UNCTAD REVIEW NOTES REBOUND IN WORLD SEABORNE TRADE IN 2002, FURTHER INCREASE EXPECTED THIS YEAR

UNCTAD REVIEW NOTES REBOUND IN WORLD SEABORNE TRADE

IN 2002, FURTHER INCREASE EXPECTED THIS YEAR

(Reissued as received.)

GENEVA, 7 November (UNCTAD) -- World seaborne trade rebounded in 2002 to 5.89 billion tons, exceeding the previous record set in 2000,according to the Review of Maritime Transport 2003 issued today by the United Nations Conference on Trade and Development (UNCTAD).  The recovery in seaborne trade reflects the improved growth in world output and is expected to continue this year, amid concern about the increased costs involved in implementing tougher security measures.  The measures, which are being taken by the United States and by the International Maritime Organization (IMO), could also result in reduced cargo theft and faster cargo clearance.  Because of expertise, equipment and other resources entailed in implementation, they might prove difficult for the poorer countries to comply with.

The annual UNCTAD report looks at developments in world maritime transport, particularly for developing countries, and this year focuses on Africa.  Last year’s tonnage represented a significant increase over the 2001 slump -– 5.84 billion tons -– and a minor increase over the 5.87 billion tons recorded for 2000.

Asian countries, including Japan, had the largest share of the total volume of seaborne world exports (37 per cent), a figure that was relatively unchanged from 2001.  Manufactured goods from East and South-East Asia, together with large crude oil exports from Western Asia, contributed to this result.  Countries in Europe accounted for 25.4 per cent of world volume loaded, with European Union members representing 70 per cent of the overall European share.

Industrialized countries in North America and developing countries in America made up 21.2 per cent of world export volume; their sizeable exports of crude oil, iron ore, coal and grains accounted for about two thirds of the total volume for the hemisphere.  The shares of Africa and Oceania in world volume exported were 8.8per cent and 7.6 per cent, respectively.

The decline in seaborne crude-oil trade depressed tanker freight rates for most of the year, according to the Review.  Average freight indexes for the several types of tankers fell over 30 per cent, making 2002 another bad year for tanker owners, with the downward trend continuing into early 2003.  Conversely, the increase in dry bulk trades benefited rates for all sectors and sizes of dry bulk carriers.

For the container-ship markets, rates generally increased but did not recover to those prevailing at the beginning of 2001.  The Asia-Europe route improved the most, with rates up by around 20 per cent in each direction last year, attributable to growing trade between the two regions.  Rates have continued to climb this year, and by mid-2003 carriers had ordered more than 60 vessels with a capacity of 8,000 TEUs (20-foot equivalent units).  Further concentration occurred in containerized liner shipping:  the top 10 carriers now control almost 44 per cent of the world’s total container-carrying capacity.

World Seaborne Trade Share for Developing Countries

According to the new UNCTAD report, the overall share of world seaborne trade for developing countries last year fell slightly for goods loaded, and it rose slightly for goods unloaded.  Those countries accounted for 49.4 per cent of goods loaded and 31.4 per cent of goods unloaded, compared with 49.7 per cent and 30.8 per cent in 2001, respectively.  Oil and other commodities constitute a large proportion of loaded goods.

Asian developing countries’ share of total goods loaded and unloaded followed a similar pattern, falling to 29.6 per cent and rising to 22.1 per cent, respectively.  For African developing countries, the share of loaded seaborne goods fell to 6.5per cent, while unloaded goods remained steady at 3.2 per cent.  The share of maritime trade for developing countries in America fell slightly to 12.9 per cent for goods loaded and stayed at 5.7 per cent for goods unloaded.

For global seaborne trade, the Review reports that tanker cargoes slumped 1.4 per cent, while dry cargoes increased 2.1 per cent.  The latter rise was due to a combined 2.4 per cent positive annual growth in minor bulks and liner trades and 1.6 per cent annual growth for the five main dry bulk commodities.  Among those, iron ore, coal and bauxite shipments increased, while grain trades shrunk by 6 per cent.

The share of the world fleet of developing countries increased by 12.3 million deadweight tons (dwt), for a total fleet of 171.3 million dwt at the beginning of 2003 -– 20.3 per cent of the world fleet -– up from 159.0 million dwt the previous year.  This was primarily the result of almost 10 million dwt in fleet expansion for Asian countries.

Developing countries in Asia again increased their deadweight tonnage, from 117 million in 2001 to 126.9 million last year.  Countries in this region now own 15 per cent of world tonnage, or 74.1 per cent of the fleet of all developing countries.  African developing countries, by contrast, maintained their 0.6 per cent share of world tonnage (3.1 per cent of all developing country tonnage).  The fleet of the main open-registry countries dropped by 3.9 million dwt to 398.5 million dwt, comprising 47.2 per cent of the total world fleet (as opposed to 48.7 per cent the previous year).

Worldwide fleet expansion continued at an annual pace of 2.2 per cent, reaching 844.2 million dwt early this year, up from 825.6 million a year earlier.  New building deliveries during 2002 reached the highest level ever recorded, with 49 million dwt (up 8.4 per cent from 2001); tonnage broken up and lost totalled 30.5 million dwt (up 9.7 per cent), leaving a net gain to the fleet of 18.5 million dwt.  Oil tankers and dry bulk carriers made up 71.6 per cent of the total world fleet.  The world container ship fleet size grew by 7.4 per cent, to 82.8 million dwt.

The average age of the fleet of developing countries (13.5 years) was slightly more than the world average (12.6 years), but both have slid from the previous year.  However, this average masks considerable differences by type of vessels, with general cargo vessels the oldest (17.0 years) and container ships the youngest (9.1 years).  For developing countries the average age of general cargo vessels is 19.1 years; 65.3 per cent of them are 20 years or older.  The world tanker fleet has an average age of 11.6 years, 24 per cent of these tankers being 20 years or older.  Now that single-hulled tankers are being phased out in order to reduce the risk of pollution, the average age will drop.

Shipping lines and port authorities are in the process of improving security measures that will increase costs but could eventually lead to a quicker movement of goods, particularly containerized goods.  The United States Customs and Border Protection Container Security Initiative, involving some 20 ports, plus the advance reporting of the contents of all containers shipped to the United States, are examples of increased control.   The International Ship and Port Facilities Security Code adopted by the IMO requires all ships and ports involved in international trade to prepare and implement security plans by July 2004.  The additional costs will be borne by the trade, and poorer countries could have some difficulties complying with the new standards, predicts the Review of Maritime Transport.

Poor Regional Performance for Africa

The 53 African countries have had an average annual gross domestic product (GDP) increase during the past decade of 3.1 per cent, lower than the 4.7 per cent recorded for developing countries.  Africa accounts for 34 of the world’s 49 least developed countries, and 16 of those 34 are landlocked.  During the period 1990-2001, the value of their exports increased by 33.8 per cent, while the value of imports rose 37.1 per cent.  However, their overall share in value terms decreased from 3 per cent in 1990 to 2.4 per cent in 2001.  Sub-Saharan countries accounted for 44 per cent of African exports and 41 per cent of imports.  Freight costs for import trades for those countries in 2001 were 12.7 per cent, well above the 8.7 per cent average for developing countries as a whole, while those for landlocked countries totalled 20.7 per cent.

Road transport is the predominant mode of inland transport for the landlocked sub-Saharan countries.  The high cost of such transport is evident on a per kilometre basis when the various corridors are compared to Europe –- for example, Dar es Salaam to Kigali costs $3.02 per kilometre and Douala to Bangui, $4.94 per kilometre, compared with $1.65 per kilometre in Europe.  Wars and internal conflicts have required rerouting of some trades, resulting in mismatches of volumes with infrastructure, procedures and management capability.

Europe, notably the European Union, is the destination for about half of all African exports.  North America accounts for a little less than a fifth, which is slightly more than the share for Japan and other Asian countries.  The Middle East, Latin America and intra-African markets make up the balance of about 15 per cent.  The “everything but arms” initiative of the European Commission progressively to eliminate all quotas and duties on exports from least developed countries will provide access for more agricultural products, some of which travel in refrigerated containers.  The African Growth and Opportunity Act of the United States will also stimulate trade, the majority of which will be transported by sea.

Since 1990 the African fleet, excluding open registers, has declined from 7,268 thousand dwt to 5,406 thousand dwt in 2002, accounted for largely by declines in their tanker and general cargo fleet.  Despite the growth in containerized traffic, the container fleet also decreased over the same period, from 226 to 139 thousand dwt.  A concentration in liner services in West Africa has helped to restore rates; in addition, congestion and emergency surcharges have been introduced to recover extra costs.  In East Africa, however, operational efficiency in a number of ports has improved with the introduction of private sector operators for container handling.  Reducing transport costs will be a key factor to improving the competitiveness of the region, the Review finds.

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