China vie to become capital for superyachts
 
As with all statistics relating to China, the official plans for the yachting industry are eye-popping, with no fewer that 200 marinas expected to be built over the course of the government’s five-year plan to 2016.
 
The scale of these proposals has attracted substantial interest, with Victor Chu, the Hong Kong entrepreneur, recently establishing a joint venture with the UK’s Camper & Nicholsons Marina Investments to win a share of the action.
 
Yet it is by no means clear that China will become the centre of Asia’s yachting industry, either as a manufacturer or in the potentially lucrative business of providing a cruising ground and maintenance centre for visiting yachts.
 
That position could just as easily go to more traditional centres, such as Singapore or Hong Kong, both of which have a deep maritime culture and infrastructure that give them a solid head-start over coastal China.
 
There is no doubt the region is developing fast, both as a producer of large yachts and as a cruising ground for owners looking for an alternative to traditional locations in the Caribbean and Mediterranean.
 
Ellie Brade, editor of Superyacht Intelligence, part of the UK-based Superyacht Group, says the annual total of 30-metre plus yachts delivered from Asian builders has quintupled in 10 years, from two in 2001 to 11 in 2010. That is still below the peak of 16 in 2008, before the global financial crisis.
A further 30 are under construction in Asian yards, suggesting deliveries will rise again this year, says Ms Brade.
 
By global standards, the industry remains small. The 149 superyachts delivered from Asian yards so far make up just 1.2 per cent of the global fleet, underlining the extent to which growth in the Asia-Pacific markets lies largely in the future.
 
Taiwan, with 61 deliveries, is emerging as the regional leader, through builders such as Horizon Yachts of Kaoh­siung.
 
Mainland China, by contrast, has so far delivered only 23, according to Superyacht Intelligence.
 
The Chinese industry is growing, led by companies such as Kingship, based at Zhong Shan City in the southern coastal province of Guangdong. But industry professionals say there are huge constraints on local demand.
 
These range from the ready availability of cheap second-hand boats from financially embarrassed owners in the west to bureaucrats’ concerns about promoting an industry inextricably tied up with conspicuous consumption. It does not help either that the Chinese authorities impose tight restrictions on cruising by both local and foreign owners.
 
Some of this may change if Beijing is serious about developing a yachting industry. Cruising restrictions – which often prevent owners from leaving the environs of their home port – could be eased, and in­creased demand would en­courage local yacht builders.
 
Building more marinas would also help, although some that have opened in recent years, such as the impressive facility at the Visun Royal Yacht Club on the southern island of Hainan, appear to be adjuncts to expensive property developments rather than self-standing maritime ventures.
 
Meanwhile, regional experts are sceptical that China can really compete as an industry base.
 
“Hainan has berths, but not the mechanical, electrical, cleaning and other services that you need to get the boats to come,” says Y.P. Loke, a founder member of the Asia Pacific Superyacht Association, a recently established industry group.
 
He adds: “The maritime industry is not really being promoted in Hainan. It is just part of the property industry – they build the flats with a waterfront view, but they don’t put in the services to make it work.”
 
Given these constraints, the principal beneficiary of Chinese interest in super­yachts has been Hong Kong, the self-governing former British colony, which offers a natural home for Chinese owners seeking more cruising opportunities than are available on the mainland.
 
Other locations in Asia are also developing, with local yacht ownership and marina facilities increasing in Australia, Indonesia, Malaysia and Thailand, where it is centred on the holiday island of Phuket.
 
However, Scott Walker, director of Asia Pacific Superyachts, a yacht agency with representative offices in a dozen Asian countries, says that Singapore’s maritime tradition and location at the heart of the Asian cruising grounds make it one of the strongest contenders to lead the regional industry.
 
“At the moment I would say that the centre of the superyacht industry in the Asia-Pacific region is Singapore. It has been around a long time, and there are lots of facilities that give [the industry] a really strong base there,” says Mr Walker.
 
That base includes more than 5,000 maritime companies, according to Magnus Böcker, chief executive of the Singapore Exchange, with four marinas now hosting 21 locally based superyachts, up from 19 last year and just five in 2006.
 
Visitor traffic also soared last year, with a record 81 superyachts passing through Singapore, up from 51 in 2009, itself a record.
 
However, the Singapore Superyacht Association admits that whether this growth can be sustained over the long term remains open to question.
 
Visiting superyacht traffic has dipped unexpectedly in 2011, according to the SSA’s mid-year traffic report, which speculates that the strong Australian dollar may be discouraging Europe-based visitors to the Indian Ocean from making the trek southwards via Singapore and Indonesia to the Antipodes.
 
If that is the reason, the trend is unlikely to have reversed in July and August, which are traditionally weak months for non-regional visits to Asia because many western owners prefer to enjoy the summer weather in Europe or the Caribbean. The key test will be September, when yachts from outside the region are expected to return as the good weather recedes in the west.
 
SOURCE: ft.com 
 
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