Korea unveils distressed ship fund

The South Korean government said it would provide Won4.7trn in loans to help build domestically-owned ships that are under construction or on order at local shipyards. The loans will be made available through state-owned Korea Export Import Bank and will be split between the shipyards and owners, with Won3.7trn going to the yards and Won1trn to shipowners, after a stringent credit assessment of potential recipients.

Domestic shipowners currently have approximately 186 ships on order in South Korean shipyards. A Korea Shipowners Association (KSA) spokesperson said: “These proposals have come rather late and they remain topics for further discussion between the government, the banks and the Korean Shipowners’ Association.”

“But, for all that, they are of course most welcome. We hope that it will eventually offer the necessary assistance many of our members need, if it materialises,” he added.