South Korea Faces WTO Action For Shipbuilding Practices

Friday, November 12, 1999
The European Union is considering taking action against South Korea under the World Trade Organization, accusing the country of using western subsidies to sell ships at below construction cost and putting European rivals out of business. "The sector is facing a critical situation worldwide with very low prices and a serious overcapacity caused by the Republic of Korea," EU industry ministers said after a regular meeting where they discussed a European Commission report on the world shipbuilding situation. The ministers asked industry, national governments and the Commission to seek "as much detailed evidence as possible...in order to take appropriate action under the WTO". EU Enterprise Policy Commissioner Erkki Liikanen specifically charged South Korea with a deliberate policy of building up a very strong shipbuilding industry through increased capacity and below-cost prices. South Korea, he said, increased its share of the world market to 35 percent, well ahead of Japan and the 15-nation EU. The three make up for about 80 percent of the world shipbuilding market. The most dramatic change was in container vessels, with Korean yards now grabbing 70 percent of contracts worldwide from a previous 15 percent market share, he said. The Commission has been complaining for over a year that South Korea may have been channeling part of a $58 billion bailout from the International Monetary Fund in 1997 into its shipyards. The Korean government has rejected the allegations. "The IMF and the World Bank ought to carry out an analysis of whether the credits are being used to subsidize Korean shipyards," Siegmar Mosdorf, German state secretary in charge of industry, said. Germany and Spain have been the most vocal critics of the Korean increased competitiveness after the industry underwent a severe restructuring which translated into heavy job losses. The sector still employs over 100,000 people in Germany, including related industries. Despite the harm to European industry, Finnish Industry Minister Erkki Tuomioja was against opening a subsidy war by allowing national EU governments to support their own business. The EU agreed earlier this decade to end subsidies to the industry. "The most important message of this meeting is to the Koreans. We would not be helping this if we said we're reconsidering subsidies," said Tuomioja, whose country holds the EU rotating presidency.
Maritime Reporter June 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Shipbuilding

Technip Samsung JV Wins 2 FLNG Project Contracts

The Browse project covers the realization and installation of three FLNG units to develop the Brecknock, Calliance and Torosa fields in the Browse Basin, 425 kilometers North of Broome,

Carlyle Group Acquires LMC

Global alternative asset manager The Carlyle Group today announced the acquisition of Lauderdale Marine Center (LMC), the nation's largest yacht repair facility

Saab Bags $1 bln Order for Swedish Submarines

The Swedish Defence Materiel Administration (FMV) has awarded contracts worth Skr8.6bn ($1.03bn) to Saab AB for the construction of two new Type A26 submarines

Navy

Saab Bags $1 bln Order for Swedish Submarines

The Swedish Defence Materiel Administration (FMV) has awarded contracts worth Skr8.6bn ($1.03bn) to Saab AB for the construction of two new Type A26 submarines

Austal Delivers 7th Cape Class Patrol Boat

Shipbuilder Austal Limited announced it has delivered Cape Wessel, the seventh of eight Cape Class patrol boats being supplied to Australian Border Force under a $330 million design,

EU NAVFOR Consults Somali Fisherman

Sailors from Operation Atalanta Warship ITS Libeccio speak to local fishermen about European Union’s efforts to deter Somali piracy   Sailors from Operation Atalanta

 
 
Maritime Security Maritime Standards Naval Architecture Navigation Pipelines Pod Propulsion Salvage Ship Electronics Ship Simulators Shipbuilding / Vessel Construction
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1377 sec (7 req/sec)