Shipping Group Calls for China to Increase Ship Scrapping

The Baltic and International Maritime Council has urged China to increase its ship-scrapping capacity to help handle the rising number of vessels worldwide due for demolition.

According to Philippe Poirier d'Ang d'Orsay, retiring Bimco president, 90 million metric tons of ships would have to be scrapped by 2007, but existing capacity was able to handle only about 15,000 metric tons a year.

He pointed to the difficulties that lay ahead with the phasing out of single-hulled tankers to comply with the latest amendments to the International Maritime Organization's International Convention for the Prevention of Pollution from Ships.

Bimco research indicated about 3,000 ships would leave service by 2016.

India is reducing its scrapping capacity because of the need to scrap in an environmentally friendly fashion. This makes it difficult to employ many existing beach facilities.

Bimco also was trying to improve tanker industry standards by including a code of practice to ensure no noxious gas that could damage the environment escaped during the scrapping of tankers.

However, it would be left to the market to adjust to supply and demand, he said.

If the retirement of single-hulled tankers was accelerated, it would put pressure on the industry and cause an imbalance.

d'Orsay said the fact that 42 percent of the world's shipping was owned in Asia showed how the balance was tipping towards the east.

About 300 million deadweight metric tons was an important slice of total world tonnage.

The rate of growth in the east was most significant in China, where the modernization of the marine industry was regarded as an essential infrastructural development that throughout the 1990s had enabled the mainland to average an annual 10 percent growth.

There might be imbalances in the rate of growth of Asian economies, but they were perceived as full of strength and generally recovering well from the 1997 financial problems.

China's accession to the World Trade Organization, and the integration of this market into the global economy, would see it doubling trade in the short term.

d'Orsay said Bimco placed great importance on Asia and that was why, in two years, Bimco president Michael Everard would hand over to the chairman of Orient Overseas (International), Tung Chee-chen, further acknowledgment of the global representation of Bimco. South China Morning Post