China wants to grow fleet with foreign investors

China wants to grow fleet with foreign investors China will encourage foreign banks, logistics companies, cargo owners and others to invest in its shipping industry to help expand its fleet, according to an article in China Daily.
   The newspaper quotes Cao Desheng, deputy director of the Ministry of Communications’ Water Transport Department, as saying the country aims for its ocean-going fleet to reach 100 million deadweight tons by 2010, up from 33 million. China wants to have its fleet climb from the No. 6 to No. 3 flag by 2010.
   But the paper said the ministry wants Chinese domestic companies to hold 25 percent of companies “to overcome worries over shipping security,” and for ships to register ships in China and employ Chinese mariners.
   Cao said China National Petroleum Corp. (Sinopec) and China Petroleum & Chemical Corp. (Petrochem) will join hands with China Changjiang National Shipping (Group) Corp. and China Shipping (Group) Co. to form a new shipping company, Cao said.
   According to the report in China Daily, high tariffs and value-added tax on imports has caused many Chinese ship owners to register their vessels in other countries. The paper said the number of Chinese vessels registered abroad has been increasing, and they now account for about half of the country’s international tonnage.
   The paper said the ministry has decided to grant tax exemption to Chinese-owned ships that were registered abroad before 2006 and that this is expected to make them register ships in Shanghai, Tianjin or Dalian — in the next two years, till July 1, 2009.
   The paper said the ministry is also discussing some long-term policies to encourage Chinese-owned ships to register at home.