Intra-Asia trade will be the lynchpin for the global shipping industry in the near term as the West slowly recovers from the financial crisis, senior maritime executives.
Led by growing consumer consumption in China and India, intra-Asia trade has remained resilient despite a huge dropoff in overall freight traffic over the last two years.
“Boosted by the expansion of China’s domestic market, intra-Asia trade was able to reduce the impact of an economic recession,” said Bronson Hsieh, chairman of Taiwan’s Evergreen Marine at an industry conference.
“There is no question that intra-Asia trade will be the focal point of the shipping industry in the future.”
Asia’s economies are in the driving seat, with the IMF expecting China’s economy to grow 9.6 percent next year and India to expand by 8.4 percent.
The IMF forecasts economic growth in Asia at 6.7 percent in 2011, compared with 1.8 percent in Europe and 2.3 percent in the United States.
A reduction in import tariffs between China and the Association of Southeast Asian Nations (ASEAN) has boosted trade between the two by 47 percent to $185 billion within the first eight months of this year.
“In a few years, I do see Asia decoupling from the West,” said Alan Marsh, chief executive of leading shipbroker firm Braemar Shipping .
“Ten years ago, no one would have predicted what is happening with Asian growth and the problems in the United States at the same time.”
Signs of Asia’s growing influence have become increasingly evident throughout the maritime industry.
Companies ranging from ship broker Howe Robinson to Rolls Royce and Deutsche Bank have either expanded or relocated their maritime businesses to Asia.
The container industry, which is closely linked to world economic growth, meanwhile has introduced 26 new service routes between China and ASEAN countries this year.
Container trade in Southeast Asia rose by 17 percent to 6.4 million twenty-foot equivalent units in the first half of this year, surpassing the 12-14 percent increase in the Asia-U.S. and European routes, Evergreen Marine’s Hsieh said. (Reuters)