COSCO scraps eight vessels
CHINA COSCO Holdings Company Limited has disassembled eight vessels from its aged fleet, the group said in a filing to the Hong Kong stock exchange.
The scrapped vessels include eight container ships (Hutuo He, Xinhui He, Zhaoqing He, Yangjiang He and Yongding He) and three bulk carriers (Peng Jie, Peng Nian and Peng Cai) that were disposed of during January.
The vessels, with the aggregate capacity of 257,657 deadweight tons, were disposed of as scrapped vessels to different purchasers, all of which are independent third parties of the company.
The Board considers that the decommissioning of the vessels is conducive to enhancing the overall operational competitiveness of the shipping fleet of the company and is in the interest of the company and the shareholders as a whole.
Meanwhile, an anti-corruption inspection team raised by the central government of China has alleged corruption in the state run shipbuilding conglomerate, China State Shipbuilding Corporation (CSSC).
According to the central government, corruption search light which commenced in November, 2013, is on 13 state-run groups including China State Shipbuilding Corporation, the China Shipping Group and oil giant Sinopec.
Leader of the team, Liu Zu, explained that they have found the company’s supervision mechanism weak, which according to him has led to corruption activities in the procurement department involving senior officials in the company.
Already, the team has reported the information from the inspection to the Central Commission for ‘discipline inspection’ adding that investigations continue.
Meanwhile, the take-over of Wartsila’s two-stroke engine business by China State Shipbuilding Corps (CSSC) has been wrapped up, after receiving the necessary government and merger control approvals.
The company is owned 70 per cent by CSSC and 30 per cent by Wartsila, and has been renamed Winterthur Gas & Diesel (WinGD).
The joint venture will continue to develop and promote sales of the two-stroke engine portfolio and the servicing the engines will remain the responsibility of Wartsila via its global service network.
The partnership between two of the marine sector’s major players will enhance the market opportunities for the company’s two-stroke engines, the companies said.
“The global shipping industry is developing with fuel economy and environmental compliance as its driving forces. The combination of Wartsila’s technical leadership and CSSC’s industrial strength will support the aim of WinGD to serve the industry,” said WinGD CEO Martin Wernli.
In a related development, Philippine officials has accused China of expanding reclamation work in disputed waters of the South China Sea, as the United States again called for restraint in the territorial conflict.
The Philippine and United States officials spoke as the long-standing allies ended a two-day strategic dialogue in Manila, reaffirming the two states’ defence and economic cooperation.
“The Chinese activities in the West Philippine Sea (South China Sea) continue to be a serious concern, arising from reports of greater development in reclamation,” Philippine defence undersecretary Pio Lorenzo Batino told reporters.
Philippine foreign undersecretary Evan Garcia described the Chinese reclamation work as “massive” and a violation of an agreement among South China Sea claimants not to build new structures until a binding code of conduct was in place.
“It is not helpful in finding a way forward. It is not an example of what everyone would understand as self-restraint,” Garcia said.
The Philippines last year accused China of blasting sand and rocks to reclaim areas around reefs in the sea. Facilities under construction reportedly include an airstrip.
The US has “laid out a persuasive case for restraint” in the South China Sea, said assistant secretary of state Daniel Russel, calling the territorial disputes an “ongoing concern”.
“We believe bigger nations can’t bully the small,” he said.
“We have a huge interest in stable, healthy, constructive bilateral relations with China,” Russel said, while adding that the US was also concerned about “behaviour that raises tensions, behaviour that raises questions about China’s intentions”.
US assistant defence secretary David Shear said Washington strongly supported Philippine efforts to modernise its military, which is one of the weakest in the region.
He said the US had provided the country with $300 million in military-related assistance since 2001 and would provide another $40 million this year.