The Taiwanese government announced a $1.9 billion aid package for the country’s shipping industry, which both Yang Ming and Evergreen Line would be eligible for.
The Government of Taiwan has announced a $1.9 billion (60 billion New Taiwan Dollar, or NTD) aid package for the country’s shipping industry.
According to Taiwan’s Central News Agency (CNA), the Ministry of Transportation and Communications (MOTC) announced on Tuesday the program will allow Taiwanese shipping companies that have had losses for at least four quarters to apply for a low interest loan.
CNA said that under that criteria, both Evergreen Line and Yang Ming, Taiwan’s two leading container carriers, would be eligible for the loans. In terms of current container carrying capacity, Evergreen is the world’s fifth largest container carrier, while Yang Ming is the eighth largest, according to the Alphaliner ranking.
The relief loan interest rate will be capped at the post offices’ floating one-year deposit rate, plus 1.65 percentage points, which according to the Wall Street Journal, would amount to about 2.9 percent.
The ministry said the financial aid package will be submitted to Taiwan’s cabinet for approval and come into effect shortly, CNA added.
The Financial Times reported that Ye Kung-dong, professor of shipping management at National Taiwan Ocean University, said the program would stabilize the industry and marks the first time Taiwan’s government has issued a package specifically for the shipping industry.
In the first nine months of 2016, Evergreen Marine experienced a loss of 7.46 billion NTD compared with a loss of 760 million NTD in the first nine months of 2015, according to information posted on the Taiwan Stock Exchange website. Evergreen Marine’s revenues in the first nine months of this year totaled 90.2 billion NTD compared with 103.1 billion NTD in the first nine months of 2015.
Meanwhile, Yang Ming had a loss of about 12.98 billion NTD in the first nine months of 2016 compared with a loss of about 3.98 billion NTD in in the first nine months of 2015. Yang Ming’s revenues reached 83.9 billion NTD in the first nine months of this year compared with 97.7 billion NTD in the corresponding period last year.
The financial assistance follows the insolvency of Hanjin Shipping and massive amounts of aid provided by the government of Korea to support its shipping and shipbuilding industry.
Taiwan grants $1.9b aid to its shipping companies
