England (Commonwealth Union)_ As economic unrest, the crisis in Ukraine and the effects of the pandemic undermine trade prospects, the pace of global maritime activity is expected to slow down in 2019, according to a report released on Tuesday by the UN agency UNCTAD.
After a year marred by Russia’s invasion of Ukraine and skyrocketing prices, the major investment banks in the world anticipate that global economic growth will stall even more in 2023. Over 80% of the world’s trade is transported by ships, therefore the slowdown is anticipated to have an impact on that industry, while tanker freight rates may remain high.
The United Nations Conference on Commerce and Development (UNCTAD) predicted that the growth of global maritime trade will reduce to 1.4% this year and remain at that level in 2023 in its Review of Maritime Transport for 2022. Compared to a 3.8% fall in 2020, growth of 3.2% is predicted for 2021 and an overall cargo volume of 11 billion tonnes. According to UNCTAD, growth is expected to average 2.1% per year from 2023 to 2027, which is lower than the previous three-decade average of 3.3%. The organization added that “downside risks are weighing heavily on this prediction”. With ports backed up all over the world in 2021 due to a rise in consumer spending and the effects of lockdowns, container shipping markets reached record highs.
The chances of strike action in ports and hinterland transportation have grown, UNCTAD stated, adding that the logjam in logistics will evaporate with the rebalancing of demand and supply factors.
Investment in marine supply chains was urged by UNCTAD in order to better prepare ports, shipping fleets, and hinterland links for upcoming global crises, climate change, and the switch to low-carbon energy sources. Rebeca Grynspan, the secretary general of UNCTAD, told reporters that “we need to be better prepared to cope with shocks to global value chains.”
