Following this announcement, Hanwha Ocean’s shares plunged as much as 9 percent, closed 5.8 percent lower at 103,100 won, equivalent to USD 72.28, and the KOSPI index also took a blow
China will do all it can to safeguard its maritime and shipbuilding industries, even if it means locking horns with the South Korean giant Hanwha Ocean. In a swift move to protect its interests, the Chinese Commerce Ministry has banned dealings with Hanwha Ocean’s five subsidiaries – Hanwha Shipping LLC, Hanwha Philly Shipyard Inc., Hanwha Ocean US International LLC, Hanwha Shipping Holdings LLC, and HS USA Holdings Corp – in an effort to safeguard China’s sovereignty and security.
It said Hanwha’s subsidiaries in the United States have supported and assisted the US government’s probes and measures against the Chinese maritime, logistics, and shipbuilding sectors. “China is strongly dissatisfied and resolutely opposes it. The US conduct of a Section 301 investigation into China’s maritime, logistics, and shipbuilding industries and the imposition of a series of restrictive measures are a serious violation of international law and fundamental principles of international relations, and have seriously undermined the legitimate rights and interests of Chinese companies.”
The order, which comes into immediate effect, will prohibit Chinese companies and individuals from doing business with the sanctioned companies. Moreover, a spokesperson for the Ministry of Commerce said an investigation has been launched into the actions of the United States and certain countries and companies that harm the safe development interests of China’s shipbuilding and shipbuilding industries. “The investigation will adhere to the principles of openness, fairness, and equity, and will fully guarantee the legitimate rights and interests of all stakeholders.”
Following this announcement, Hanwha Ocean’s shares plunged as much as 9 percent, closed 5.8 percent lower at 103,100 won, equivalent to USD 72.28. The KOSPI index also took a hit, spiraling down after a record high during the intraday trading on October 14. Market watchers say investor sentiment has weakened over the US-China and China-Hanwha dispute.
The Hanwha Group is closely following these developments and is closely reviewing its potential business impact on the company. South Korea’s Foreign Ministry said the government is assessing how the sanctions might affect the Hanwha companies and related South Korean industrial sectors. It will communicate with relevant ministries, industry representatives, and the Chinese government to minimise damages.
