Executive Briefings

Asian Yards Criticized for Substandard Shipbreaking Practices, But China Said to Act Responsibly

The NGO Shipbreaking Platform has just published its fifth South Asia Quarterly Update re-igniting the on-going debate about the practice of breaking ships on beaches in Southern Asia. In it, China looks pretty good.

The update says that many shipowners continue selling their end-of-life vessels to substandard yards without considering the potential impacts for the workers or the environment, but reports favorably about Chinese shipowners.

"Comparatively, Chinese owners continued to sell more ships to Chinese yards than to South Asian yards this quarter. China is thus becoming the only leading shipping nation which so far ensures the clean and safe dismantling of a substantial part of its end-of-life fleet in modern ship recycling facilities."

According to Nikos Mikelis, non-executive director of cash buyer GMS, Chinese shipowners have been able to collect a very substantial subsidy from their government for the last year, and are expected to continue to do so at least until the end of 2015.

The level of the subsidy is “astounding” and exceeds the best-paying yards in India, Bangladesh or Pakistan. The yards also pay shipowners a sum. “So you can see that Chinese owners would be mad to take Chinese flag ships for recycling anywhere other than China,” says Mikelis.

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The update says that many shipowners continue selling their end-of-life vessels to substandard yards without considering the potential impacts for the workers or the environment, but reports favorably about Chinese shipowners.

"Comparatively, Chinese owners continued to sell more ships to Chinese yards than to South Asian yards this quarter. China is thus becoming the only leading shipping nation which so far ensures the clean and safe dismantling of a substantial part of its end-of-life fleet in modern ship recycling facilities."

According to Nikos Mikelis, non-executive director of cash buyer GMS, Chinese shipowners have been able to collect a very substantial subsidy from their government for the last year, and are expected to continue to do so at least until the end of 2015.

The level of the subsidy is “astounding” and exceeds the best-paying yards in India, Bangladesh or Pakistan. The yards also pay shipowners a sum. “So you can see that Chinese owners would be mad to take Chinese flag ships for recycling anywhere other than China,” says Mikelis.

Read Full Article