COVID-19 cuts global maritime trade, transforms industry | UNCTAD

The pandemic has sent shockwaves through global maritime transport and laid the foundations for a transformed industry and associated supply chains. UNCTAD expects a return to growth in 2021

ball-shaped maritime deal will plunge by 4.1 % in 2020 due to the unprecedented dislocation caused by COVID-19, UNCTAD estimates in its Review of Maritime Transport 2020, released on 12 November .
The report warns that new waves of the pandemic that promote disrupt supply chains and economies might cause a exorbitant decline. The pandemic has sent shockwaves through supply chains, shipping networks and ports, leading to plummeting cargo volumes and foiling emergence prospects, it says .
According to the composition, the short-run expectation for nautical trade is blue. Predicting the pandemic ’ s longer-term impact equally well as the timing and scale of the diligence ’ sulfur recovery is fraught with doubt.

“ The global embark industry will be at the vanguard of efforts towards a sustainable convalescence, as a full of life enabler of the smooth functioning of international provide chains, ” UNCTAD Secretary-General Mukhisa Kituyi said. “ The industry must be a key stakeholder helping adapt ‘ just-in-time efficiency ’ logistics to ‘ just-in-case ’ readiness, ” he added .
UNCTAD expects maritime trade growth to return to a plus district and inflate by 4.8 % in 2021, assuming world economic output recovers. But it highlights the need for the maritime ecstasy diligence to brace for change and be well train for a transform post-COVID-19 global .

Figure 1: Development of international maritime trade and global output, 2006–2020

Source: UNCTAD calculations based on data from UNCTADstat.

Responses to the pandemic

At the bill of the crisis, when the compression of cargo volumes brought an extra challenge to structural market asymmetry, the report notes, the container embark industry adopted more discipline, cutting capacity and reducing costs to maintain profitableness alternatively of market share .
As a result, freight rates remained at static levels despite the depress demand. From the perspective of shippers, these strategies meant severe space limitations to transport goods and delays in rescue dates .
To cope with pandemic-related disruptions, players in the nautical sector adjusted their operations, finances, sanitary and safety protocols arsenic well as working practices and procedures .
In addition, several governments, through their border agencies, port authorities and customs administrations, made reforms to keep trade flowing while keeping people safe .
“ Border agents, interface workers and customs officials play an essential function in keeping trade moving, helping us to navigate through the crisis, ” Dr. Kituyi said. “ It will be significant to assess the best practices that emerge from their experiences to strengthen deal facilitation in the years to come. ”

Whither globalization, decarbonization?

While COVID-19 has underscored the ball-shaped mutuality of nations, it has raised existential questions about globalization and added weight to the pushback against outsourcing from aloof locations, the report card says .
“ The pandemic fetch into sharp focus the subject of issue chain shortening, including nearshoring and reshoring, with less addiction on just-in-time and lean inventory models, ” the report states. COVID-19 has besides brought to the fore the debate over diversifying production and manufacture sites and suppliers, it adds .
The pandemic has besides exposed how unprepared the global seemed to be in the face of such a crisis, the report observes, underscoring the pressing need to invest in risk management and emergency answer readiness in transmit and logistics .
It says future-proofing the nautical provision chain and wangle risks requires greater visibility and agility of door-to-door transport operations .
UNCTAD ’ s director of engineering and logistics, Shamika N. Sirimanne, said the pandemic should not push to the back burner action to combat climate change in ship. therefore, post-COVID-19 convalescence policies should support further build up towards green solutions and sustainability.

“ The momentum of stream efforts to address carbon paper emissions from shipping and the ongoing energy conversion away from dodo fuels should be maintained, ” she said .

Figure 2: Annual carbon-dioxide emissions per vessel by vessel type, 2019

Source: UNCTAD calculations, based on data provided by Marine Benchmark.

Harnessing the digital transformation

The pandemic has besides strengthened the case for digitalization and eliminating paperwork in the ship diligence, including in ports, the report observes, reinforcing the need for standards and interoperability in electronic documentation .
many trade facilitation measures taken during the pandemic want further investments in digitalization and automation. Accepting digital copies alternatively of wallpaper originals, pre-arrival march, electronic payments and customs automation all help speed up international trade .
On the impudent side, the pandemic has besides highlighted that digitalization comes with increase cyber security risks with a electric potential to cripple supply chains and services in ball-shaped nautical trade .
The report decries the human-centered and safety crisis caused by the pandemic, when more than 300,000 seafarers were stranded at sea for months beyond the end of their contracts – an unsustainable position for both the base hit and wellbeing of seafarers, and the safe operation of ships .
UNCTAD reiterates its call option to authorities to designate seafarers as key workers exempted from COVID-19 travel restrictions .

Trends that preceded the pandemic

Besides focusing strongly on the impingement of the pandemic during 2020, the report provides in-depth and detail coverage on ball-shaped maritime trade in 2019 .
It says COVID-19 hit world trade after an already weak 2019, in which ball-shaped nautical trade lost far momentum as deal tensions continued to bite .
They included China-US tensions, uncertainties around Brexit, complaints made by several countries against indian tariffs, the Japan-Korea trade challenge and cosmopolitan moves towards protectionism. The composition estimates that tariffs cut the volume of maritime barter by 0.5 % in 2019 .
other luminary facts and figures on global nautical trade in 2019 include the succeed :

• Iron ore trade fell for the first time in 20 years, by 1.5%, due to disruptions such as the Vale dam collapse in Brazil and Cyclone Veronica in Australia.
• Brazil overtook the US as the world’s largest seaborne grain exporter.
• As of March 2020, an estimated 20% of global trade in manufacturing intermediate products originated in China, up from 4% in 2002.
• The deployment of larger container vessels often increases total transport costs across the logistics chain. The capacity of the largest container vessel went up by 10.9%, but it’s mainly the carriers that benefit from the economies of scale offered by larger vessels, while ports and inland transport providers don’t necessarily benefit.
• Ports are showing more interest in strengthening connections with the hinterland to get closer to shippers and ‘anchor’ cargo volumes – in line with the push for port-centric solutions over recent years.
• China, Greece and Japan remain the top three ship-owning countries in terms of cargo-carrying capacity, representing 40.3% of the world’s tonnage and 30% of the value of the global fleet.
• Liberia, the Marshall Islands and Panama remain the three leading flags of registration, in terms of carrying capacity and of value of the fleet registered. As of 1 January 2020, they represented 42% of the carrying capacity and 33.6% of the value of the fleet.
• The flags of Iran, Taiwan (province of China) and Thailand registered the highest increases in terms of deadweight tonnage. The number of ships flying the flag of Iran quadrupled – this was due to the pressure of sanctions, which led several registries to de-flag vessels associated with trade involving the country.

meanwhile, UNCTAD has updated its nautical profiles with 2019 data, providing a basic snapshot of each country ‘s situation on nautical conveyance and international trade, facilitating convenient cross-country comparisons.