The European Commission said in a market assessment
report that the world shipbuilding industry is in crisis.
"As capacities continue to grow, competition from low-wage
countries is getting stronger and prices are nose-diving," the EC said.
The Brussels agency said that, for certain types of ships, profits from
shipbuilding operations "seem almost impossible to achieve."
This situation has been made more acute by the Asian crisis and
shipbuilding capacity cuts are needed, it added.
Under the European Union’s council regulation No. 1540/98, the EC is
required to present to the council of ministers a report on the market situation and
appraise whether European yards are affected by anti-competitive practises.
The EC expressed concerns about South Korean shipyards and the
country’s emergency measures in favor of ailing shipyards.
The report identifies areas of possible EU action to address
competition issues. These include ensuring that the conditions of the International
Monetary Fund-led rescue package are fully respected by Korea; examining the possibilities
offered by the Agreement on Subsidies and Countervailing Measures of the World Trade
Organization; continuing to monitor the market; and seeking an agreement to establish a
level-playing field in shipbuilding.
The 1994 agreement of the Organization for Economic Cooperation and
Development to cut shipbuilding subsidies has not been implemented, the EC said.
In a related development, the EC said that the program of
"restructuring aids" – subsidies – for German and Spanish shipyards has been
completed.
EC SAYS WORLD SHIPBUILDING IS IN CRISIS
EC SAYS WORLD SHIPBUILDING IS IN CRISIS
