Taipei: Taiwan's Wan Hai Lines is in talks to invest in a Chinese shipping company to expand its network and offset the severe industry downturn that could cut 30 percent off its revenue this year, Dow Jones reported.
Wan Hai Lines, the largest container shipping firm on intra-Asia routes by market share, has been cutting capacity on the Asia-Europe route and restructuring its network because of the slump in global trade and vessel overcapacity that has decimated freight rates and profit, company president Tony Chow said.An investment in a Chinese shipping firm would allow Wan Hai Lines to capitalize on the expected growth in China's river transport and trade between China and Southeast Asia, Chow told Dow Jones Newswires in an interview."We are positive on the domestic demand stimulus package implemented by the Chinese government, which will also create intra-Asia cargo as China and Asean remove trade tariffs," he said.Chow declined to name the Chinese company, but said a conclusion to the talks isn't imminent as Wan Hai Lines wants a stake of at least 51 percent in the firm."The size of the stake is the main contention point," he added.While Taiwan and China agreed on closer transport links in November, including launching direct daily charter flights and direct shipping links, there are still some restrictions on cross-strait business.
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