EXCLUSIVE-Troubled Taiwan shipping line Yang Ming cuts Iran service


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By Jonathan Saul and Faith HungLONDON/TAIPEI, April 21 (Reuters) - Taiwan's troubled Yang
Ming Marine Transport Corp <2609.TW> is halting its container
service to Iran, becoming the first foreign shipping line to
abandon the route a year after international sanctions on Tehran
were lifted, according to a company source.
    Yang Ming, the world's ninth largest container shipping
line, is a comparatively small player in Iran, calling there
just once a week. Several larger shipping lines have begun
serving Iran since sanctions were lifted a year ago.
    An executive with Keelung-headquartered Yang Ming said the
firm had "ceased direct services to Iran on concerns of rising
tensions there".
    "We took into consideration the recent sanctions against
Iran as well as the current geopolitical tensions in the region
and what's been going on between Iran, the U.S. and Europe," the
executive said, declining to elaborate further.
    Reuters was unable to confirm independently whether the
cancellation of the route was due to new concern over Iran, or
to changes at the Taiwanese company which is trying to slash
costs after it posted a loss of $62 million in the last quarter
of 2016.
    Yang Ming announced on Thursday in a regulatory filing it
had suspended its share trading until May 4 in an effort to
reduce losses from a global downturn in shipping.
    The executive said Yang Ming had also adjusted some of its
routes in Asia as a result of the downturn, but that ceasing
direct service to Iran was mainly because of geopolitical issues
rather than the cost cutting drive.
    The cancellation of the Iran route is likely to be seen in
the shipping industry as a further sign that business has not
picked up as quickly as Tehran had hoped since sanctions were
lifted.
    Although international sanctions over Iran's nuclear
programme have been removed, separate U.S. sanctions over its
missile programme are still in place, which has made it
difficult for international banks to engage with Iran.
    U.S. President Donald Trump's administration has launched a
review of Iran policy and suggested it could seek tougher
measures.
    While foreign shipping companies have resumed business with
Iran, the vital seaborne trade remains costly and complex.
    A U.S.-based pressure group that lobbies companies to stop
trading with Iran, United Against Nuclear Iran, said Yang Ming's
decision to withdraw was motivated by the risk of doing business
there. It released what it said was a letter from Yang Ming's
chairman Bronson Hsieh who described the decision to halt the
Iran route as part of a "strategic realignment process".
    "Yang Ming is aware of political and legal trends in the
relationship of the United States with Iran," Hsieh wrote in the
letter released by the pressure group. The company source who
spoke to Reuters was unable to comment on the letter.
    Container shipping firms including the world's top three,
Maersk Line <MAERSKb.CO> of Denmark, MSC of Switzerland and CMA
CGM of France, are among foreign lines that have resumed
services to Iran after the nuclear deal.
    Maersk said there were no changes to its Iran activities and
it was business as usual. CMA CGM declined to comment while MSC
could not be reached for comment.

 (Additional reporting by Gus Trompiz in Paris; editing by Peter
Graff)
 ((jonathan.saul@thomsonreuters.com; + 44 207 542 4357 ; Reuters
Messaging: jonathan.saul.thomsonreuters.com@reuters.net))

Keywords: SHIPPING YANGMING/IRAN (EXCLUSIVE)



This article appears in: World Markets , Stocks , Economy
Referenced Symbols: 2609 , MAERSKB


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