The global economy is highly linked to the maritime industry, a high percentage of goods and articles of mass consumption depend on this activity.
This 2020 has passed with Covid-19 as a constant, the virus far from being a public health problem became the main cause of the global economic crisis that the governments of the world are currently facing.
At the beginning of its spread, little was said about its repercussions in the economic area, today it is necessary not only to take into account its impact, but also to generate policies to counteract its effects.
Maritime industry affected by the virus
Since the Chinese economy is highly integrated into the global economy, the epidemic has had a broader impact on international supply chains.
China is not only the world’s largest exporter, it is also home to seven of the ten busiest ports and a major container shipping line.
At the beginning of the outbreak, the crisis in China led to the closure of shipyards, the activity in ports such as Wuhan where the virus emerged, was also affected.
Lower maritime transit rates
In this context, the global maritime industry faces lower than expected transit rates.
The Capesize index, which reflects freight costs of bulk commodity carriers, fell negative for the first time since 1999, meaning that shipping companies are losing on some routes and others are being suspended.
Some of the challenges facing the port and maritime industry:
- Accumulation of cargo: the value of the goods accumulated in transit in a port or warehouse may exceed the accumulation limit allowed by the insurance contract.
- Delays: Arrival of the shipment at the insured destination beyond the expected date of arrival could have financial implications for all parties involved in the shipping process.
- Diversion: in the case of unsafe ports, the ship expressly reserves the right to divert to another port that is not described in the bill of lading.
- Interruptions in transit: Cargo insurance contracts are designed to cover goods while in transit at the right time.
What does the International Maritime Organization say?
At the beginning of the pandemic, the IMO spoke of the need to maintain trade by sea and protect the well-being of the people.
“In these difficult times the transportation services to deliver vital goods, including medical supplies and food, will be critical to responding and ultimately overcoming this pandemic.” Kitack Lim. IMO General Secretary
Then in a statement, they urged cross-border agencies and governments to maintain efforts to facilitate shipping and maritime trade in these difficult times.
IMO calls to provide guarantees to crews
Maritime transport depends on the 2 million seafarers who operate the world’s merchant ships, which carry more than 80% of world trade by volume.
Crew changes are essential for the continuity of navigation in a safe and sustainable manner.
The maritime industry transports the world’s food, energy and raw materials, as well as manufactured goods and components, and is vital to sustainable development and prosperity.