09 December 2013

China reveals new ship scrapping policy:

China has revealed a new ship scrapping policy to accelerate the demolition of older vessels and streamline the overall efficiency of the shipping sector.

The ministry of transport announced last Friday a policy that will offer subsidies of RMB1,500 ($247) per gross tonne to shipping companies that scrap their vessels before their operational expiry dates.

The ministry said the subsidies would be given in two tranches – one upon the completion of the vessel demolition and another after the construction of the new replacement vessel.

The policy further states that the total tonnage of the newly ordered ships should not be less than the total tonnage of the vessels scrapped. Shipowners can choose to tabulate their tonnage figures based on a cumulative basis from all the scrapped vessels and newbuildings or on a 'one for one' basis.

The new vessels should also be Chinese flagged. The newly built vessels are also expected to be equipped with green technologies, in particular the ability to reduce fuel consumption and emissions.

The ministry explained that the policy is aimed at reducing pollution hazards from older, single-hull vessels, improving the operational safety of vessels, and raising efficiency and specifications of the country's shipping fleet.

Source:  seatrade global.  9 December 2013

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