Smarter and Sustainable Maritime Transportation Essential for Global Recovery

Although the impact of the COVID-19 pandemic on marine trade was less severe than projected last year, UNCTAD believes that the knock-on consequences will be far-reaching and might reshape the industry. 

The UNCTAD  found that maritime trade declined by 3.8 percent in 2020, but then rebounded, increasing by 4.3 percent this year. The medium-term picture is encouraging, but there are “increasing risks and uncertainties,” including unprecedented demands on global supply chains, significant jumps in freight rates, and price hikes that hurt both consumers and importers. 

Global socioeconomic recovery will be reliant on efficient, robust, and sustainable maritime transportation, as well as a global COVID-19 vaccination initiative that provides developing nations with more equitable access to doses. 

The pandemic has also highlighted and amplified existing issues in the maritime transportation business, such as labour shortages and infrastructure requirements. 

Lockdowns, border restrictions, and a paucity of international flights have hampered crew replacements and repatriations, according to the organisation, which has asked for immediate action to alleviate the predicament of hundreds of thousands of seafarers who have been stranded at sea as a result of the pandemic. 

Governments and international organisations must designate mariners as critical workers who must be vaccinated as soon as possible. 

“Pandemic-induced logistical challenges,” such as shortages of equipment and containers, less reliable services, and congested ports, have hampered the recovery of maritime trade. Economic recovery has been hampered as a result of supply chain bottlenecks. 

On the supply side, there are also issues. Despite the fact that new container ship orders fell by 16 percent last year, continuing a downward trend, shipping companies have raised new vessel orders this year due to present capacity constraints. 

Rising freight rates have benefited shipping companies. 

Following the grounding of the Ever Given, a massive cargo ship that clogged the Suez Canal and disrupted global trade in March, surcharges, taxes, and rates temporarily increased. 

UNCTAD has cautioned that if container freight costs continue to rise, import and consumer prices will “significantly increase”.