A strategic agreement
between China Shipping Group and the Industrial and Commercial Bank of China
could help the company become more competitive in the container shipping
market.
China Shipping Group,
which is comprised of China Shipping Development, China Shipping Container
Lines and China Shipping Haisheng, will work with the ICBC on nearly all
financial moves, including risk management and strategic investments, to
advance the companies’ competitiveness. According to SeaTrade Global, the deal
is valued at $13 billion.
The Chinese government
announced a series of subsidies and new policies that would revive state-run
shipping companies in early September. Three weeks later, on Sept. 30, the
country doled out $293 million to several shipping companies. Though Cosco
Shipping and China Cosco took the lion’s share of those subsidies, $35 million
went to China Shipping Development Corp. and an additional $6.5 million was
given to CSCL.
The two companies will
spend a large portion of that money on ship scrapping, but it is also earmarked
for the building of new, more environmentally friendly vessels and various
other ship upgrades.
The group of companies
also is set to benefit from a partnership with e-commerce giant Alibaba, which
tapped the China Shipping Group to set up integrated cross-border logistics
platforms to help establish Internet shopping on the mainland.
CSCL, CMA CGM and the
United Arab Shipping Co. joined forces in early September to create the Ocean
Three Alliance, which would cut unit costs as the three carriers share costs.
CSCL is awaiting delivery of five 19,000-TEU-unit ships, which will be the
largest container vessels afloat. According to Alphaliner, CSCL is seventh on
the top 100 carriers list in terms of TEU capacity, deploying 3.4 percent of
the global fleet.
Source: JOC. 13 October
2014
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