The Japanese container shipping company Ocean Network Express, "ONE Cygnus" sails along Southampton Water as it departs Southampton docks on April 20, 2020. (ADRIAN DENNIS / AFP)
LONDON – The pace of global shipping activity is set to lose steam next year as economic turmoil, conflict in Ukraine and the impact of the pandemic weaken the outlook for trade, UN agency UNCTAD said on Tuesday.
The world's largest investment banks expect global economic growth to slow further in 2023 following Russia's special military operation in Ukraine and soaring inflation.
In its Review of Maritime Transport for 2022, the United Nations Conference on Trade and Development (UNCTAD) projected global maritime trade growth would moderate to 1.4 percent this year and stay at that level in 2023
The slowdown is expected to impact shipping, which transports more than 80 percent of global trade, although tanker freight rates could stay high.
In its Review of Maritime Transport for 2022, the United Nations Conference on Trade and Development (UNCTAD) projected global maritime trade growth would moderate to 1.4 percent this year and stay at that level in 2023.
This compares with estimated growth of 3.2 percent in 2021 and overall shipment volume of 11 billion tonnes, versus a 3.8 percent decline in 2020.
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For the overall 2023-2027 period, growth is predicted at an annual average of 2.1 percent, a slower rate than the previous three-decade average of 3.3 percent, UNCTAD said, adding that "downside risks are weighing heavily on this forecast".
The recovery in maritime transport and logistics is at risk from the conflict in Ukraine, the pandemic, lingering supply-chain constraints, along with inflationary pressures and the “cost-of-living squeeze", UNCTAD said in the report.
A surge in consumer spending in 2021 pushed container shipping markets to record levels with ports backed up around the world, which was also partly due to the effects of lockdowns.
UNCTAD said the "logjam in logistics will dissolve with the rebalancing of demand and supply forces", but added the risks of industrial action in ports and hinterland transport had increased.
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UNCTAD called for investment in maritime supply chains to enable ports, shipping fleets and hinterland connections to be better prepared for future global crises, climate change and the transition to low-carbon energy.
"We need to be better prepared to cope with shocks to global value chains," UNCTAD Secretary General Rebeca Grynspan told reporters.