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China is expected to become the world's largest shipbuilder by 2015 after launching shipyard projects in Shanghai and Guangzhou.

"The aim is to build 15 million deadweight tons (DWT) of ships at the two shipyards,'' said Li Zhushi, vice-president of China State Shipbuilding Corporation (CSSC).

Li told an international maritime forum held in Shanghai on Tuesday that their actual production could reach 12 million DWTs per annum, accounting for a quarter of the world's total.

The forum is part of Marintec China 2003, an exhibition which opened at Shanghai New International Expo Centre on Tuesday.

Co-sponsored by the Shanghai Society of Naval Architects and Marine Engineers and CMP Asia Ltd, the four-day event has attracted more than 800 companies from 32 countries and regions, said Michael Duck, senior vice-president of CMP Asia Ltd.

According to Zhang Guangqin, vice-minister of the Commission of Science, Technology and Industry for National Defence, China is expected to build 5 million DWTs of ships this year, exceeding last year's 4.17 million DWTs. It will account for a 10th of the world's total ship-building capacity.

China Shipbuilding Industry Corporation, which governs shipyards in China's northern cities, also plans to expand its annual capacity to build 4 million DWTs of ships in 2005. That number will jump to 9 million DWTs in 2015, said Dong Qiang, vice-president of the corporation.

"By then, China will probably hold a one-third stake of the world's total capacity, ranking No 1, ahead of Japan and the Republic of Korea,'' said a CSSC source who declined to be named.

The source said work on the Shanghai shipyard project, the world's largest of its kind, will start along an 8-kilometre shoreline this month.

He said Shanghai Jiangnan Shipyard will move to Changxing Island by 2007, with Shanghai Hudong Shipyard to follow by 2010. The new island shipyard will eventually be capable of building 12 million DWTs of ships annually, the source said.

In another development, CSSC has also signed an agreement with the Guangzhou city government to secure 4.5 kilometres of coastline for a 3-million-DWT shipyard.

CSSC will invest 4.5 billion yuan (US$544 million) in the first phase, using foreign and private capital, said the CSSC source.

"The Shanghai project will cost more than the Guangzhou one, but the specifics of the investment are not decided yet,'' he said.

According to Shanghai Vice-Mayor Yan Junqi, the city will relocate its shipbuilding industry from the Huangpu River to the island.

"We will seek overseas co-operation to push forward the construction of the new shipyard,'' Yan said.

She told the forum participants that the huge shipyard project is key to the city's efforts to turn itself into an international shipping centre for Northeast Asia by 2020.

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