European countries to provide liquidity support to cruise shipping companies

In order to protect jobs in the shipbuilding industry during the coronavirus crisis, cruise shipping companies in participating European countries would receive financial support, the German Ministry for Economic Affairs and Energy announced on Tuesday.

The national governments of France, Finland, Italy, Norway and Germany had agreed that cruise shipping companies could, upon application, suspend the repayment of their debts financed by state export credit guarantees for one year, the ministry explained.

“We are providing liquidity relief for the cruise shipping companies and thus stabilizing the long-standing business relations of European shipyards in the current crisis situation,” said Norbert Brackmann, the German government’s coordinator for the maritime industry.

The liquidity relief and stabilization were “urgently necessary” as the cruise business had come “almost to a complete standstill” due to the coronavirus pandemic, Brackmann said.

The financing required for the acquisition of new cruise ships would be regularly secured by government export credit guarantees, the German ministry explained.

According to the ministry, Germany alone has secured payment obligations for the financing of cruise ships built in the country to the amount of 25 billion euros (27.4 billion U.S. dollars).

The measures taken to ease the burden on cruise shipping companies would additionally serve the purpose of reducing the risk of default of state-guaranteed ship financing for the German government, Brackmann said.