China’s shipping group COSCO has secured a loan from China’s Export-Import bank to fund 53 newbuildings.
The $1.75b loan will be used to order vessels from Chinese yards. The newbuilds are expected to include a 90,000dwt semi-sub, China’s largest locally built semi-sub to date, 300,000dwt tankers, 9,400teu container ships and fuel efficient bulk carriers.
The new vessels will replace vessels that have been scrapped over the last few years and are expected to have 20 percent better fuel efficiency than those they will replace.
The Exim Bank deal was signed in Shanghai on Friday, and brings the bank’s total shipping loans to $93.4bn since its establishment in 1994.
The deal supports a program to boost the local shipbuilding industry.
Cosco Container Lines recently won government approval to use foreign-flagged vessels to carry containers between Shanghai and other Chinese ports. The relaxation of cabotage rules is being trialed in order to promote Shanghai as a transshipment center and is expected to put pressure other ports such as Hong Kong and Busan in South Korea.
Shenzhen and Guangzhou, Hong Kong’s main competitors in the region, might follow suit.