China Tightens Shipbuilders' Credits: Singapore May Benefit
Singapore's Keppel Corp Ltd and Sembcorp Marine Ltd, the world's top offshore rig-makers, stand to be among the winners through Beijing's moves to tighten credit amid a downturn at China's shipyards, reports Reuters.
The two companies have been under mounting pressure from Chinese yards offering generous payment terms, price discounts and help with financing, but that may be changing after Beijing pledged to cut credit to industries plagued with overcapacity, and China Rongsheng Heavy Industries Group, the country's largest private shipbuilder, fell into financial trouble.
Rongsheng could now become the biggest casualty of a local shipbuilding industry suffering from overcapacity and shrinking orders amid a global shipping downturn. New ship orders for Chinese builders fell by about half last year.