Ports, terminal operators and especially ship owners tend to look for any sign of optimism and then joyously go ahead and invest without paying too much attention to the downsides facing the maritime industry. This is especially true when economic indicators suggest that a recession is around the corner.<\/p>\n
Don\u2019t believe in a recession just yet? Let the facts speak for themselves and these are not Trumpian facts. The German government has dropped its economic growth forecast for 2019 to 1% from 1.8% due to slower global economic growth and uncertainty about Britain\u2019s exit from the European Union and that, in my opinion is an optimistic forecast. The Q3 2018 GDP growth rate was -0.2% and the likelihood that Q4 will result in -0.3% is high. That, by definition, is a recession. Italy is officially in a recession and banks have sharply reduced lending. France with its weekly \u201cyellow vest\u201d mass demonstrations will not be far behind. The UK has so far shrugged off the doom and gloom prophesies of Brexit with a Q3 2018 growth rate of 0.6%.<\/p>\n
In Asia economic growth is slowing down with China reporting its 2018 GDP growth rate at 6.5% but that is very likely on the high side, with 6% being more realistic \u2014 either way, well down on historical levels. The Chinese National Bureau of Statistics said the country’s official manufacturing Purchasing Managers’ Index was 49.4 for December which was lower than expected. A reading below 50 indicate signals of contraction.<\/p>\n
Weaker growth in emerging markets, trade disputes driven by U.S. President Donald Trump\u2019s \u2018America First\u2019 policies, geo-political uncertainties and rising savings rates all suggest that there will be continued downward pressure on global trade as well as declining consumer demand.<\/p>\n
The implication for this is that the maritime industry should be cautious about the coming 18 months yet we see shipping capacity growing in a number of sectors well outpacing demand. Ports are being impacted by China driven investments related to the One Belt One Road strategy which has nothing whatsoever to do with economic factors. After more than seven years of growth we can expect a recession.<\/p>\n","protected":false},"excerpt":{"rendered":"
COMMENT: Ports, terminal operators and especially ship owners tend to look for any sign of optimism and then joyously go ahead and invest without paying too much attention to the downsides facing the maritime industry. This is especially true when economic indicators suggest that a recession is around the corner, writes Ben Hackett.<\/p>\n","protected":false},"author":8,"featured_media":514,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[66],"tags":[],"sponsor":[],"class_list":["post-513","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-economist"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/513","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/comments?post=513"}],"version-history":[{"count":1,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/513\/revisions"}],"predecessor-version":[{"id":515,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/513\/revisions\/515"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/media\/514"}],"wp:attachment":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/media?parent=513"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/categories?post=513"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/tags?post=513"},{"taxonomy":"sponsor","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/sponsor?post=513"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}