Korean shipbuilders were outperformed by their Chinese competitors in exports last year, 11 years after Korea in turn overtook Japan in 2001.
The Korean Chamber of Commerce and Industry on Wednesday said analysis of data from the Korea International Trade Association puts exports by Korean shipbuilders at US$37.8 billion in 2012, compared to China's $39.2 billion.
The change is due to the fact that Korea was more affected by the global downturn than China. Korean shipbuilders saw exports decrease around 30 percent on-year in 2012 while their Chinese and Japanese rivals posted drops of only 10.3 percent and 14.6 percent.
The shipbuilding industry has been one of Korea's mainstays. Since the mid-2000s, it enjoyed a boom and grew to post $54.1 billion in exports in 2011. But China has lately been putting up strong fight. Korea managed to edge slightly ahead of China in terms of global orders last year, when it accounted for 35 percent compared to China's 33.3 percent.
Industry insiders cite Chinese government support as the reason for the rapid growth of Chinese shipbuilders despite shortcomings in technology.
The KCCI in a report to the Ministry of Strategy and Finance called for support from the banking sector to overcome the current slowdown. It said such support is all the more necessary because of a shift in payment practices. Before, the total price was paid in five installments of 20 percent each time until delivery, but now only 40 percent of the total price is paid in four installments during manufacturing and the remaining 60 percent on delivery.