MANILA – The United Nations Conference on Trade and Development (UNCTAD) said it is unlikely for the world trading system to return to medium- and long-term trends before the second half or even in the fourth quarter of the year.
An article posted by UNCTAD Wednesday showed that shipping data pointed to weakening of trade as an effect of the coronavirus disease 2019 (Covid-19).
“The epidemic has yet to run its course but even after the spread subsides and China starts to return to normal business activity, it will take a long time to unwind the stresses inflicted on the world’s trading system,” it said.
UNCTAD said container vessel port calls worldwide declined.
For Chinese ports alone, the number of vessels scheduled to call and their cumulative capacity in twenty-foot equivalent units (TEUs) dropped in late January and early February.
Likewise, the ratio of missed port calls or scheduled vessel calls that do not occur jumped in late February and in March.
“This year, the traffic slowdown, with both fewer scheduled calls and more cancelled ones, is occurring much earlier,” UNCTAD said.
It added there has been a reduction on scheduled capacities of shipping companies since August 2018 as trade wars slowed down global demand for cargo capacity.
But the plunge on capacities in the early months of 2020 accelerated significantly amid the Covid-19.
“The centrality of China to the movement of goods around the world explains this: if Chinese ports are not loading or discharging containers, there is no reason to stop at the port where the shipment is supposed to go to or come from,” UNCTAD further said.
UNCTAD’s article said the coronavirus outbreak is influencing the decisions of manufacturers and traders, but immediate actions show no coordination. (PNA)