THE CEO of Singapore's Pacific International Lines, Teo Siong Seng, warned of serious trouble ahead if too many joined the shipbuilding craze because money was easy to get and "ships are as cheap as they can be".
Speaking at the Sea Asia conference in Singapore, Mr Teo, also chairman of Singapore Maritime Institute, feared that private equity funds would artificially push up ship value, which could lead to collapse in the market.
"Equity funds build vessels so they can sell at higher prices a few years later," he said. "You see something like a bubble in real estates and commodities. That gets me worried."
Mr Teo also sought to offer some possible solutions, reported Lloyd's List. Especially in the container sector, where he called for consolidation and re-focusing on services rather than fleet size.
"It is a matter of bringing people together to realise the challenges and the opportunities, and look at how we can overcome them together," Mr Teo said.
Tan Beng Tee, assistant chief executive in development at Maritime and Port Authority of Singapore, pointed out that Singapore lacked the history of attracting shipping stocks like the US.
"Moreover, deep sea shipping stocks are still languishing. Offshore shipping stocks in Singapore are doing relatively well, though," said Ms Tan.
SHIPBUILDING
10 April 2014 - 04:47
PIL chief warns of easy lenders and the rush to build cheap ships
THE CEO of Singapore's Pacific International Lines, Teo Siong Seng, warned of serious trouble ahead if too many joined the shipbuilding craze because money was easy to get and "ships are as cheap as they can be".
SHIPBUILDING
10 April 2014 - 04:47
PIL chief warns of easy lenders and the rush to build cheap ships
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