Taiwan has launched a relief package of more than TWD 30bn ($1bn) for its main shipping companies, with the coronavirus pandemic hitting the global container industry.
Officials from the Ministry of Transportation and Communications met the chairmen of Evergreen Marine and Yang Ming Marine Transport on Tuesday, to discuss the bailout plan and shipping market outlook.
In a statement issued after the meeting, transport minister Lin Chia-lung said: “The ministry will do its best to support the Taiwanese shipping industry during the crisis.
“Evergreen is the world’s seventh-largest container shipping line and Yang Ming the eighth-largest, and they, together with their domestic suppliers and customers, employ 440,000 Taiwanese.”
“[So] this is about Taiwan’s economic growth and people’s livelihood.”
The bailout package is composed of TWD 30bn credit guarantees and TWD 243m subsidies for interest payments for major Taiwanese lines, terminal operators and logistics firms that borrow from domestic banks.
The government did not explicitly state how much financial support Evergreen and Yang Ming will receive, but they are expected to be the main beneficiaries of this relief measure.
With the Covid-19 crisis hitting container shipping demand, the number of lines in need of government support has been increasing.
French operator CMA CGM and South Korea's HMM have together received state-backed loans totalling more than $1.71bn.
Evergreen flipped into a net loss of TWD 442m in the first quarter from a profit of TWD 560m in the same period of last year. Revenue fell to TWD 43.5bn from TWD 45.7bn.
Yang Ming, 48% owned by the government, saw its net loss widen to TWD 818m from TWD 682m. This month, the board approved a plan to sell 300m preferred shares via a private placement. The government is expected to fund the new share offering.
The latest relief package is the government’s second attempt at bailing out Taiwanese liners in less than four years.
In late 2016, it reportedly offered $1.9bn relief to Evergreen and Yang Ming, which were caught up in the container shipping industry’s last downturn.
