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Shipbuilders dispel recession fears

Sohel Parvez
Local shipyards still receive enquiries from foreign buyers about building small vessels despite a downturn in the global shipbuilding industry amid an economic recession and uncertain demand outlookthis year.
They however said buyers now offer low prices as steel prices dipped.
“We are still negotiating with buyers for a number of orders. But they offer low price,” Dr Abdullahel Bari, chairman of Ananda Shipyard and Slipways Ltd, told The Daily Star yesterday.
Bari, whose company won the first contract to build small vessel in 2005, also expects an immune from the current slump in the sector at a time when order cancellations and postponements have spread into the global shipbuilding sector, for which many shipyards in China, Korea and Singapore and Japan are in trouble.
The worst global recession since the Great Depression has caused funds to dry up, making it difficult for shipping lines to arrange loans for newvessels.
Bangladesh, a new entrant in global shipbuilding market, is yet to face any cancellation in orders or deferment in payments, thanks to the traditional shipbuilding nations’ shift in focus to make large vessels instead of smaller ones.
So far, local shipyards— mainly Ananada Shipyard and Western Marine Shipyard have received over $600 worth orders to make more than 40 vessels, with a capacity below 15,000 dead weight tonnes (DWT).
Most of the orders for these ships come from various European countries like Germany and Denmark.
The new export front has also drew attention of both past Caretaker and present Grand Alliance- with the latter's recent formation of a committee to recommend measures to boost the sector and emerge as one of the shipbuilding hubs from merely ship-breaking hubs.
Industry insiders said there are about 300 small and large dockyards, generating about 100,000 jobs, but only a few companies have been able to attract foreign buyers.
“The 2009 appears to be gloomy and low pro-
file year for shipbuilding worldwide but it will not affect Bangladesh," said Bari, pointing out that 2009 global orders for building vessels has become less than one-third of the total orders of about 10,000 ships in 2007.
Sakhawat Hossain, managing director of Western Marine Shipyard, also expected that they would not face any blow like cancellation of orders.
“We are concerned but not worried because our market is quite different... We build project vessels, not large ones, orders of which see cancellation. I hope we will be fine,” he said, adding that the company still receive enquiries.
"It's (inquiry) remained the same as it saw earlier," he said, but observed that prices would
drop because of the slump in steel prices amid global economic meltdown.
CF Zaman, country manager of the ship inspection company Germanischer Lloyd in Bangladesh, feared that the 2009 will be a difficult year for ship makers, both large and small vessels, due to fund constraints in developed economies.
“There are demand for ships but financing may be difficult,” he said, cautioning that the flow of new orders in Bangladesh might be affected in 2009.
“But it's a good time for us to prepare for the future so that we can receive orders after the recovery from the current meltdown,” he said. sohel@thedailystar.net