Output in the depressed world shipbuilding industry will continue to fall until the early 1980s when production will be about one-third the peak 1975 level of 34 million grt. The decline stems from speculative overbuilding in the early 1970s and the worldwide economic recession--set of by the massive 1973/74 oil price hikes--which deflated demand for both tankers and bulk carriers. European shipbuilders have been hit not only by the global recession but also by the aggressive Japanese shipbuilders who enjoy a 30-percent cost advantage; Japanese yards continue to win more than half the world's dwindling orders. Negotiations on market sharing between the European Community and the Japanese are stymied by an inability to coordinate third-country production. The West European shipbuilders face a gloomy long-term outlook not only because of formidable Japanese competition but also because of growing competition from the rapidly developing shipbuilding industries in Brazil, South Korea, and Taiwan. Various international plans to reduce the oversupply of tankers--currently about 37 percent of the world oil-carrying capacity--have foundered on the rock of national interests. With international cooperation out, at least for the present, national subsidies to the shipbuilding industry are postponing recovery of the industry beyond the mid-1980s.

  • Corporate Authors:

    Central Intelligence Agency

    National Foreign Assessment Center
    Washington, DC  United States  20505
  • Publication Date: 1977-11

Subject/Index Terms

Filing Info

  • Accession Number: 00170492
  • Record Type: Publication
  • Source Agency: Library of Congress
  • Report/Paper Numbers: ER77-10678
  • Files: TRIS
  • Created Date: Mar 7 1978 12:00AM