In International Shipping News 19/10/2016
South Korea’s top financial regulator affirmed Tuesday that the government will soon unveil a set of measures to help reinvigorate the nation’s shipping industry currently faced with low freight rates and a protracted slump.
A sense of crisis is palpable here over the future of the sector, once hailed as a key business of Asia’s fourth-largest economy, as the country’s No. 1 shipper Hanjin Shipping Co. has been placed under court receivership due to mounting debts.
“With regard to the Hanjin issue, the part in which the government should have more interest is not to let the competitiveness of the shipping industry be undermined,” Yim Jong-yong, chairman of the Financial Services Commission (FSC) told reporters.
Related authorities are “comprehensively reviewing” ways to enhance its global competitiveness, he added.
“(The government) will wrap up the discussions within this month,” Yim said during a parliamentary audit session.
On the restructuring of the shipbuilding field, he pointed out it’s still premature to conclude any local shipyard should be liquidated.
Reportedly, McKinsey & Co., a global consulting firm, plans to submit a report to Korea Offshore & Shipbuilding Association that Daewoo Shipbuilding & Marine Engineering Co. won’t be able to survive.
Yim said the contents of McKinsey’s report has not been finalized yet.
If available, he added, it will be used as reference material for the government’s efforts to reform the shipbuilding sector.
Yim Jong-yong, chairman of the Financial Services Commission, answers a question during a parliamentary audit session at the National Assembly on Oct. 18, 2016, with Zhin Woong-seob, head of the Financial Supervisory Service, sitting next to him. (Yonhap) Yim Jong-yong, chairman of the Financial Services Commission, answers a question during a parliamentary audit session at the National Assembly on Oct. 18, 2016, with Zhin Woong-seob, head of the Financial Supervisory Service, sitting next to him. (Yonhap)
Meanwhile, the FSC chief reaffirmed the government’s resolve to privatize Woori Bank, a major lender based in Seoul.
The South Korean government owns a controlling 51 percent stake in the bank through the state-run Korea Deposit Insurance Corp. (KDIC), a legacy of the 1998 Asian financial crisis.
It it seeking to sell off around a 30 percent stake in Woori to multiple investors by the end of this year.
A bidding process will formally begin next month.
“Once the stake in Woori Bank is sold, the government will firmly guarantee autonomous management,” Yim emphasized.
The KDIC will retain the remaining 20 percent of stake to maximize taxpayers’ money to be retrieved, waiting for share prices to jump later on, he said.
Source: Yonhap
