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Forecasts for 2017 point to a slightly higher growth rate of 2.8 percent. Projections for the medium term point to a compound annual growth rate of 3.2 percent between 2017 and 2022.
The UNCTAD Review of Maritime Transport 2017 says the world’s commercial fleet grew by 3.2 percent, to reach 1.86 billion dwt in early 2017, and that the persistent imbalance between supply and demand is keeping freight rates and earnings low in most segments.
The squeeze was felt in particular by the container shipping market, which last year reported a collective operating loss of $3.5bn. Increased consolidation among carriers could bring some order to the market and the pooling of cargo could improve economies of scale and reduce operating costs. Yet there are risks associated with the recent mergers and mega alliances among container carriers.
“The risk is that growing market concentration in container shipping may lead to oligopolistic structures,” says Shamika Sirimanne, director of the UNCTAD division on technology and logistics. “In many developing countries’ markets, there are now only three or even fewer suppliers left. Regulators will need to monitor developments in container shipping mergers and alliances to ensure there is competition in the market,” Sirimanne says. Revisiting the rules governing consortiums and alliances may be necessary to determine whether these require new regulations to prevent market power abuse and to balance the interests of shippers, ports and carriers.
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