COSCO chairman Ma Zehua appealed for cooperation between different sectors of the shipping industry and called for an end to cut-throat competition to survive the longest and most severe crisis shipping has ever known, Xinhua reports.
Mr Ma made the statement at a shipping conference and said no company was immune to growing market perils of our times.
Song Jiahui, an officer in charge of safety from the Ministry of Transport said the biggest problem the shipping industry is facing now is overcapacity, which has brought the whole industry to a situation of life or death.
Mr Ma said the world's container fleet capacity is 1.69 billion TEU, which is 268 per cent that of 10 years ago. Bulk fleet capacity is 707 million tonnes, 237 per cent of 10 years ago. Oil tanker capacity is 503 million tonnes, 167 per cent of a decade ago.
The current low shipbuilding price is also luring impulse to build new vessels. In September, new ship orders surged 165 per cent year on year.
Mr Song pointed out that the world's container fleet is facing an excess rate of 25.9 per cent and oil tankers 14.7 per cent. Dry bulk fleet's is 26.6 per cent.
This already the fifth year of the downturn, the world's economy has fallen to the bottom and is in a period of restructure, which will hinder the recovery of the market, said Mr Ma.
To help the struggling shipping industry, the Ministry of Transport introduced a number of measures covering capacity control, restructuring, strengthening administration, easing burdens and improving service quality.
Meanwhile, China has created plans to accelerate development of river transportation. By 2020, an efficient, safe and green river transport network will be built up to provide business opportunities for the shipping industry.
Besides, the newly set up Shanghai Free Trade Zone will also bring opportunities for the industry. Mr Song said the Ministry of Transport is seeking an innovated and internationally competitive system for the operation and development of the shipping industry with the Shanghai government.
China will also improve its market administration mechanism to secure fair competition. The Ministry of Transport introduced a new policy requiring carriers to report their exact price to dampen prevent rate fluctuation.
Source : HKSG.