(China Daily August 29, 2003)

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