China approves shipping giants' restructuringStaff writer ▼ | December 14, 2015
China's cabinet has approved the restructuring of the country's two biggest shipping conglomerates, creating the largest oil tanker fleet in the world and the fourth biggest container line.
Shipping industry COSCO and China Shipping will be restructured
The move will improve the competitive edge of major Chinese shipping lines by realizing economies of scale, as the global shipping industry faces a long-term downturn, according to a joint reply to Xinhua's questions from the chairmen of the two companies.
Both COSCO and China Shipping have struggled to be competitive, with overlapping investment, high costs, similar operations and industrial chains, said the reply from COSCO chief Ma Zehua and China Shipping's Xu Lirong.
COSCO has an annual freight volume of over 400 million tonnes, with more than 700 ships whose total deadweight reaches 51 million tonnes. China Shipping has more than 530 ships with 36 million tonnes of deadweight.
Four listed firms under the two groups will have their assets reshuffled to focus on different areas, and the realignment is expected to start next year, according to statements they made after the announcement. ■