Debts at Korea’s top yards soar past KRW100trn

Debts at Korea’s top yards soar past KRW100trn

The combined debt held by South Korea’s top nine shipbuilders topped KRW100trn won ($84.7bn) last year according to the data compiled by local market researcher Chaebul.com. This marks a significant jump from the KRW90.5trn combined debt recorded in 2011.

Under pressure Daewoo Shipbuilding & Marine Engineering (DSME) saw its debt leap the most, up 53.1% over the four-year period to KRW18.6trn.

“As the government, business leaders and creditors missed the appropriate timing to roll out restructuring, the poor condition of the shipbuilding industry worsened, making the burden on the country heavier,” said Jung Sun-sup, who heads Chaebul.com.

A recent Nielsen survey shows South Koreans have the weakest consumer confidence in the world at the moment, in no small part down to the backfiring shipbuilding conglomerates and ensuing mass layoffs.

Societe General reported recently that the nation’s biggest yards – DSME, Samsung and Hyundai, are operating at just 60% of their capacity compared to their peak eight years ago.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

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