Caution is urged over China yard ascendance.

(From Lloyds List)

Byline: Nation to become shipbuilding world leader within 10 years but 'investment risks will be high', writes Hugh O'Mahony

CHINESE shipbuilders remain on track to emerge as world leaders within a decade but investment risks will be high, according to a new report.

Research and Markets has just released 'China Shipbuilding Industry Report, 2005-2006', an analysis offering an insight into the rapid rise in China's shipbuilding sector but also counselling caution in the years ahead.

Noting that China's ship completions have consistently ranked third in world shipbuilding behind South Korea and Japan for a decade, the report says that the nation's shipbuilding capacity increased from 3.462m dwt in 2002 to 12m dwt during last year.

'According to us, from 2006 to 2010, the total demand of ships will reach 31m dwt, and the annual demand will be 6.2m dwt on average,' it continues.

Last year cumulative sales revenue of China's shipbuilding industry amounted to Yuan110.85bn ($13.7bn), up 42.6% on the previous year's figure, while profits amounted to Yuan4.29bn, far more than the Yuan1.64bn achieved in 2004.