Tag: bulk

JANUARY 2017, MARITIME REVIEW, TRENDS FOR 2017

conjoncture 2017

INTRODUCTION

As 2016, three trends will describe maritime industry in 2017: 1-an increased volatility of demand 2- a sustained but uneven global recovery 3- a restructuring of the maritime supply.  This text presents an analysis of these trends.

1- An increased volatility of demand

1.1 New external factors

Variability of the risk makes demand for transport less predictable. In 2016, several factors triggered this instability, including fluctuations of exchange rates, slowdown of Chinese economy, lower oil prices and difficulties of the European economy.

In 2017, recovering of American and European economies is well engaged. Despite a slight slowdown of the GDP of the United States in the last quarter of 2016, one can anticipate a still dominant position of the U.S. dollar will continue in 2017.  The impact of a strong U.S. dollar boost U.S. imports.

In return, other external event to the industry are related to international political situation. The intention of Donald Trump to review several agreements of free-trade (NAFTA and the transpacific Partnership), the vote on the Brexit inducing the exit of Great Britain of the European Union are some examples.  The rise of protectionism could have the effect of undermining the global economic recovery.

In the sector of maritime transport, two important events occurred in 2016, the bankruptcy of Hanjin Shipping and the opening of the new Panama Canal.

Some believe that Hanjin Shipping’s bankrupcy it is precursor to a major crisis (Gerry Wang, CEO de Seaspan) in the industry. Hanjin’s situation is not unique and other maritime companies are also in difficulty. Because, recessions are the result of a chain process, if other bankruptcies were to happen, the effects could be devastating on the financial institutions, the clients or suppliers and shippers. It could even slowdown entire world economic activity.

In the case of the … Lire la suite

AUGUST 2016 FOR THE DEVELOPEMENT OF SHIPBUILDING INDUSTRY

A WINNING MARITIME STRATEGY

Can governments contribute to the development of the shipbuilding industry without resorting to public procurement? In a North American context, can we gain market share on Asia, the dominant player in this field?

A report released by researchers at the National Defense University (Eisenhower school) in the spring of 2015 partially addresses these issues. [1] It concludes that they are competitiveness problems in the  U.S. industry against Asia. China, Japan and South Korea now occupy more than 80% of the market share of shipbuilding on the commercial segment contracts.

Analysis of the strengths, weaknesses, opportunities and threats (SWOT), [2], highlights the importance of the national defense budget to compensate for the weaknesses of U.S. industry in the commercial segment.

Currently, this industry survives almost exclusively  on public procurement, notably with the military sector. It represented 38.1 billion $ in 2014, and is expected to grow annually by 3.9% per year until 2019, or 46 billion $. Barely 15% of revenues of the U.S. industry are related to the export.

One of the flagships of the report recommendations is that,  in order to ensure predictability of revenues of the industry, a strategy of public long-term purchases is necessary, as what presumably has been done in Canada. [3] However, an approach which uses public procurement for economic development purposes may have some shortcomings: it makes governments abdicate the implementation of structural measures for commercial market development; it distorts the objectives of a public policy of national defense in favor of strictly economic ones and, ultimately, undermines the efforts of the industry to increase its productivity, which would make it more competitive commercial international markets.

We must recognize that government contracts are important to ensure and maintain shipbuilding industry’s development. But dependence on collateral in the long term, as … Lire la suite