The worldwide shipbuilding industry is expected to flourish in the new century, with global shipping transportation predicted to grow about 40 percent in the next 15 years, according to experts.

China's water transportation capacity is expected to see rapid growth during the 10th Five-Year Plan (2001-05) period. More than 1.35 billion tons of cargo are expected to be transported by water this year, up about 8 percent from last year, according to official statistics.

The handling capacity of major ports in China will reach 1.87 billion tons this year, a 10 percent increase over 2000.

China's impending entry into the WTO offers a a big boost to foreign trade, which will in turn bring great opportunities for the development of the shipbuilding industry.

However, while China's shipbuilding industry takes credit for these opportunities, it cannot ignore the serious challenges and negative effects brought about by the WTO entry, experts warned.

After China enters the WTO, however, some foreign countries - where the shipbuilding industry is advanced but labour is expensive - may accuse China of dumping ships in their countries. In any case, the situation will be complicated, experts said.

Foreign capital can flow directly into China's shipbuilding industry after the country's entry into the WTO. And China's outstanding technical personnel will be hiring targets for foreign shipbuilding companies.

Most Chinese enterprises engaged in activities related to the shipbuilding sector do not currently possess their own intellectual property rights, relying instead on production certificates issued by foreign companies.

After China's entry into WTO, foreign enterprises can set up plants directly in China and customers can make global purchases. Foreign companies engaged in shipbuilding activities may not be willing to continue issuing production certificates to Chinese enterprises.

To solve the problem, the Chinese enterprises engaged in industries related to the shipbuilding sector must actively cooperate with their foreign counterparts, or prolong the effective period for production certificates, in order to survive future competition in the industry, experts said.

(China Daily 10/15/2001)