South Korea’s Ministry of Trade, Industry and Energy announced yesterday that it would allocate KRW70bn ($61m) to support local shipbuilders.
According to the ministry, the fund will be focused on helping shipbuilders to develop environment-friendly vessels such as LNG-powered ships.
The latest financing support package is a follow-up to the government’s plan announced in November to invest around $2.5bn by 2025 to build up the LNG-powered ship sector and place order for a total of 140 LNG-powered vessels at domestic shipyards.
The ministry would also increase the fund for refund guarantees (RGs) for smaller shipbuilders.
In the meantime, the ministry has expanded a program supporting regions suffering as a result of the shipbuilding slump by two years. The designated regions include Mokpo in South Jeolla, Ulsan and a number of areas in South Gyeongsang, such as Geoje, Tongyeong and Changwon.
The program, set to run for only one year until May 2019, will now continue through May 2021.
South Korea has been making huge efforts to revive its ailing maritime industry in the past few years. Last year, Korea Ocean Business Corporation (KOBC), a state-run entity, was launched with the aim of supporting the local shipping and shipbuilding industry. The group has arranged financing packages for several domestic owners.