CSSC seeks foreign capital

China State Ship-building Corp (CSSC) is planning to spend $1.2 billion on the first phase to build the world?s largest shipyard on the island of Changxing in the Yangtze River off Shanghai. To fund this massive project, CSSC is seeking foreign capital but the sheer scale of the project is putting off most investors.

According to Guo Xiwen, CSSC’s director overseeing the project, the company needs to start off small and expand from there in order to attract foreign investors. The new yard will have an annual capacity of 4.5 million DWT by 2008 and it will be able to build all types of vessels from LNG carriers to oil tankers and cruise ships. CSSC believes its low labour costs, one-tenth of those in Japan or South Korea, will give it a huge advantage in the labour-intensive shipbuilding industry although, at the moment, it lacks the management expertise and shipbuilding technology of Japan and Korea.