Economic Nationalism Is Dumb

As noted here many times, Brazil has a shitload of oil that it wants to extract and sell. It has to build out alot of infrastructure to support a huge, world-class local energy sector. Alot of the work needs to be done in Brazil, but not all of it. Still the Brazilians insist on a policy of keeping work that can be done cheaper and better elsewhere home in Brazil. I first chronicled how this silliness meant higher cost to the Brazilian tax payer. Now it is looking like this dumb obsession with economic nationalism is turning to farce - the ships won't just be too expensive, they will be much delayed if they can be built at all...

LPG order on ice

Brazilian shipyard Promar Ceara won't be built in the state that bears it name and that could mean costly delays for Transpetro's eight-unit LPG newbuilding programme.

Machado (left) recently met with Brazilian President Luiz Inacio “Lula” da Silva t(right) o discuss the situation. The Rio de Janeiro-based shipowner says the "virtual shipyard" won't be breaking ground in Ceara because "it was not able to find a proper place in the right time". In another staggering blow to government inspired facility, Promar Ceara says it can't build the ships for $536m, the deal it struck with Transpetro earlier this year.

But Petrobras' shipping arm isn't giving up on the yard or its backers. As TradeWinds has reported, Promar Ceara is led by some of the same players that were behind Brazil's Atlantico Sul Shipyard. PJMR is on the fringe of forging an alliance with South Korea's STX Shipbuilding & Offshore, that would see the shipbuilding giant provide technology and a $100m investment in the greenfield yard. A spokesman for Transpetro says Promar Ceara has until 30 June to find a new home, but the source would not elaborate on what will happen if that deadline isn't met.

Just buy the damn ships from someone else!